Forfeiture Bill

Introduction and First Reading

The Hon. K.J. MAHER (Minister for Aboriginal Affairs, Attorney-General, Minister for Industrial Relations and Public Sector) (15:54): Obtained leave and introduced a bill for an act to make various provisions in relation to the common law forfeiture rule, to make related amendments to the Administration and Probate Act 1919 and the Criminal Assets Confiscation Act 2005 and for other purposes. Read a first time.

Second Reading

The Hon. K.J. MAHER (Minister for Aboriginal Affairs, Attorney-General, Minister for Industrial Relations and Public Sector) (15:55): I move:

That this bill be now read a second time.

I am pleased today to introduce the Forfeiture Bill 2023, which reforms the common law forfeiture rule. Stated briefly, the common law forfeiture rule prevents an unlawful killer from receiving any profit or benefit as a result of their crime. The rule stems from a longstanding and powerful maxim of public policy, that is, that no person should benefit from his or her wrongdoing.

The rule has a very long history, dating back to Jewish and Roman law, and was formally established in its modern form in the 1892 case of Cleaver v Mutual Reserve Fund Life Association. It was extended to both murder and manslaughter in the 1914 case of the matter of Hall. The rule has been endorsed by courts in countries around the world, including the High Court of Australia.

At common law in South Australia the rule applies to all cases of murder and manslaughter, with no discretion to modify the operation of the rule, regardless of any presence of extenuating circumstances. While the premise of the rule remains sound, the scope and operation of the rule has been criticised in recent times for its uncertainty and rigidity. In particular, concerns have been raised that the strict operation of the rule may lead to potentially unjust outcomes in situations involving a lesser degree of moral culpability or diminished capacity.

It is conceivable the rule could lead to potential unfair implications in such situations as a survivor of a suicide pact, where an offender has a major cognitive impairment, or especially in the context of domestic or family violence where a victim kills an abusive spouse and is convicted of manslaughter on the basis of excessive self-defence or provocation. The strict application of the rule in such circumstances has been described as 'unnecessarily harsh, inconsistent and…irrational' and 'injudicious and incongruous' with public policy foundations.

In 2011, the then Attorney-General, the Hon. John Rau MP, commissioned the South Australian Law Reform Institute (SALRI) to review the role and operation of the common law rule of forfeiture in South Australia. Specifically, SALRI was asked to consider whether there was any need for legislative intervention and to permit the application of the rule to be mitigated in appropriate cases.

SALRI published its report 'Riddles of Mysteries and Enigmas: The Common Law Forfeiture Rule' on 20 February 2020. The SALRI report is a substantive piece of work containing 67 recommendations for reform, including the creation of a new standalone act, the Forfeiture Act, to clarify the scope and application of the rule.

Members may recall that an earlier version of this bill was tabled in parliament in 2021 by the former Attorney-General in the other place. I understand the bill was tabled for the purposes of conducting public consultation and not progressed before the conclusion of the last parliament. I am pleased to formally introduce this bill into parliament, which is substantially similar to the 2021 bill.

In accordance with the recommendations of the SALRI report, the bill provides a statutory basis for the application of the common law forfeiture rule in new standalone legislation. In particular, the bill provides that the forfeiture rule applies to any benefit that an offender would otherwise obtain as a result of the unlawful killing. For the purposes of the bill the term 'benefit' is defined to broadly include any property, whether real or personal, interest or entitlement under the estate of the deceased person.

As recommended by SALRI, the bill also extends the common law rule of forfeiture so that it not only applies to murder and manslaughter but to all forms of homicide in the Criminal Law Consolidation Act 1935, including any person who aids, abets, counsels or procures the commission of those offences.

Turning to the substance of the bill, part 2 of the bill provides for a range of applications that can be made to the Supreme Court in respect of the application and the operation of the forfeiture rule. Clause 6(2)(a) allows for the executor or administrator of the deceased estate to apply to the court for an order specifying whether or how the forfeiture rule applies to the distribution of the estate.

Alternatively, clause 6(2)(b) provides that the executor or administrator of the estate may distribute the assets of the estate without having to obtain a court order if the offender has been found guilty in criminal proceedings of the unlawful killing or a court has in civil proceedings found that the offender committed the unlawful killing.

