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House of Assembly - Fifty-Second Parliament, Second Session (52-2)
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STATUTES AMENDMENT (DIRECTORS' LIABILITY) BILL

Second Reading

Adjourned debate on second reading.

(Continued from 28 November 2012.)

Ms CHAPMAN (Bragg—Deputy Leader of the Opposition) (16:57): I rise to speak on the Statutes Amendment (Directors' Liability) Bill 2012.

The DEPUTY SPEAKER: Are you the lead speaker?

Ms CHAPMAN: I am probably the only speaker.

The DEPUTY SPEAKER: Right. Good.

Ms CHAPMAN: This is a bill which the Attorney came into the chamber with in November last year. It is essentially to deal with a COAG agreement that had its conception back in 2008. It then had a torturously slow gestation period, moving at glacial pace—a bit like the government's coming to the table on ICAC—and we finally had some agreement as to what should occur.

Essentially, as apparently occurs at a lot of these COAG agreements, somebody came up with a bright idea that we need to have a national harmonious scheme where everyone is the same and everyone will be happy and that one size fits all is the answer to all ills. In the area of directors' liability this is probably not a bad thing to have some consistency because of the nature of people offering their services or accepting responsibility in the role of directors of companies and boards, which is covered at a national level in the private sector under our Corporations Law.

In the public sector similarly there are considerable responsibilities but, with the development of duties and responsibilities in this area, considerable liability and exposure to prosecution if directors fail knowingly in their responsibility. There has been some effort made to deliver some reform to provide for all Australian jurisdictions to have directors' liability at the same level, particularly those imposing vicarious liability on directors for actions of the corporation.

The situation as I understand it is that in 2009 the reform was initiated to be more consistent in respect of the personal liability of directors for corporate offences. The attempt to do this was then followed by an audit of legislation. In the South Australian parliament, it resulted in us passing the Statutes Amendment (Directors' Liability) Act of 2011. The whole process was then assessed by Corrs Chambers Westgarth, and suffice to say they did not consider that the action that had been taken was satisfactory at all. Accordingly, a second review was undertaken and now we are seeking to further amend the 2011 act.

This bill essentially intends to completely remove directors' liability from 19 acts without replacement and also, in 24 acts of parliament, to repeal the existing directors' liability provisions and substitute another regime. There is a varying code in respect of the types of offence that should prevail, and I will not go through those because I do not think it is necessary; they have been quite well traversed in the second reading explanation of the government.

The bill will also allow for the regulations to impose vicarious liability for offences against regulations. They are as apply under the Animal Welfare Act, the Authorised Betting Operations Act, the Gaming Machines Act, the Second-Hand Vehicle Dealers Act, the Security and Investigation Agents Act (which I note is up for reconsideration in our legislative agenda this week), the Taxation Administration Act 1996 and the Travel Agents Act 1986.

There is a whole tranche of legislation that has been excluded from this reform and they relate to: occupational health and safety legislation; significant environmental protection legislation, including the Environment Protect Act, the Marine Parks Act, the Native Vegetation Act, the Nuclear Waste Storage Facility (Prohibition) Act, the Radiation Protection and Control Act, and the River Murray Act, in addition to the Dangerous Substances Act. As members would know, these acts attempt to prevent and have penalties where very serious harm would follow from decisions and where it is considered in the public interest that directors should be held criminally liable for actions of the company.

The Attorney-General I think in his second reading contribution also made the point that our current Work Health and Safety Act 2012 is already consistent with the COAG guidelines and therefore we do not need to interfere with that. We are also advised that the directors' liability provisions in the core environmental legislation may still be reviewed as part of the COAG green tape review, which is separate to the director liability reforms.

The general consultation on the briefing that has been provided and the material provided from the Law Society and the Australian Institute of Company Directors and the South Australian Joint Legislative Review Committee are supportive of the bill's underlying intention to reform directors' liability provisions, but that they are all quite critical of the government's execution.

The concerns that have been raised include—unsurprisingly, the Attorney might say—that the Law Society considers that the reverse onus type offence provisions in the bill should be amended so that a director has a defence if they can show that they have exercised due diligence. The society's concern has been expressed that where the defence of due diligence is available the bill does not state the standard of proof to which the defence must be proved and, not surprisingly, the Law Society outlines that it is intended to be the balance of probabilities, not beyond reasonable doubt.

