A new regime commencing on 1 November 2021 will require unique director identification numbers for all current directors, alternate directors, or those intending to become directors of:
- ORIC-registered Aboriginal corporations, and
- ASIC-registered corporations, incorporated associations registered to operate outside their home jurisdiction, corporate trustees, or foreign companies.
For Aboriginal corporations, directors must apply:
- where appointed on or before 31 October 2021, by 30 November 2023, or
- where appointed from 1 November 2022, prior to their appointment.
For Corporations Act directors, directors must apply:
- where appointed on or before 31 October 2021, by 30 November 2022,
- where appointed between 1 November 2021 and 4 April 2022, within 28 days of appointment, or
- where appointed from 5 April 2022, prior to their appointment.
Each individual is responsible for securing their unique ID using online, phone or paper-based verification processes outlined on the Australian Business Registry Services website, www.abrs.gov.au by the relevant deadlines. While an extension may be sought, a failure to secure an extension or to meet deadlines may attract infringement notices and civil or criminal penalties.
The reforms have important benefits for combating phoenix and fraudulent activity and ensuring greater transparency for those electing directors, however, they may also have unintended consequences. Considering the challenges for many persons seeking to verify their identity, particularly Aboriginal and Torres Strait Islander peoples in Australia, meeting documentary requirements by the timeframes specified may prove very difficult and may either prevent their opportunity to become a director or expose them to penalties for failing to secure their director ID. This has significant implications given the critical role, for example, of native title and charitable corporations and trusts for Aboriginal and Torres Strait Islander communities, and the need to ensure members can freely choose the right Board representatives based on their community relationships, authority, knowledge and skills, not their ability to prove their identity to a Western corporate standard.
While the deadlines for compliance may seem lengthy, corporations should start work now to ensure existing directors and as many people as possible who might be considered for directorship are provided with the resources and assistance to secure their director IDs, particularly where the verification of their identity is likely to be difficult.
For more information about how these changes may affect you, contact Maria Lamattina.
Aboriginal Corporations: New legislation set to pass
15 October 2021
On 25 August 2021, the Corporations (Aboriginal and Torres Strait Islander) Amendment Bill 2021 was introduced to Parliament following reviews and consultations conducted over five years. The Bill proposes wide-ranging reforms to the law including:
- the content of rule books,
- financial and remuneration reporting,
- audits and financial report reviews,
- how membership applications and information are handled,
- how meetings are conducted and how extensions are secured,
- increases to the range of regulatory powers to investigate and penalise non-compliance,
- options for the establishment of subsidiaries, two-member corporations and joint venture corporations,
- how books are records are dealt with,
- how related party transactions are addressed,
- the appointment of independent directors,
- how external administrations are managed and triggered,
- the introduction of whistleblower protections and other provisions to align the law with the Corporations Act 2001,
- establishing an account for handling unclaimed property,
- the use of technology and other platforms to streamline meetings, resolutions and notices by corporations and the regulator, and
- aligning the Native Title Register with the corporation’s status under the Corporations (Aboriginal and Torres Strait Islander) Act 2006.
On 14 October 2021, the Senate Finance and Public Administration Committee responsible for reviewing the Corporations (Aboriginal and Torres Strait Islander) Amendment Bill 2021 recommended the passage of the legislation without further amendment. A dissenting position from Labor members highlighted ongoing concerns from Aboriginal land councils and peak bodies about the failure to adopt past review recommendations. These included:
- an increase in the regulatory burden and exposure to penalties without sufficient flexibility,
- the lack of a separate part addressing the unique position of prescribed bodies corporate,
- the potential for new ‘two member’ Aboriginal corporations to be exploited in accessing government procurement benefits and undermine Aboriginal community control, and
- the lack of a clear object about the law’s role in building capacity, modernising governance and taking into account the traditions and circumstances of Aboriginal and Torres Strait Islander communities.
An earlier review by the Senate Standing Committee for the Scrutiny of Bills raised concerns with the framing of certain offences under the Bill, to the extent that they seek to undermine key principles in the application of criminal penalties. In particular, the 1 September 2021 report criticised:
- characterising a failure to produce certain books and records as offences, thus reversing the onus of proof, while only providing non-specific defences of ‘reasonable excuse’ to be proven by a corporation after the offence is deemed to have occurred,
- classifying a failure to produce a member register as an offence of strict liability (no fault) while also exposing a corporation to criminal liability through imprisonment, contrary to Commonwealth government guidelines requiring fault to be established to justify imprisonment,
- removing the privilege against self-incrimination in order to compel the production of books, without providing sufficient alternative protections to limit the use of information obtained in subsequent proceedings.
