House Contracts Guarantee (Amendment) Act 2005
Act No. 52/2005
table of provisions
SectionPage
SectionPage
Part 1—Preliminary
1.Purposes
2.Commencement
3.Principal Act
Part 2—Amendments to House Contracts Guarantee Act 1987
4.Definitions
5.New sections 11A and 11B inserted
11A.State to become liable for guarantees
11B.VMIA to be responsible for the Housing Guarantee Claims Fund and claims
6.Liability in legal proceedings
7.New section 13 substituted
13.Procedure for resolving claims
8.Claims
9.Costs
10.Appeals
11.Discretionary payments
12.Application of payments
13.New Part 2A inserted
Part 2A—Housing Guarantee Claims Fund
17B.Housing Guarantee Claims Fund
17C.What comprises the Housing Guarantee Claims Fund?
17D.Payments out of the Housing Guarantee Claims Fund
17E.Powers of VMIA in relation to the Housing Guarantee Claims Fund
17F.Report to Minister
17G.Auditor-General to audit financial statements of HousingGuarantee Claims Fund
17H.Annual report
17I.Remaining funds to be paid into Domestic Builders
Fund
14.Part 4 heading substituted
15.Sections 22 to 24 repealed
16.References to the approved guarantor substituted
17.Section 25A repealed
18.False representations
19.Definition repealed
20.References to HGFL substituted
21.Procedure for claims
22.Further references to HGFL substituted
23.New section 49 substituted
49.Remaining funds to be paid into Consolidated Fund
24.New section 50 substituted
50.Report to Minister
25.Audit of financial statements
26.New section 52 substituted
52.Annual report
27.Entering into arrangements and agreements with liquidator of HIH
28.New Part 7 inserted
Part 7—Transitional
Division 1—Transfer of Property, Rights and Liabilities of HGFL
57.Definitions
58.State to take over responsibility for guarantees
59.VMIA to be substituted as party to proceedings
60.Construction of instruments
61.Taxes
62.Transfer of staff
63.Evidence
64.Validity of things done under this Division
65.Operation of provisions not subject to review
Division 2—Role of VMIA in relation to guarantees
66.Actions of continuing nature in relation to guarantees
Division 3—Role of VMIA in relation to indemnities
67.Actions of continuing nature in relation to indemnities
68.References to HGFL in any arrangement or agreement under section 53
Division 4—Reporting by HGFL
69.Final annual report by HGFL
Part 3—Amendments to other Acts
29.Amendment to Building Act 1993
30.Amendment toDomestic Building Contracts Act1995
31.Amendments to Victorian Managed Insurance Authority Act1996
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Endnotes
1
SectionPage
Victoria
No. 52 of 2005
1
SectionPage
1
SectionPage
House Contracts Guarantee (Amendment) Act 2005[†]
[Assented to 13 September 2005]
1
Act No. 52/2005
House Contracts Guarantee (Amendment) Act 2005
1
Act No. 52/2005
House Contracts Guarantee (Amendment) Act 2005
The Parliament of Victoriaenacts as follows:
1
Part 3—Amendments to other Acts
House Contracts Guarantee (Amendment) Act 2005
Act No. 52/2005
Part 1—Preliminary
1.Purposes
The purposes of this Act are—
(a)to amend the House Contracts Guarantee Act 1987—
(i)to establish the Housing Guarantee Claims Fund; and
(ii) to confer on the Victorian Managed Insurance Authority responsibility for the administration of the Housing Guarantee Claims Fund and the Domestic Building (HIH) Indemnity Fund and claims on those Funds; and
(iii) to provide for the transfer of the property, rights and liabilities of Housing Guarantee Fund Limited to the State; and
(b)to make consequential amendments to—
(i)the Victorian Managed Insurance Authority Act 1996; and
(ii)the Building Act 1993; and
(iii)the DomesticBuilding Contracts Act 1995.
2.Commencement
s. 2
(1)Subject to sub-section (2), this Act comes into operation on a day to be proclaimed.
(2)If this Act does not come into operation before 1July 2007, it comes into operation on that day.
3.Principal Act
See:
Act No.
44/1987.
Reprint No. 4
as at
8 June 2001
and amending
Act Nos
44/2001, 9/2002, 11/2002, 25/2002 and 108/2004.
LawToday:
dpc.vic.
gov.au
In this Act the House Contracts Guarantee Act 1987 is called the Principal Act.