The Law Society also outlines that liability created by type 3 provisions does not fit within the bounds of vicarious liability as described by the courts and the commentary but fits with the description of derivative liability and, as such, references to vicarious liability within the bill should be changed. That is really a matter which could be taken up. I do note that the Attorney has tabled a significant number of amendments today. Although I have not gone through those in detail, I am just trying to see whether there is any remedying of that aspect. If there is not, there certainly should be, but that is minor in the scheme of things. That is really in the description of whether something is really a vicarious liability or in fact whether it is a derivative liability.

The South Australian joint Legislative Review Committee identifies their concerns, namely that concepts such as due diligence, 'position to influence' and 'significant risk' are subject to judicial interpretation, which is influenced by the relevant act and organisation, and that this may detract from the government's goal of achieving certainty and clarity. The Australian Institute of Company Directors' criticism of the government's reform has flowed as a result. They suggest that the government has not followed the model suggested by their institute—perhaps a subjective view, but they consider theirs to be a better model—and that numerous acts retain provisions reversing the onus of proof. That of course has been reflected in the Law Society's concerns.

What is interesting is that the Australian Institute of Company Directors has identified a number of areas where they consider this reform has been omitted as applicable to directors' liability under some legislation. Again I am just trying to quickly view the amendments that have been tabled, but this does not appear to have any remedy in the amendments.

Their concern is that the following bills, they suggest, have been ignored and should have been included: the Aboriginal Heritage Act 1988, the Community Titles Act 1996, the National Electricity (South Australia) Act 1996, the Public and Environmental Health Act 1987, the Second-hand Dealers and Pawnbrokers Act 1996, the Strata Titles Act 1988 and the Summary Offences Act 1953.

Personally, I have not viewed the provisions in those acts as to whether that is a concern that should be accommodated. I am assuming at this point that the government has had notice of the AICD's concerns about this apparent omission and that, if they are not in the amendments, they have rejected their submission in that regard.

Perhaps the most concerning aspect, I think, is to allow for regulations in the bill to 'impose such liability that can be considered appropriate in particular cases'. The Attorney is well aware of the opposition's view in allowing powers into regulation when they should be in an act. To compound the felony of using a clause such as this in regulation is the sloppiness—in my view—of the drafting. I do not mean that of those who have actually presented it. To have it in regulation is bad enough but to actually have an imposition of a liability in such a loose manner, let alone being a regulation power, the opposition does consider to be quite unacceptable.

Of all of those submissions, the two things therefore that are of most concern to the opposition are the reverse of the onus—and we think it is appropriate to amend the reverse onus provisions to provide a defence if a director can show that they have exercised due diligence—and for the reasons outlined, we should also remove the capacity to allow regulations to impose liability.

The only other matter that I would bring to the attention of the Attorney is that I recall, in about 2003, the government undertook some reform of governance of each of the three universities of South Australia. Members may not all be aware, but the statutory responsibility of our universities is actually under this state parliament's jurisdiction. Although often universities are seen as having a federal connection, and indeed they do have significant funding from the federal government and they are subject to and enjoy the benefit of significant income in grants from federal bodies, they actually have been born and continue to be managed under this parliament's legislation.

When the reforms came to this parliament to essentially streamline the structures of governance in our three universities, I was then the opposition's spokesperson for education. It was reform that was borne under the leadership the member for Ashford when she was the minister for higher education and concluded in the final debates of that under the former member for Adelaide, the Hon. Jane Lomax-Smith.

The reason I mention it is because it was the first time I had seen in legislation what appeared to me to be oppressive obligations on directors and extraordinary levels of fines and liability that could be placed upon directors, who, frankly, were giving of their time, experience and expertise to an academic institution which I think everyone would agree had the benefit of that wise council. To introduce legislation that I thought was so draconian and would have such an adverse impact on the willingness of good people to step forward and take up positions in leadership roles on the university boards was very concerning to me, and I expressed it at the time.

