Statutes Amendment (Civil Enforcement) Bill

Second Reading

Adjourned debate on second reading.

(Continued from 6 May 2021.)

The Hon. K.J. MAHER (Leader of the Opposition) (16:09): I rise to speak on this bill and indicate that I will be the lead speaker for the opposition. The bill arises from a review by government and non-government groups, we are told, with amendments now proposed to the Enforcement of Judgments Act 1991 and the Sheriff's Act 1978. The review, we are informed, included representatives of the judiciary, the Courts Administration Authority, the Sheriff's Office, the Law Society, the Attorney-General's Department and solicitors with some expertise in these areas. A supplementary report, we are told, was also prepared by the Sheriff's Office.

A key proposed change is to allow garnishee orders to include salaries or wages without the debtor's consent. It would also allow term deposits to be included in garnishee orders, even if they have not yet matured. Currently, unmatured deposits are excluded from the reaches of garnishee orders. Also, under the proposals in this bill, creditors will be able to serve a less formal investigations notice on a debtor to provide answers or documents prior to issuing the more formal investigations summons with its additional costs and delays. We are informed that the investigations notice is based on the system that is currently used in New South Wales and may provide an opportunity to resolve certain issues without attending court.

Under this bill, the powers of the Sheriff and their officers are to be significantly expanded. These new proposed powers include the ability to order a person off land that is subject to a sale order or prevent interruption to inspection or auction, to authorise police to assist the Sheriff or their officers in their activity and to issue warrants for the provision of information to debtors or third parties who may have an interest in the debtor's property. That last item, we are informed, may be used where a bank or other third party may be involved in a particular asset or group of assets via mortgages or other means.

Whilst we are broadly supportive of attempts to modernise processes, which this bill does in part, we note with concern that, in particular, greatly expanding the powers of the Sheriff and the Sheriff's Officers could be seen as somewhat problematic. The Sheriff's Office has been the subject of concerning reports and findings arising from the investigations and deliberations of a parliamentary committee.

The opposition also has concerns about people on very low incomes and social security payments and the effect that garnishee orders without their consent could have on their ability to meet the basic needs of human life. Whilst a certain level of payment is protected from being garnished, once that payment lands in a person's bank account no statutory protections apply to social security payments. It appears, in some circumstances, a garnishee order may apply without the debtor even being aware the order is in place. This poses a risk of both severe and unexpected hardship.

The Attorney-General's office has provided some details and an initial briefing to the opposition, but there is further information that we await that will either need to be provided by the office or by the government in contributions. That includes additional information on how fees or penalties for breaking term deposits will be applied.

Under the proposed laws, if someone has a term deposit that is subject to a garnishee order, for the early maturation of a term deposit there may be some fees or penalties, in some cases significant fees or penalties. If those fees or penalties eat a large amount into that term deposit, it might be unreasonable to require the early maturing of that term deposit. For example, if there is only a month or two to run of that term deposit and a large percentage would be by way of a penalty for the early maturing of that deposit, requiring that to mature may actually serve significant hardship on the person whose name the term deposit is in.

We are also interested—and we have asked questions and are awaiting answers—in the impact on social security payments from garnishee orders on wages and salaries where no consent is required. We have outstanding questions on the potential effect on superannuation, and also cryptocurrency as an asset type to attach orders to. As I said, the opposition will support this bill at the second reading and looks forward to answers to questions we have raised in the committee stage.

Debate adjourned on motion of Hon. T.J. Stephens.