______
Part 2—Amendments to House Contracts Guarantee Act 1987
4.Definitions
s. 4
(1)In section 3(1) of the Principal Act, insert the following definitions—
'"appointed day" means the date of commencement of the House Contracts Guarantee (Amendment) Act 2005;
"HGFL" means Housing Guarantee Fund Limited A.C.N. 006 258 233;
"VMIA" means the Victorian Managed Insurance Authority established by the Victorian Managed Insurance Authority Act 1996.'.
(2)In section 3(1) of the Principal Act for the definition of "approved guarantor" substitute—
'"approved guarantor" means HGFL;'.
(3)In section 3(1) of the Principal Act for the definition of "claimant" substitute—
'"claimant" means—
(a)except in Part 6, a person who has made a claim to HGFL or VMIA under this Act; and
(b)in Part 6, a person who has lodged a claim with HGFL or VMIA under that Part;'.
(4)After section 3(4) of the Principal Act insert—
"(5)A reference in this Act to a guarantee given under this Act does not include a reference to an indemnity given under Part 6.".
5.New sections 11A and 11B inserted
s. 5
After section 11 of the Principal Act insert—
"11A.State to become liable for guarantees
Despite anything to the contrary in this Part, on the appointed day—
(a)the State becomes liable under any guarantee given by HGFL under this Act to the extent of HGFL's liability under that guarantee; and
(b)HGFL ceases to be liable under that guarantee.
11B.VMIA to be responsible for the Housing Guarantee Claims Fund and claims
(1)VMIA is responsible on and after the appointed day for the administration of—
(a)claims on guarantees given by HGFL or the State under this Act; and
(b)the Housing Guarantee Claims Fund.
(2)VMIA has any other functions conferred on it under this Part, Part 2A, Part 4 and Part 7.
(3)Without limiting its other powers, VMIA has any powers necessary to carry out its functions under this Part, Part 2A, Part 4 and Part7.
(4)VMIA acts on behalf of the State in carrying out its functions and exercising its powers under or for the purposes of this Part, Part2A, Part 4 and Part 7.
(5) No claim on a guarantee given by HGFL or the State under this Act can be made on the assets of VMIA and the assets of VMIA are not available for the payment of any amount of claim, costs or expenses under such a guarantee.".
6.Liability in legal proceedings
s. 6
(1)Insertthe following heading to section 12 of the Principal Act—
"Liability in legal proceedings".
(2) In section 12(1) of the Principal Act for "the approved guarantor" substitute "the State".
(3) For sections 12(2) and 12(3)of the Principal Act substitute—
"(2) Sub-section (1) applies only if—
(a)the person who makes the claim—
(i)notified the approved guarantor of the legal proceedings before the appointed day and within 3months of the proceedings being commenced; or
(ii)notified VMIA of the legal proceedings on or after the appointed day and within 3months of the proceedings being commenced; or
(b)VMIA is not prejudiced in dealing with the claim by the failure of the claimant to give the required notice under paragraph (a).
(3)Without limiting sub-section (2)(b), VMIA can establish prejudice for the purposes of that sub-section by establishing that—
(a)the State could have recovered any sum payable by it in discharge of its liability had VMIA or the approved guarantor been notified of the proceedings within the required time but that it cannot make that recovery because of the failure to give that notice within the required time; or
(b)the approved guarantor could have recovered any sum payable by it in discharge of its liability under this section as in force before the appointed day had the approved guarantor been notified of the proceedings within the required time but that it could not make that recovery because of the failure to give that notice within the required time.".
7.New section 13 substituted
s. 7
For section 13 of the Principal Act substitute—
"13.Procedure for resolving claims
(1)Subject to this section, the procedures approved under this section as in force immediately before the appointed day for the handling and resolution of claims apply (with any necessary modifications) to the handling and resolution of claims by VMIA under this Part.
(2)If—
(a)a claim has been made to the approved guarantor before the appointed day or to VMIA on or after the appointed day for loss or damage; and
(b)the claimant has also brought legal proceedings against the builder or supervisor involved in the claim—
VMIA must proceed to make a decision in respect of the claim if the matters in dispute in the legal proceedings do not include any matter to which the claim relates.
(3)If—
(a)the approved guarantor, before the appointed day, or VMIA on or after the appointed day has made an offer in respect of a claim by a person for loss or damage; and
(b)within 6 months after the offer was made the offer has not been accepted or rejected—
VMIA may refer the matter to the Tribunal and the Tribunal must treat the matter as if the claimant had not been satisfied with the offer and had appealed to it under section 16.