The minister, the Hon. Jane Lomax-Smith, I think was sympathetic to those concerns, so much so that when we finished the bills they were very significantly watered down. I was pleased that she listened to that. Perhaps because she had experience herself as being a member of the University of Adelaide council, she understood the importance of having good people undertake these positions.

I cannot recall being directly involved in doing any of the forensic examination of legislation that otherwise had introduced such draconian legislation, but it does seem that there is a lot of legislation out there in which there has been an unrealistic expectation placed on directors or prospective directors and an unfair burden of exposure to prosecution of very significant penalties, which they should be relieved of. So, I for one am glad that this bill has finally come to fruition. It seems as though attempts in 2011 to remedy this from the South Australian perspective were not as successful as we thought that they were going to be.

I am not saying that that is a direct reflection on the government. It does seem from the report from Corrs Westgarth that this is a difficult area to get it right, so although their assessment was quite scathing, the reality is that we have to try the best we can to remedy it. I think the government have really not fully understood the importance of ensuring that, firstly, we do not place directors in a position where they do not have the defence. I think therefore that is important that that defence must be there if the director can show that they had exercised due diligence. Also, we cannot have statements which allow for imposing liabilities under regulation in such a sloppy manner as is proposed in this bill.

Otherwise, with those two riders, we will support the bill and I will listen with interest to the Attorney's contribution on the amendments. No doubt these amendments have come with some further consultation and perhaps identification of some of the concerns that have been raised by the substantial stakeholders who have put submissions in on this. They may have simply just been errors that have been picked up, but they seem to be rather comprehensive, so I will listen with interest and if they are sensible then they will have my support.

Mrs GERAGHTY (Torrens) (17:20): I rise to express my support for the bill and I do not want to go over all the same ground that the member for Bragg did, nor the minister, however I do just want to say that I think it is worth noting some points. In November 2008 as part of the Seamless National Economy Agreement through the Council of Australian Governments, the commonwealth and all the states and territories agreed to reform the directors liability provisions in their legislation. The result of this agreement is this bill, the Statutes Amendment (Directors Liability) Act 2011 which amended 25 acts when it came into operation in January 2012.

After it came into operation, the Australian Institute of Company Directors voiced strong opinions against the principles and audits the bill was formed around, consequently a review was undertaken by Westgate Chambers at the request of the commonwealth, the content of the guidelines was contentious but they were eventually endorsed by COAG on the 25 July 2012. In order to meet COAG milestones South Australia, among other states and territories, conducted a second audit according to the guidelines. Under the Seamless National Economy Agreement, COAG agreed to make reward payments to jurisdictions on achieving various reforms.

The Attorney-General's Department conducted an extensive second audit of legislation to produce recommendations about each offence provision in each relevant act. Following this the recommendations and the draft guidelines were sent to every relevant minister in December 2011. The responses given by the ministers and senior departmental officers were heavily considered in the drafting of this bill. The bill amends 50 acts. It will reform directors liability provisions in 43 acts in addition to the reforms to directors liability provisions in 25 acts made by the Statute Amendment (Directors Liability) Act 2011.

The bill has addressed three types of vicarious directors liability provisions as described in the COAG guidelines. Two of these are used in South Australia. They are type 1 provisions—provisions where the prosecution must prove beyond reasonable doubt every element of the offence alleged to have been committed by the director, including the director's lack of care and type 3 provisions—the typical reverse owners provisions where directors will be found guilty vicariously for corporate offences unless they prove on the balance of probabilities that they could not by the exercise of due diligence have prevented the company from committing the offence. The passage of this bill demonstrates the government's continuing efforts to provide South Australia with sound and fair legislation that is consistent with the rest of Australia.

The Hon. J.R. RAU (Enfield—Deputy Premier, Attorney-General, Minister for Planning, Minister for Industrial Relations, Minister for Business Services and Consumers) (17:24): I thank the member for their contributions. It is refreshing to have people covering different ground and I do thank everybody for their contribution. I thought what I might do, if it is alright with the house, is to foreshadow the amendments that we are making and perhaps explain why, and that might make things a little quicker when we get to that point in proceedings.