At this time, the Senate has not proposed any amendments to the Bill in response to either report, which looks set to pass in the coming months. All Aboriginal corporations will need to review their rule books to ensure they comply with the wide-ranging reforms, and directors and key management personnel will need to be across how this affects compliance, reporting and record keeping practices and procedures. The Bill will come into effect as a whole on the first 1 January or 1 July after the date on which it receives Royal Assent.
For more information about how this might affect you, contact Maria Lamattina.
WA Security of Payments law passed
22 June 2021
The Building and Construction (Security of Payments) Bill 2021 was passed by the WA Parliament on 22 June 2021, and brings WA into line with other national security of payments legislation for the building and construction sector. Importantly, it:
(a) strengthens contractor payment protections by enshrining payment rights, capping payment times and recognising contractors’ rights to claim a lien over unfixed plant and equipment where progress claims are unpaid;
(b) expands the application of the law and further narrows the mining exemption which will be mean construction work undertaken in relation to resources projects will likely be captured;
(c) broadens voidable contract provisions by extending the prohibition of ‘pay when paid’ provisions to include provisions dependent upon the operation of another contract, and enabling a decision-maker to deem void any onerous or unreasonable time-bar provisions (e.g. requiring certain notice or steps to be taken to preserve contractual claims for delays, variations and latent conditions, etc.);
(d) deems that retention monies are held on trust and are to be managed as trust monies in trust accounts to insulate them from a head contractor’s insolvency;
(e) requires notice to be given before calling on a performance security and enables contractors to exchange performance bonds for retention monies; and
(f) enables the Building Services Board to better manage ‘phoenix’ activity by builders with a history of insolvency by declaring them ‘excluded’.
Companies engaged in or procuring construction work should review their contracts to ensure they accommodate the new law and do not contain potentially voidable provisions, and ensure their processes and procedures are compliant before the new law before it comes into effect. For assistance, contact Maria Lamattina today.
Aboriginal Heritage Act review
A consultation paper has been released for public comment on ways to improve the Aboriginal Heritage Act 1972 (WA). Submissions are due by 1 June 2018.
Public consultations across the State will be undertaken throughout May 2018, and draft legislation will be released for comment thereafter. The WA government hopes to pass amending legislation by 2020.
In the paper, the Minister for Aboriginal Affairs, Ben Wyatt MLA states:
“It is time for the Act to be modernised in a way that is respectful of Aboriginal people and their heritage, and to ensure that our Aboriginal heritage is recognised, protected and celebrated by all Western Australians today and for generations to come.”
The paper includes questions on:
- whether the framing of the Act in the long title is appropriate
- what the best way would be to consult with the right Aboriginal people about the existence, protection and impacts of activities on Aboriginal heritage
- the role and effectiveness of honorary wardens
- the role and functions of the Aboriginal Cultural Material Committee, the Registrar and the Minister, and whether these serve the purposes of the Act
- whether the definitions of places, sites and objects capture all Aboriginal heritage warranting protection under the Act
- the efficacy of declaring protected areas for the protection of areas of outstanding importance
- whether the Act should cover Aboriginal remains
- what types of activities should require consent or authorisation under the Act
- who should provide consent or authorisation for activities that affect sites
- how to determine an impact on a site, including the non-physical aspects of a site
- how the section 18 process for seeking consent in relation to impacts on sites can be improved
- the adequacy of enforcement measures under the Act and how they can be improved
- whether the disclosure of sites should not be required where it is against customary protocols
- what the criteria for assessing the significance of a site should be
- what the procedures for changing register details, including to add or remove sites, should be
- whether any other changes to the Act are required (by including or excluding provisions).
If you would like assistance in preparing a submission, or in understanding the potential implications of any proposed reforms, contact Maria Lamattina.
High Court confirms limited scope to overturn adjudicator’s findings; finds certain retention clauses prohibited
17 February 2018
The High Court of Australia has found that an adjudicator’s award under security of payments legislation in New South Wales and South Australia cannot be challenged unless an adjudicator acts beyond power.
In two decisions handed down in February 2018, Maxcon Constructions Pty Ltd v Vadasz  HCA 5 and Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd  HCA 4, the court held that:
“the [court]… may grant relief (whether in the nature of certiorari or otherwise) for jurisdictional error by an adjudicator appointed under the Security of Payment Act; but the provisions of the Security of Payment Act, like the provisions of the New South Wales Act, oust the Supreme Court’s jurisdiction to make an order in the nature of certiorari to quash an adjudicator’s determination for error of law on the face of the record that is not a jurisdictional error.” Maxcon at . The court emphasised that an adjudication did not finally determine the rights of the parties under a construction contract and that it was open to seek relief by commencing separate court proceedings, rather than seeking to challenge the adjudication itself.