As recommended by SALRI and in keeping with the position at common law in South Australia, the bill clarifies the forfeiture rule does not apply to a person who is alleged to have unlawfully killed another person and has been found by a court to have been mentally incompetent to commit the offence. A person who is found by a court to be mentally incompetent to have committed the offence does not, in the eyes of the law, commit the crime and it is therefore appropriate the forfeiture rule does not apply in these circumstances.

In the case of a person who is found mentally unfit to stand trial, the bill makes provision for an interested person to apply to the court for an order that the forfeiture rule apply to the person as if they had been found guilty of the charge. The court is empowered to make such an order if satisfied that: firstly, the objective elements of the offence have been established, either to the criminal or a civil standard of proof, as the case may be; and it is in the interests of justice for the forfeiture rule to be applied.

In terms of modification of the forfeiture rule, part 3 of the bill makes provision for the offender or any interested person to make an application for an order to modify the application of the forfeiture rule. In accordance with the recommendations of the SALRI report, clause 9 of the bill provides that the court may only make the order where exceptional circumstances exist such that it is in the interests of justice to modify the effect of the rule.

In determining whether or not exceptional circumstances exist, the court is required to have regard to the circumstances of the offence, the effect of the application of the rule on the offender or any other person and such other matters as appear to the court to be material. In doing so, the bill seeks to allow for greater consideration of individual circumstances whilst ensuring that the underlying policy rationale of the forfeiture rule is not unduly diminished.

In accordance with SALRI recommendations, part 4 of the bill empowers the court to make other ancillary orders in relation to the operation and effect of the forfeiture rule. This includes an application by interested persons for interim orders to reserve property or any other benefit that may be subject to the forfeiture rule where there are reasonable grounds to suspect an unlawful killing has occurred (in clause 10), and for orders relating to other property and interests that the offender may have acquired as a result of the unlawful killing but that do not otherwise form part of the deceased's estate and are therefore not subject to the forfeiture rule (in clause 11).

There will be some cases where an offender is convicted, or the conviction is overturned, long after the deceased has been killed and their estate has been distributed to any beneficiaries. In these circumstances, the SALRI report recommended that the court should have the power to trace the inheritance and to make appropriate orders to ensure that those who have benefited from the deceased's estate do not receive unjust enrichment.

To that end, the bill includes the power for the court to make orders in relation to the enforcement of the forfeiture rule where the benefits of the estate have already been distributed—we find that in clause 12. Conversely, there is scope for the court to also make orders for the return of benefits in circumstances where the offender is found not guilty of the unlawful killing by a court or a conviction for the unlawful killing is subsequently quashed on appeal—found in clause 13.

In relation to part 5 of the bill, further to the creation of this new standalone legislation, schedule 1 of the bill makes related amendments to the Administration and Probate Act 1919 and the Criminal Assets Confiscation Act 2005 to support the operation of the Forfeiture Act. Schedule 1, part 1 makes amendments to the Probate and Administration Act to codify the effects of the forfeiture rule on the succession rights of third parties.

Schedule 1, part 2 amends the Criminal Assets Confiscation Act to exclude the operations of the act in circumstances where the property vests in a person in accordance with the forfeiture rule, forfeiture modification order, or other order made by the Supreme Court pursuant to the Forfeiture Act. While the government expects this legislation will be used in very rare circumstances—that is, where the forfeiture rule applies—it nonetheless addresses an important aspect of the law which is very clearly in need of reform.

Specifically, the bill will provide for greater clarity and certainty regarding the operation of the forfeiture rule. It will also enhance justice outcomes for the community by enabling the Supreme Court to modify the application of the rule in those exceptional circumstances, where it is in the interests of justice to do so.

I would like to thank everyone at SALRI for their excellent work over the last decade in delivering the report, which informed the drafting of the bill. During the consultation period, some stakeholders expressed surprise that there is no statutory basis for the rule of forfeiture. I am pleased that with this bill that will no longer be the case and that the forfeiture rule can be dragged into the 21^st century. The application of the rule in increasingly complex property, inheritance and succession contexts is another driver for this important reform.

I commend the bill to the chamber. I seek leave to insert the explanation of clauses in Hansard without my reading it.

Leave granted.

Explanation of Clauses

Part 1—Preliminary

1—Short title

2—Commencement

These clauses are formal.