(4)VMIA may from time to time submit to the Minister for approval the procedures it proposes to adopt in the handling and resolution of claims under this Part.
s. 7
(5)VMIA may propose to adopt as part of its procedures—
(a)the requirement that a claim be made in a particular way; and
(b) the requirement that a claimant supply to it a statutory declaration made by the claimant verifying any information supplied to VMIA by the claimant in respect of a claim.
(6)The Minister must consult with the Minister administering the Victorian Managed Insurance Authority Act 1996 before approving the procedures.
(7) The Minister may approve the procedures with or without amendment.
(8) VMIA must adopt the procedures approved by the Minister.
(9) A procedure does not take effect unless it has been approved by the Minister.".
8.Claims
s. 8
(1)In sections 14(1), 14(1A) and 14(2) of the Principal Act,after "the approved guarantor" insert "or VMIA".
(2) For section 14(3) of the Principal Act substitute—
"(3)Sub-section (2) has no effect unless in a particular case VMIA can establish that the failure to notify the defect in accordance with that sub-section prejudiced VMIA in dealing with the claim.".
(3) In section 14(4) of the Principal Act for "the approved guarantor" substitute "VMIA".
9.Costs
(1)In section 15 of the Principal Act—
(a)for "The approved guarantor" substitute "VMIA"; and
(b)in paragraph (b) after "approved guarantor" insert "or VMIA".
(2)At the end of section 15 of the Principal Act insert—
"(2)This section does not apply if the costs referred to in sub-section (1) were reimbursed before the appointed day.".
10.Appeals
s. 10
(1)In section 16(1) of the Principal Act—
(a)in paragraphs (a), (b), (ba), (c) and (f) after "the approved guarantor" (wherever occurring) insert "or VMIA"; and
(b)after "the approved guarantor" (where last occurring) insert "or VMIA".
(2)For section 16(2) of the Principal Act substitute—
"(2)If, within 3 months after making a claim for loss or damage, a claimant has not received notice from the approved guarantor or VMIA of its decision on the claim—
(a)if that period ended before the appointed day, the approved guarantor is to be treated as having made, on the last day of that period, a decision to accept liability for the claim; and
(b)if the period ended on or after the appointed day, VMIA is to be treated as having made, on the last day of that period, a decision to accept liability for the claim.".
(3)For section 16(4) of the Principal Act substitute—
"(4)VMIA may make an offer in respect of a claim if—
(a)it has decided to accept a claim; or
(b)before the appointed day, the approved guarantor had decided to accept the claim.
(4A)Sub-section (4) applies whether or not a builder has appealed under sub-section (1)(ba) or (c) or a supervisor has appealed under sub-section (1)(f) in respect of the decision.".
(4) In section 16(5) of the Principal Act after "the approved guarantor" insert "or VMIA".
(5)In section 16(6) of the Principal Act for "the approved guarantor" substitute "VMIA".
11.Discretionary payments
s. 11
(1)In section 17(1) of the Principal Act—
(a)for "the approved guarantor" substitute "VMIA"; and
(b)after "in respect of a claim made to it" insert "or the approved guarantor".
(2)Section 17(2) of the Principal Act is repealed.
12.Application of payments
(1) For section 17A(1) of the Principal Act substitute—
"(1)If a claim relates to a failure to complete building work or a defect in building work and that claim was accepted by the approved guarantor before the appointed day or is accepted by VMIA on or after the appointed day, or is upheld on appeal, any payment made by VMIA in respect of that claim may be made on the condition that it is applied for the purpose of completion of that work or the rectification of that defect.".
(2)In sections 17A(2) and 17A(3) of the Principal Act for "The approved guarantor" substitute "VMIA".
(3)In section 17A(4) for "the approved guarantor" (where twice occurring) substitute "VMIA".
13. New Part 2Ainserted
s. 13
After Part 2 of the Principal Act insert—
"Part2A—Housing Guarantee Claims Fund
17B. Housing Guarantee Claims Fund
There is to be established a Fund to be called the Housing Guarantee Claims Fund.
17C. What comprises the Housing Guarantee Claims Fund?
(1)All property vested in the State under section58 forms part of the Housing Guarantee Claims Fund.
(2)There must be paid into the Housing Guarantee Claims Fund—
(a) all money received from the disposal of any propertyin the Fund under section 17E(4); and
(b) any money appropriated by Parliament for the purposes of the Fund; and
(c) income from the investment of the Fund; and
(d) all fees received by VMIA under section 25; and
(e) all other money authorised or required to be paid to the Fund by any person or body.
