House of Assembly Fifty-Second Parliament, Second Session (52-2) 52 2 Parliament of South Australia House of Assembly published Bills Second-Hand Goods Bill SECOND-HAND GOODS BILL Committee Stage Committee Stage In committee. (Continued from 20 February 2013.) Clause 26. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: In a previous answer on clause 26, the minister said that if it is detected that a good is stolen after the 14 days have expired and after the goods have then been onsold by the second-hand dealer—and that might be because it was reported stolen late or the TMS did not do the matching or whatever other reason—that is just bad luck, we have had our chance, the good has been sold on and we probably will not recover it. What happens if the second-hand dealer does have information about their purchaser? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: One would assume that they would have the information because the individual who sold the goods would have had to go through the process of supplying the identification to have got to the 100 points such that the retailer was satisfied of the identity of the individual from whom they were purchasing. So, SAPOL will then follow that up; it is not all over because the goods are no longer in the possession of the retailer. SAPOL will then proceed on the basis that they have information that may direct them to there. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Thank you, minister. My question was about the second-hand goods purchaser, not the second-hands goods dealer—the vendor. The vendor to the business would be the person who sold the good to the business. Yes, of course, they would have all that information. I am talking about the person who purchased the good from the business. Very often, that purchaser would just come in, pay cash over the counter and they are gone. Very often they might use a credit card or a cheque. If they are a regular purchaser, it is quite possible that the business would have the identity of the person who purchased that good. What are the circumstances there? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: There is no requirement, but if a cheque or credit card was used then obviously SAPOL would follow that line of inquiry. But, there is no requirement. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: I understand; I realise there is no requirement for the second-hand goods dealer to collect that information, but if it happens to be there—and I just want to understand the answer from yesterday where you said, 'Look, it's gone if they did have that information'—so then SAPOL would have the information of the person who sold the good to the second-hand shop, and in this situation they would have the information of the person who bought the second-hand good out of the shop. Presumably then, there is good information to follow through to try to recover the good? The Hon. P.F. Conlon House of Assembly The Hon. P.F. Conlon: Yes, they'd recover the second-hand goods. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: I understand that in the legislation there is capacity, under certain circumstances, for the money that was received for the good to go back to the person from whom it was originally stolen. It may well be that that person says, 'I don't want the money; I want my ring back,' or, 'I want my necklace,' or, 'I want my special family thing,' or whatever it might be, so— The Hon. P.F. Conlon House of Assembly The Hon. P.F. Conlon: Under common law, police would have recovered the goods and given them back. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: —I am just curious to know how that would flow through, and who in the end would be the person who would miss out? Let us say, optimistically, the person from whom it was stolen gets the good back and the second-hand dealer has done everything they are expected to do under this legislation. Does the person who then purchased the good from the second-hand dealer miss out, so 'Sorry mate, you spent your money, but you spent it to buy something that was stolen; forgo that item, you have missed out,' or would the second-hand dealer then be obliged to refund the purchase price to the customer who bought it, and then the second-hand dealer misses out? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: You are probably straying well beyond the gamut of the act. My learned friend has just informed me that, under common law, the goods have to be returned to their legal owner; it is as straightforward as that. It is a principle in common law that is really not picked up in the bill that we are discussing. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Certainly; he is correct on that point, and I understand that. I am asking about who misses out on the money. Would it be the purchaser who came to the shop and paid with a credit card or cash, if, one way or another, their identity was known? They have spent 100 bucks to buy the watch in the shop. Does the purchaser from the shop just miss out on the $100 or does the shop then have to return the $100 to the purchaser and the shop misses out? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: It is not part of the bill. We are talking about aspects of the law that are very much determined and, to be perfectly honest, I am not in possession of a legal qualification. I am not really equipped to answer those kinds of questions. It is not really a matter that, in any way, shape, or form, is addressed by the bill before us. The Chair House of Assembly The CHAIR: If it is not covered by the bill, I will have to ask the shadow minister to move on. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Yes, sir—except that I was asking the question because it related directly to a previous answer from the minister, but I am happy to move on. Clause passed. Clause 27 passed. Clause 28. The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: I move: Page 16, line 35 [clause 28(1)(b)]—Before 'registered' insert 'licensee or a' The inclusion of 'licensee' is to ensure that both the licensee and the registrant are required to comply with a retention period for class 2 prescribed goods. Without this amendment, a licensee would not have to retain class 2 prescribed goods. So, we are just sorting out a bit of an error in drafting. Amendment carried; clause as amended passed. Clause 29 passed. Clause 30. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Clause 30 talks about fees and interest. I recognise that clause 36 talks about fees and charges; I understand that. I am curious to know, with regard to clause 30, what would be an acceptable rate of interest, or how would that be determined, or is it linked to something specific? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: The bill does not set the rate of interest; it will be set by the companies. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Minister, that means that the company has full discretion to set the rate of interest it chooses with regard to calculation of surplus proceeds? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: It is not a part of this bill. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Well, minister, you have a lot of advisers there, so you may well have more information at your disposal than I do, but clause 30 talks about surplus proceeds. It describes surplus proceeds in a few ways, but including being the principal specified in the agreement, interest and any specific fees and charges. So, interest is right there in clause 30. The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: The bill does not deal with the setting of interest. I have no clear advice, but I imagine that that particular issue is picked up in other pieces of legislation. It is certainly not a matter that had to be addressed in this bill because it is dealt with elsewhere. The Chair House of Assembly The CHAIR: Any other questions on clause 30? Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Yes, just a clarification. Minister, is that different or the same as your previous comment that the interest is whatever the business chooses to set it at? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: The answer I gave was correct: business sets the interest rates, it is a competitive market, individuals are free to basically shop their business around and make a selection on the basis of the best possible deal. Clause passed. Clauses 31 to 35 passed. Clause 36. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Clause 36, as I mentioned before, is closely related to clause 30 with regard to the calculation of surplus proceeds, surplus proceeds being those over and above the cost to the business including the initial outlay for the item and fair charges. You said in your last answer that interest is a competitive issue and that customers, if you like, of these businesses can shop around. I know exactly what you were getting at, but I think the interest that is being referred to here is actually different. This is not the interest the business might charge essentially for the loan, which is really what it is about, but there might be some other interest to recompense the fact that the business has held onto the good and essentially the customer has had the business's cash for a period of time. That relates directly to clause 36, where it talks about all these other fees and charges in addition to interest. Is there any guidance in the regulations with regard to what the business can charge for storage or administration, or is that a bit like the interest and the business can choose whatever it thinks is appropriate as a deduction from the surplus proceeds? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: Any costs have to be justified. If somebody was unhappy about what was being charged for storage and administration and the like, if they felt it was unreasonable they have recourse to a court of law, and the court would make a determination as to whether they were reasonable. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: I will pass a comment on that if I may, minister. I think it is exceptionally unlikely that, in the case of somebody trying to redeem their surplus proceeds from a good that has been sold after they pawned it, they are going to go to court to try to get the difference between what they think is fair administration or storage or interest cost, versus what they have actually been charged. My question on this is specifically: do the regulations cover storage costs or administration costs, or costs incidental to the sale, or expenses in repair? You have explained that they do not cover interest, but do the regulations cover any of those four categories of cost? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: It would be impossible to determine what administrative costs would be, or storage costs. They vary from business to business and from case to case. All the bill insists upon is that the charges be reasonable and again, there is recourse to the courts and also one would imagine that competitive pressures would bring a bit of common sense into play on the part of traders setting their particular charges. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: I would certainly hope the same would be true. Given that the regulations, you have said, do not cover interest, they do not cover storage costs, they do not cover administration, they do not cover incidental costs, they do not cover costs of repair, but, the bill tells me, they do cover other fees and charges, can you tell me what those other fees and charges are? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: No other fees are proposed at this stage. Mr PEGLER House of Assembly Mr PEGLER: Clause 36 goes on about reasonable costs of storing goods, etc. Does the pawn agreement in 31(1) cover all of those costs? In other words, the agreement that is signed at the time of pawning? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: Yes, it would, member for Mount Gambier, that is the intent, as far as they are known at the time of signing the agreement. I think it is fair to assume that most of those costs would be known at the time unless there was a repair involved, say, just for argument's sake, a watch that had to be repaired to make it operable for sale. But I think storage and interest and all other charges should be known at the time of the transaction, as set out. Clause passed. Clauses 37 to 39 passed. Clause 40. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: My question is about offences, so 40(1). Given that, again, we have not seen the regulations, can you tell me what kind of offences are prescribed by the regulations? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: Offences of dishonesty under Part 5 of the Criminal Law Consolidation Act: division 2—Theft; division 3—Robbery; division 4—Money laundering and dealing in instruments of crime; division 5—Deception; division 6—Dishonest dealings with documents; division 7—Dishonest manipulation of machines; division 8—Dishonest exploitation of machines; division 9—Miscellaneous offences of dishonesty; Part 5A—Identity theft; Part 6A—Serious criminal trespass; Controlled Substances Act: possessing or producing controlled substances for sale. Clause passed. Clauses 41 to 49 passed. Clause 50. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Clause 50, about market operators, and I am looking at 50(2) here, does this apply equally if one person runs one market or one person or body corporate or organisation runs more than one market? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: Yes, they can run more than one market. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Again, this is specifically about markets because that is what is in this clause, but I am asking how it might relate to garage sales. Markets are a combination of stallholders who all come together under one market umbrella to sell their goods and make their own individual profits. What about combined garage sales? I know that garage sales are excluded, but it is very normal for families—perhaps in a street or wherever they might be—to come together. Under the umbrella of one garage sale there might be two, three or even half a dozen different individual people or families coming together to make their own individual profits. Would that be a market or would that still be excluded because garage sales are excluded? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: The advice that has been given to me is that they will just be treated as a combined garage sale, not a market. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Let us take the real-world positive example and say just a few families in a street get together for one garage sale to earn a profit for their surplus items that they have around the house. Where would you draw the line—because I think it is very likely to happen—for second-hand dealers saying, 'Look, you're holding a pretty big garage sale. Do you mind if I whack a few items in there, because if I go to the market there is a piece of legislation that covers what is going on, but I can certainly sell this watch, this ring, this piece of jewellery or this iPad or iPod through your garage sale.'? When would you draw the line and say it is covered under the bill? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: If they are a licensed second-hand dealer they are a pawnbroker and, irrespective of where they sell the goods, they are covered by the obligations and constraints of the bill. So, if they decide that they want to tag along with a community garage sale that does not in any way diminish their responsibility under the act to inform SAPOL of the goods that they have in their possession, conduct the 100-point identity check and supply SAPOL as soon as is practicable with details of the day's transactions. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: If a private person came into the shop with their watch or iPod that they wanted to sell and the second-hand goods dealer, who might just be registered perhaps instead of licensed, says, 'Look, I can't take that, but there's a garage sale on Saturday. Why don't you go down there—my friend is running it—and ask them if they will put it in there for you and they might sell it down there for you.' Would that be possible? Would that be fully excluded from this legislation? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: If the manner in which they are conducting their business is such that they are behaving as a second-hand dealer then they are a second-hand dealer and they have obligations under the act. Clause passed. Clause 51. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Clause 51 is about annual returns, and subclause (1)(b) talks about lodgement with the commissioner of a return in the 'manner and form' required by the commissioner. Could you give some advice to the house about what that form might be? If you can, I would like a fairly detailed answer about what this lodgement is that is required. The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: I know that the member for Stuart is keen to ensure that red tape is kept to a minimum. The document is little more than an annual confirmation that details are unchanged, and that is place of business and the like, and that no criminal offence has been committed in the intervening 12 months that would preclude them from continuing to operate under the act. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: So it really is just as simple as the market operator reconfirming the facts as they understand them about their own business, what they do, and perhaps just signing some declaration that they have fulfilled their obligations? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: Yes. Clause passed. Clauses 52 and 53 passed. Clause 54. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Clause 54 relates to sale of goods at market and states: (1)	A person must not sell class 1 or class 2 goods at a second-hand market without the permission of the person acting as supervisor of the market. This is saying that the individual stallholders, whether it is a small company, family or a person, must have the permission of the market operator before they can sell these class 1 and class 2 goods. What form would that permission take? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: In practice, the way that it would work at, say, Gepps Cross is that, on their seeking entry to the market, the supervisor would ask the intending stallholder whether they are seeking to sell class 1 or class 2 goods. If they confirm that they are, the supervisor takes details—probably checks the driver's licence, car registration and the like—and that information, I think, ultimately is conveyed to SAPOL. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: I understand that, but this clause talks about permission. Once the market operator has collected that detail from the stallholder so that the stallholder has permission to sell the class 1 and class 2 goods, this says that after that has happened the market operator must provide permission to the stallholder to sell the class 1 or class 2 goods. I am asking what form that permission would take. Do they just say, 'Yes, I've got your 100 points. I know who you are. You come here every week. It's all okay. Off you go,' or do they need something in writing? How is that permission actually transmitted? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: The permission can be either written or oral. If they are not prepared to provide their details, the operator can prevent them from entering. If they supply the details and they have class 1 or class 2, or both, the permission can be either oral, 'Yes, you can come in,' or a note is written to that effect. That is the current situation with the existing legislation, so it is unchanged. Clause passed. Clause 55 passed. Clause 56. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Minister, clause 56(2) deals with rights of entry, and I understand why it might be important for the police or possibly others to have right of entry into business premises, but clause 56(2)(c) says that they do not have the right of entry: if there are reasonable grounds to suspect that the premises are used on a continuing or regular basis as a place of business of a second-hand dealer, pawnbroker, auctioneer or market operator and the entry is at a reasonable time. I am just curious to know when this right of entry would be likely to be used, given that generally the market is in the same place at a regular time, and the pawnbroker and the second-hand dealer are open in the same place, day after day, week after week—and I am sure during regular business hours—because if they were not, it would not be much of a business, and if they were to move, they would provide all of that information. Can you inform the house what kind of situation might it be where this power would be necessary? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: The intent is—and I think it is quite clearly spelt out because it refers to a residential premises—if SAPOL believes that a residential premises is being used on an ongoing basis as a site for a second-hand store, then they have the right to enter as long as the time selected for entry is reasonable, and that would be during general business hours. So it is really to prevent individuals from operating in an environment in which they do not have to comply with the legislation, and the selection of the residential premises would be made by SAPOL, I would imagine, on the basis of criminal intelligence. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: Do you expect that it would not apply to the regular shopfront auctioneers market, that sort of thing? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: No. Clause passed. Clauses 57 to 63 passed. Clause 64. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: I am asking about the notification from police. You have a second-hand good that has been acquired for resale, the details have been put into the TMS by the licensed or registered dealer, and the TMS and the police monitoring it have a belief that it may well be a stolen item. Clause 64(1) says: The Commissioner of Police may issue a second-hand dealer, pawnbroker or auctioneer a written notice describing goods suspected of being stolen goods. Written notice is pretty straightforward. I am not too fussed whether it is a letter, email or fax. I am more interested in the timing of it and whether there is any obligation to confirm receipt of that written notice, because in the real world you can imagine that it might have just been sold and there could be a dispute saying, 'No, you had a letter in your mailbox' or 'We dropped a notice off to you this morning' or 'You did' or 'You did not.' That sort of issue is likely to be a very real world issue if this legislation does capture and find stolen goods. The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: This provision is in the current act and, in answer, it clearly outlines that the trader—the second-hand dealer—has a clear obligation, if they have the goods, to notify SAPOL. I think the maximum penalty is $2,500 if they do not respond to the notice and they have the goods. Mr VAN HOLST PELLEKAAN House of Assembly Mr VAN HOLST PELLEKAAN: I just seek clarification, though, about confirmation of receipt of the notice, because that may well be exceptionally important for the dealer to confirm, 'Yes, I've received the notice at this point in time.' When you are running a retail business, you are open many hours a day and the good could be sold. Through no fault of the police and no fault of the second-hand dealer, someone has just come along and bought the thing and the notice may have sat in the mailbox or it may have sat in the email inbox. I imagine that some sort confirmation that it has been received must be really important. How do you propose to deal with that, please? The Hon. M.F. O'BRIEN House of Assembly The Hon. M.F. O'BRIEN: Member for Stuart, currently there is no mechanism in place whereby the second-hand dealer can indicate receipt of the notice but, talking with the SAPOL officers, this notice can be transmitted by way of email and, if that is not currently the case, we probably ought to be using this technology because it is now part and parcel of modern business practice and I think it would be simple to have one of those boxes to indicate that the email has been read. That comment has been taken on board. Clause passed. Remaining clauses (65 to 78), schedule and title passed. Bill reported with amendment. Third Reading Third Reading The Hon. M.F. O'BRIEN House of Assembly Napier Minister for Finance Minister for Police Minister for Correctional Services Minister for Emergency Services Minister for Road Safety The Hon. M.F. O'BRIEN (Napier—Minister for Finance, Minister for Police, Minister for Correctional Services, Minister for Emergency Services, Minister for Road Safety) (16:23): I move: That this bill be now read a third time. Mr VAN HOLST PELLEKAAN House of Assembly Stuart Mr VAN HOLST PELLEKAAN (Stuart) (16:23): I will just say a few brief words. I thank the minister and his advisers for their participation in this and I appreciate the opportunity to clarify a few things because there are a lot of people out there who have a lot of questions. I would like to say that I do think it is a shame that the government has chosen not to establish a select committee to look into this. This will now pass through to the upper house from this house and I know that, obviously, there is still an opportunity for the other place to consider and interrogate this bill but I think it would have been the most responsible course of action to put together a bipartisan committee to undertake this on behalf of the people who do still have serious concerns, keeping in mind that I think we all agree that it is only a very small segment of the people who participate in this industry who are doing the wrong thing. The rest of them are actually really keen to get rid of that small segment out of the industry and also to protect themselves from unwittingly taking stolen goods into their businesses because they stand a strong chance of having to pay for them and then give them back to the police—as they should—so they can be returned to their rightful owner. So, people really want this to work. It is all about the impact on business. I think that is a shame, but I do thank the minister for the spirit in which he has provided as much information as possible, as have all of his advisers. I would also like to just put on record my thanks to my very, very good staff member Mr Chris Hanna, who has also put a lot of work into this. Bill read a third time and passed.