In drafting the penalty increases, the pattern of the act being amended has been followed. So if an act contains divisional penalties, the new penalties are divisional penalties. If an act contains penalties expressed in dollars, the new penalties are expressed in dollars. Generally, the increases in divisional penalties have been to one division higher. Where an act has different penalties for bodies corporate and natural persons, that pattern has been followed in most cases.

Where there are different penalties for bodies corporate and natural persons, the practice in South Australia is to make the penalty for the body corporate five times that of the penalty for a natural person. That practice is reflected in the amendments I move today.

The penalty increase amendments are confined to those provisions that were identified during the consultation process with government agencies as being in need of revision. The amendment I move to sections 48, 49 and 49A of the Development Act are to increase the penalties from Division 4 fines (with default penalties of $200 per day) to Division 3 fines (with default penalties of $500 per day). This means the maximum fine would increase from $15,000 to $30,000.

These penalties should be in effect a deterrent to noncompliance by companies, and not seen as a cost of doing business. An offence against section 48 is a failure by a person who has the benefit of a development authorisation granted by the Governor for a major development or project to ensure that the development is used, maintained and operated in accordance with the authorisation and the documents submitted in support of the authorisation application.

The offence against section 49 is about crown developments and public infrastructure, and the offence may be summarised as failing to perform building work for this type of development in accordance with the certified specifications, or failure to comply with the building rules. The offence against section 49A may be summarised as a failure by a person performing building work on an approved electricity infrastructure development to ensure that the work is in accordance with the certified specifications or within the building rules.

The amendment to sections 69 and 71 would increase maximum penalties from Division 5 fines (with default penalties of $50 per day) to Division 4 fines (with default penalties of $200 per day). That means increases in fines from $8,000 to $15,000. The first offence may be summarised as a contravention or failure to comply with an emergency order made by an authorised officer in relation to a threat to safety, or a heritage or local heritage place. The second offence may be summarised as a failure to comply with a notice to report or take measures to ensure fire safety.

In relation to the Electricity Act, the effect of these amendments is to double the maximum penalties for five offences against the act from $5,000 to $10,000 and from $10,000 to $20,000. The existing penalties are considered to be insufficient to ensure compliance by companies. The offences against 61(1) and 61(4) involve failure to ensure that electrical installations are carried out and tested in accordance with regulations, and failure to give a certificate of compliance. The penalty would be increased for bodies corporate to $10,000.

Section 61A makes it an offence for a person to install electrical equipment that a person knows, or should know, is unsafe. The penalty would be increased to $10,000. In summary, an offence against section 84 is the unlawful interference with an electricity infrastructure or installation, and the penalty for this offence would be increased to $20,000. Section 85 prohibits unlawful taking of electricity or interfering with a meter, and the penalty for this will be increased to $20,000.

There is a further amendment (No. 3) to the Electricity Act. This amendment is to correct a technical error in the bill. The bill should have repealed only subsection (1) and retained subsection (2). Subsection (2) enacts the general defence that the act or omission constituting the offence against the act was reasonably necessary in the circumstances to avert, eliminate or minimise danger to a person or property.

There are then some amendments to the Fair Trading Act. In relation to those I would just say that section 43(2) of the Fair Trading Act prohibits creditors and their agents from making certain false representations to debtors for the purpose of recovering a debt. The penalty is currently $5,000 or imprisonment for six months. Corporations cannot be imprisoned and a fine of $5,000 does not reflect the seriousness of these offences. The amendment I move would increase the penalty for bodies corporate to $25,000 while leaving the penalty for natural persons unchanged.

There are then changes to the Fire and Emergency Services Act. The amendment to section 86 of that act would change the penalty from $10,000 to $50,000 for a body corporate while retaining the penalty of $10,000 for a natural person. The offence is failure to comply with the requirement of an authorised officer to take specified fire prevention measures.

Then under the Gas Act the particular amendment there would increase penalties from $10,000 to $20,000 for unlawfully interfering with a gas distribution system or installation or unlawfully extracting or diverting gas. This increase is the same as the equivalent offences against the Electricity Act.