The effect of these decisions is that even when an adjudicator misinterprets the law or a construction contract, the court cannot quash the decision unless it can be shown that the adjudicator has acted beyond their jurisdiction or beyond power. This is consistent with findings of the WA Supreme Court in O’Donnell Griffith Pty Ltd v John Holland Pty Ltd  WASC 19 concerning adjudicators appointed under the WA Construction Contracts Act 2004. It highlights the importance of choosing adjudicators wisely.
Additionally, the court in Maxcon found that a retention provision, enabling a head contractor to deduct monies from an amount owing to a subcontractor, pending the release of a certificate of occupancy in respect of the works, which in turn would depend on completion being achieved under the head contract with the owner, constituted a ‘pay when paid’ provision, and was thus ineffective. The court found that a ‘pay when paid’ provision under the South Australian legislation:
“asks whether, on its proper construction, the provision “makes the liability to pay money owing, or the due date for payment of money owing, contingent or dependent on the operation of another contract”. Here,the retention provisions did just that: they made the due dates for payment contingent or dependent on “CFO”. And for “CFO” to be achieved, there had to
be issued a certificate of occupancy and “any other Approval(s) required under Building Legislation which [were] required to enable the Works lawfully to be used for their respective purposes in accordance with [Maxcon’s] Project Requirements”. Those Project Requirements were to be ascertained from the head contract. “CFO” required satisfactory completion of the head contract before the dates for the release of the retention sum could be calculated, let alone for the retention sum to be released. Accordingly, there was no error of law on the part of the adjudicator.”
In view of the above, contracts containing retention provisions ought to be reviewed to ascertain whether they may be construed as ‘pay when paid’ provisions, and thus be inoperative under the relevant legislation in your State.
In WA, the comparable provision (section 9 of the Construction Contracts Act 2004) prohibits provisions that render payment to one person contingent on payment being received from another. In that way, it does not refer more generally to the ‘operation of another contract’ as was the case in Maxcon and may be distinguishable to that extent, but care should still be taken that the drafting of any retention provisions do not ‘indirectly’ rely on payment from another party.
Contact Maria Lamattina for advice on the implications of the above decisions for your construction contracts.
Native Title Reforms: Options Paper
29 November 2017
An options paper has been released for public comment on broad ranging reforms to the Native Title Act 1993 (Cth), which can be viewed here.
The options for reform relate to:
- validating past section 31 native title agreements and changing the requirements concerning applicants being party to and executing these agreements
- changing the manner in which applicants are authorised and clarifying their functions and duties
- establishing alternative native title agreement making processes that do not require broader group consultation
- enabling registered Indigenous Land Use Agreements (ILUAs) to have minor changes made that do not require re-authorisation and registration
- making minor changes to native title processes to streamline decision-making and future acts (e.g. removing the State as a compulsory party to agreements, removing the requirement for prescribed bodies corporate (PBCs) to consult with land councils, removing compensation requirements from ILUAs)
- enabling native title parties to choose decision-making processes rather than being compelled to use traditional decision-making
- securing regulatory oversight of PBCs by ORIC for compliance with PBC regulations and the management and use of native title compensation monies, including through external trusts
- establishing dispute resolution processes through the National Native Title Tribunal and limiting the hearing of matters under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth) to the Federal Court of Australia.
Submissions on the options paper are due on 25 January 2018 by emailing them to email@example.com.
Public consultations will also occur through targeted discussions with native title stakeholders and the engagement of an expert advisory panel to formulate amendment proposals.
An exposure draft amendment bill will be released for comment in around March 2018.
If you would like assistance with preparing a submission or advice on the implications of the reforms for your organisation, please contact Maria Lamattina.
High Court Throws Doubt on Validity of WA Mining Leases
17 August 2017
The High Court of Australia has thrown doubt on the validity of mining leases granted in WA by finding that the lodgement of a mineralisation report is a condition precedent to progressing an application through to a grant. Read more here.
High Court Rules Manus Regional Processing Valid
17 August 2017
The High Court of Australia has ruled that the regional processing arrangements for asylum seekers on Manus Island are valid despite their invalidity under PNG law. Read more here.
Perth Commercial Lawyers Opens its Doors
1 August 2017
Perth Commercial Lawyers is pleased to announce the opening of its new legal practice, under the leadership of its Principal, Maria Lamattina. Maria Lamattina brings to the firm over 13 years of local and international experience in advising a broad range of clients, from individuals and small business, through to government, not-for-profit organisations, Aboriginal corporations and large corporations. Maria’s expertise in commercial, corporate, native title, resources, administrative and regulatory law is well established and will form a strong foundation for the firm’s future practice. Contact Maria Lamattina today to find out how we can help you.