3—Interpretation

This clause defines terms used in the measure.

4—Application of Act

The measure applies to property within or outside the State and unlawful killings whether occurring within or outside the State.

5—Property subject to forfeiture rule

This clause clarifies that the forfeiture rule applies to any benefit that an offender would otherwise obtain as a result of the unlawful killing.

Part 2—Application of forfeiture rule

6—Application of forfeiture rule by executor or administrator

An executor or administrator who knows (or ought reasonably to know) that the forfeiture rule applies in relation to the distribution of an estate, must distribute that estate in accordance with the rule and any agreement to modify or disapply the rule is of no effect. It is possible to apply to the Supreme Court for an order specifying whether, or how, the forfeiture rule applies to the distribution of the estate or, if the unlawful killing has been proved in criminal or civil proceedings, the estate can be distributed in accordance with the rule without any court order.

7—Rule does not apply to person who was mentally incompetent or unfit to stand trial

The forfeiture rule does not apply to a person who is found to have been mentally incompetent to commit the unlawful killing and, subject to an order under clause 8 of the measure, the rule does not apply to a person found to be mentally unfit to stand trial on a charge of the unlawful killing.

8—Forfeiture application orders

This clause allows and interested person to apply to the Supreme Court for an order that the forfeiture rule applies to a person who has been found by a court to be mentally unfit to stand trial on a charge of an unlawful killing.

Part 3—Modification of forfeiture rule

9—Forfeiture modification orders

This clause allows the offender or any other interested person to make an application to the Supreme Court for an order modifying the effect of the forfeiture rule.

Part 4—Other orders

10—Interim orders

The Supreme Court may, on the application of an interested person, make any interim orders in order to preserve property or the value of any benefit that might be subject to the forfeiture rule or to protect the interests of any interested person.

11—Orders relating to other property and interests

If the Supreme Court is satisfied that an offender will or may be entitled to obtain any property or interest as a result of an unlawful killing (not being a benefit that is subject to the forfeiture rule), the Court may, on the application of an interested person, make orders under this clause to prevent the offender from obtaining the property or interest.

12—Enforcement of forfeiture rule etc after distribution of benefits

If a person has received a benefit as a result of an unlawful killing (otherwise than pursuant to a forfeiture modification order), an interested person may make an application to the Court for an order requiring the person to deliver up the benefit, or to pay an amount determined by the Court to be equivalent to the value of the benefit, to any person who would have been entitled to the benefit if the offender had died before the deceased person.

13—Return of benefits where conviction quashed etc

This clause allows for the return of benefits that were distributed in accordance with the forfeiture rule (or payment of their equivalent value) where the offender is subsequently found not guilty of the unlawful killing by a court or a conviction for the unlawful killing is subsequently quashed on appeal.

Part 5—Miscellaneous

14—Proceedings to be civil

Proceedings under the measure are civil proceedings.

15—Orders under Act

An order of the Supreme Court under the measure may be in such terms and subject to such conditions as the Court thinks fit.

16—Time for bringing proceedings

This clause specifies time limits for applying for orders under the measure.

17—Evidentiary

This clause provides for evidentiary certificates.

18—Regulations and fee notices

This clause provides for the making of regulations and fee notices.

Schedule 1—Related amendments and transitional provisions

Part 1—Amendment of Administration and Probate Act 1919

1—Insertion of section 36A

Proposed section 36A provides for an alternate grant of probate or administration where the Court considers that there are reasonable grounds for believing that a person otherwise entitled to a grant of probate or administration has committed an offence relating to the deceased person's death.

2—Insertion of section 118

If a person is for any reason disqualified from taking their interest under a will or taking their share in the distribution of an intestate estate, the person is to be treated as having predeceased the testator or intestate (as the case may be).

Part 2—Amendment of Criminal Assets Confiscation Act 2005

3—Amendment of section 7—Meaning of proceeds and instrument of an offence

Property that vests in a person from the distribution of the estate of a deceased person in accordance with the forfeiture rule or a forfeiture modification order or other order under the measure will cease to be proceeds of crime for the purposes of the Criminal Assets Confiscation Act 2005.

Part 3—Transitional provision

4—Application of Act

The measure only applies in relation to an unlawful killing occurring after its commencement.

Debate adjourned on motion of Hon. D.G.E. Hood.