Then under the Heritage Places Act 1993, this amendment is to section 36(2) of the act—which is not to be amended—imposes a penalty of $50,000 for damaging or destroying a state heritage place. Section 36(2) makes it an offence to fail to take reasonable care of a state heritage place or to fail to comply with a prescribed requirement concerning protection or repair of a state heritage place. Neglect can be as detrimental to a state heritage place as a positive act of damage. For that reason, I move this amendment to increase the penalty for neglect to the same level as the penalty for positive acts of damage, namely $50,000.

Then we have some matters under the Irrigation Act. These amendments change penalties for bodies corporate that commit offences against three provisions in the Irrigation Act from $20,000 to $100,000. The penalty for a natural person and the expiation fee would not change. The current penalties are very different from penalties in some other acts that protect water or provide for regulation of water use.

Section 40 prohibits connection of a channel or pipe to an irrigation or drainage system of the irrigation trust, placing structures or installing equipment in, on or adjacent to drainage systems of the trust without approval. It also prohibits a person who receives water from the trust from supplying water to another person without approval.

There are various other restrictions. The trust may direct landowners to do certain things such as erect fences to keep stock out of channels. Contravention of any of the requirements or prohibitions in this section is an offence. Section 62 prohibits interference with the irrigation or drainage system or irrigation property of the trust without authority. Section 63 prohibits taking water from the irrigation or drainage system without authority, or using water taken for an unauthorised purpose.

Under the Livestock Act we have an amendment to increase the penalties for offences against three provisions in the Livestock Act. The penalty for offences of failing to report a notifiable disease, not giving an inspector further information that the inspector requires or failing to take all reasonable measures to control or eradicate a notifiable disease is currently $2,500 with an expiation fee of $210. The amendment I move would increase the penalty for these offences if they relate to an exotic disease to $10,000; the penalty would remain the same for other notifiable diseases.

Section 33 of the act prohibits the movement of livestock, livestock products or associated property without a health certificate. This is an important element in the avoidance of the spread of disease. Subsection (4) requires the keeping of the required documentation for 12 months and the penalty is currently $2,500 with an expiation fee of $210. The amendment I move will increase the penalty for failure to keep documentation for 12 months to $5,000 and the expiation fee to $315. Then under the Livestock Act section 17 requires a person who keeps livestock of a prescribed class to be registered. I am advised that in the future it might be that the only prescribed classes will be bees and possibly deer; why those two alone I am not sure, but there we are.

Mr Treloar: Bees?

The Hon. J.R. RAU: Bees and deer. After further consideration and consultation, it has been decided that it would be more appropriate that offences against section 17 attract type 1 vicarious directors' liability instead of no vicarious liability. The amendment I move is to give effect to that decision.

Ms Chapman: Which amendment is that?

The Hon. J.R. RAU: This is amendment No. 10 to the Livestock Act. Then we have various other bits and pieces. The penalties in the Passenger Transport Act 1994 have not been changed since the act was enacted. The amendment I move will increase the penalties by one level on the divisional scale, with the exception of the penalty for one offence that would increase by two levels.

So, an offence that currently carries a division 5 fine, which is $8,000, will carry a division 4 fine, which is $15,000, and so on. The offence provision for which the penalty would increase by two levels is section 29(2). The offence is operating a centralised booking service without being accredited. The penalty is currently a division 5 fine, that is, $8,000. It would be increased by the amendment to a division 3 fine, that is, $30,000.

This will bring the penalty in line with the penalties for operating a passenger transport service without accreditation and operating a taxi service without accreditation. In view of the number of penalty increases, I will not summarise each and every one unless the house wishes me to do so. Under the Primary Produce (Food Safety Schemes) Act there is an amendment. This is simply to deal with a typographical error in the bill.

The new provision to be substituted for section 44 of the Primary Produce (Food Safety Schemes) Act 2004 bill should have referred to section 16(2), not subsection (1). Then we have amendments under the Renmark Irrigation Trust Act. The Upper South-East Dryland Salinity and Flood Management Act no longer exists. A bill to extend its operation beyond 19 December 2012 was defeated in the Legislative Council after this bill was introduced; so it becomes a bit irrelevant, really.

The Water Industry Act 2012 was passed with a reverse onus on directors' liability provision that applied to every offence against the act that could be committed by a body corporate. This is no longer acceptable. Each offence against the bill has now been examined in the light of COAG guidelines.