17D. Payments out of the Housing Guarantee Claims Fund
(1)There may be paid out of the Housing Guarantee Claims Fundat the direction of VMIA—
(a)any amount payable on a claim on a guarantee given under this Act; and
(b)any amount payable in respect of any liability that becomes a liability of the State under section 58; and
(c)any amount paid by the State in respect of any liability that becomes a liability of the State under section 58; and
(d) the costs and expenses incurred in the administration of the Fund and any claim on a guarantee given under this Act; and
s. 13
(e) any amount determined by the Auditor-General to defray the reasonable costs and expenses of an audit of the accounts of the Fund; and
(f) with the consent of the Minister, any amount required to meet the costs and expenses ofand any liabilities arising on the winding up of HGFL; and
(g) any other amount authorised by or under this or any other Act to be paid out of the Fund.
(2)All amounts paid out of the Fund under sub-section (1)(c) or (1)(e) must be paid into the Consolidated Fund.
(3)All money and other property in the Fund is an asset of the State.
17E. Powers of VMIA in relation to the Housing Guarantee Claims Fund
(1)VMIA may invest any part of the Housing Guarantee Claims Fund that is not immediately required for the purposes of the Fund in any manner approved by the Treasurer.
(2)Despite sub-section (1), VMIAmay continue any investment of funds of HGFL existing immediately before the appointed day and forming part of the Housing Guarantee Claims Fund as if the investment had been made by VMIA.
(3)VMIA may use any property in the Fund for any purpose related to the administration of the Fund.
s. 13
(4)VMIA maydispose of any property (other than money) in the Fund.
(5)VMIA mayenter into any agreement with any person in relation to the settlement of any liability of the State or to the State transferred under section 58.
17F. Report to Minister
VMIA must from time to time at the direction of the Minister report to the Minister in the manner required by the Minister onits administration of—
(a) claims on guarantees given by HGFL or the State under this Act; and
(b)the Housing Guarantee Claims Fund.
17G. Auditor-General to audit financial statements of Housing Guarantee Claims Fund
(1)The financial statements of the Housing Guarantee Claims Fund must be audited annually by the Auditor-General.
(2)The Auditor-General has in respect of the audit all the powers conferred on the Auditor-General by any law relating to the audit of the Public Account.
(3)The Auditor-General must submit a report of the audit to the Minister.
(4)The Minister must cause a copy of any audit report to be laid before each House of Parliament within 7 sitting days of that House after it is received by the Minister under sub-section (3).
17H.Annual report
s. 13
VMIA must include in its annual report for a financial year under Part 7 of the Financial Management Act 1994—
(a)detailsof its administration of—
(i) claims on guarantees given by HGFL or the State under this Act; and
(ii)the Housing Guarantee Claims Fund; and
(b)the audited financial statements of the Housing Guarantee Claims Fund.
17I. Remaining funds to be paid into Domestic Builders Fund
(1)If the Minister is satisfied that all claims on a guarantee given under this Act have been dealt with and that no further claim can be made on a guarantee given under this Act, the Minister may by notice published in the Government Gazette, close the Housing Guarantee Claims Fund.
(2)On the publication of the notice under sub-section (1) all money standing to the credit of the Housing Guarantee Claims Fund must be paid into the Domestic Builders Fund established under the Domestic Building Contracts Act 1995.".
14. Part 4 heading substituted
s. 14
For the heading to Part 4 of the Principal Act substitute—
"Part 4—The Register".
15. Sections 22 to 24 repealed
Sections 22, 22A, 23 and 24 of the Principal Act are repealed.
16. References to the approved guarantor substituted
(1) Insert the following heading to section 25of the Principal Act—
"Registers to be kept by VMIA".
(2)For section 25(1) of the Principal Act substitute—
"(1)VMIA must, in the form required by the Minister, keep—
(a)a register of builders and supervisors approved by the approved guarantor; and
(b)a register of work in relation to which a guarantee given by the approved guarantor under this Act is in force and of which the approved guarantor has received notice under section 24 of this Act or section 27(3) of the Building Act 1993 or of which the approved guarantor otherwise had actual notice before the appointed day.".
(3)For section 25(2) of the Principal Act substitute—
"(2)VMIA must permit a person to inspect a register required to be kept by it under sub-section (1) at any time during ordinary office hours at its offices.".