The Minister for Sustainability, Environment and Conservation was consulted and decisions were made in consultation with the Department of Environment, Water and Natural Resources about the appropriate way to treat each for the purposes of vicarious criminal liability of directors. The amendment I move will amend the water Industry Act in a manner that conforms with the guidelines. Hopefully, those rather lengthy remarks will ultimately save us some time. I suggest that we now go into committee.

Bill read a second time.

Committee Stage

In committee.

Clause 1.

Ms CHAPMAN: I thank the Attorney for outlining in his response the anticipated amendments. I have tried to follow those through. There are a lot of amendments here, but he has categorised them in the groups that essentially increase penalties. As he says, there has been a general attempt to increase penalties consistent with going up to a new divisional level, explaining where he thinks that should be more punitive and, largely, to review penalties that are consistent to a person with X amount and then five times that being applicable to the corporation. I should also say that I know there were a couple of other corrections along the way which seemed to remedy things. In respect of this general upgrade, when was it first decided that there would be some review of the extent of the penalties in each of these pieces of legislation?

The Hon. J.R. RAU: I thank the honourable member for the question. The answer is that there was a second audit at the beginning of 2012 and this identified a number of things, and that is where this has come from. I have to say, if I may, that both for me and for the hardworking people in the Attorney-General's Department it is not a little bit frustrating that the goal posts have moved here. There were particular views which we thought were prevailing at one point.

As you would be aware, member for Bragg, we put an earlier bill through about a year to 18 months ago and we were under the impression that in so doing we had been complying with reasonable requests to move along with this only to discover that there was then a reappraisal so to speak of what was expected of people, and what we had considered to be a fair and reasonable attempt to be compliant was rendered unsatisfactory, which is why we have had to go back and return to this process. Anyway, the point is the time line started last year in terms of the review or the audit. I am advised that the level to which penalties should be increased was not worked out in the second audit. The penalties that needed revision were identified.

Ms CHAPMAN: Yes, I understand all that. We had the second audit; that is why we are here, that is why we have the bill. However, suddenly we have all of these amendments to penalty. While you say that was not in the second audit, I am assuming that is the case because otherwise it would have been in the bill in the first place. I just want to know. You delivered this in late November, we had briefings on it and suddenly we have all these penalties being brought to us, so I wonder where all this has come from. Are we fixing it up because it is convenient or has somebody written to you saying we need to sort this out while we are there and we just omitted it? This is quite substantial change.

The Hon. J.R. RAU: I suspect the member for Bragg is going to love this answer. In order to meet the COAG milestone, the bill had to be introduced in November but, given the body of work that needed to be done, we had not at that stage completed the full recalibration of all of these penalties. The bill was introduced to ensure that there had been formal compliance with the requirements of COAG. The hardworking people in the Attorney-General's Department—in particular Dianne—continued to work away on this. By the time we get to today, that work is complete and that is why there are amendments before the parliament.

Ms CHAPMAN: During the explanation you indicated, I think in relation either to the last bill or the penultimate bill, that you had sought the advice of the Minister for Environment on the question of reverse of onus, but I did not hear you indicate whether you had consulted with any other stakeholders, or in fact in relation to all of the other penalty amendments. At the very least that seems to have covered the ministers for primary industry, transport, environment, emergency services, and yourself on the Fair Trading Act (I assume you cover that) and as the minister for planning. There are a number of pieces of legislation where there are very significant increases in penalty. Were other ministers and other stakeholders consulted at all in relation to these increases?

The Hon. J.R. RAU: I am advised that the other departments and/or ministers involved were consulted.

Ms CHAPMAN: Were any other parties or stakeholders?

The Hon. J.R. RAU: No.

Ms CHAPMAN: Whilst the review of penalties is something that is not uncommon and a number of these may well be appropriate, we will certainly have a look at whether in each of these instances they are appropriate. I will not hold up the bill today obviously in seeking to do that. However, I notice in particular one which is quite a standout, and that is to add under the Heritage Places Act not only an increase in penalty—doubling from $25,000 to $50,000—but that there will be a new penalty applying to neglect of a building or place, as distinct from there being some positive—presumably to bulldoze or to in some way destroy a heritage place.

I have to say that this is quite an extraordinary extension, not least because I would imagine it is causing some considerable alarm to persons who own heritage buildings and who are not in a position to invest sometimes very substantial moneys to maintain their current state of repair or disrepair, and they continue to crumble so to speak. I would have thought that the government itself would be placing itself in a very difficult position, as the owner and custodian of a number of heritage places, to expose itself—or members of its board in government entities—to that vulnerability or to prosecution in that way. I put the Attorney on notice that I think that is a very significant change and it is one on which we certainly may wish to make some further comment.

The other is in relation to water and water use, which I think is under amendment 8. I think the penalty increases with respect to taking water from an irrigation trust or supplying to another may well be justified. As to obligations to erect fences, etc., I think does raise some new aspects. Again, we will have a look at that in some detail, but if there are substantial penalties to that we will need to give it some careful consideration.

I notice (I think it is under proposed amendment No. 11) under the transport act that again there are significant penalties. There is also a massive increase from $8,000 to $30,000 for anyone attempting to operate a central booking agency without accreditation. Again, that may have merit, but we would certainly have to have a look at that. I recall, because that also related to taxis, that when this bill was being considered as to what acts it should apply to and how it should remedy it, there were a number of acts that did not turn up in this legislation, in anticipation that certain laws would repeal other acts and that there would be no need to cover them.

I am not quite sure where this comes in, but on my recollection the Co-operatives Act was not added in because we are about to deal with that at another time and that it is anticipated to be repealed. We dealt with the Rail Safety Act last year and we now have a national system. We have not yet dealt with the heavy vehicle national law. I think Queensland has passed its bill recently and we are yet to deal with it. The South Eastern Water Conservation and Drainage Act is one which does not show up here because it was expected that that would be repealed and replaced by another piece of legislation.

I have to say that, whilst it may be that a number of these pieces of legislation will pass through the parliament and the expected repeal will come to fruition, as a member of the parliament I think it is quite offensive to not include legislation even if there is an expected repealing of legislation in the future. We do not know what is going to happen between now and the time of those acts being dealt with in the way that the government wants them to be dealt with.

As I say, some of them may pass without moment, and be repealed as a result of that, but I think it is rather rude to the parliament, Attorney, for some of these to be omitted. I am disappointed that they have not turned up in the legislation, because clearly we still have not dealt with them. Some of them we may deal with in the immediate future, but some may be a long way off. In any event, I do not think that you or anyone in your government should presume that the parliament is just going to rubber-stamp what you want.

With those few words, I will not raise any further questions on the amendments that have been outlined, but will have a good look at them between houses. I just make a final comment to say that I am disappointed that the Attorney has not taken the opportunity to heed the request for a defence to be introduced and that the provisions in the regulation which I have described as sloppy and inappropriate have not been removed. Nevertheless, that disappointment will remain, it seems.

Clause passed.

Clauses 2 to 15 passed.

New clauses 15A to 15E.

The Hon. J.R. RAU: I move:

Page 10, after line 23—Before clause 16 insert:

15A—Amendment of section 48—Governor to give decision on development

Section 48(14), penalty provision—delete the penalty provision and substitute:

Penalty: Division 3 fine.

Default penalty: $500.

15B—Amendment of section 49—Crown development and public infrastructure

Section 49(14a), penalty provision—delete the penalty provision and substitute:

Penalty: Division 3 fine.

Default penalty: $500.

15C—Amendment of section 49A—Electricity infrastructure development

Section 49A(16), penalty provision—delete the penalty provision and substitute:

Penalty: Division 3 fine.

Default penalty: $500.

15D—Amendment of section 69—Emergency orders

Section 69(12), penalty provision—delete the penalty provision and substitute:

Penalty: Division 4 fine.

Default penalty: $200.

15E—Amendment of section 71—Fire safety

Section 71(14), penalty provision—delete the penalty provision and substitute:

Penalty: Division 4 fine.

Default penalty: $200.

New clauses inserted.

Clause 16 passed.

New clauses 16A to 16D.

The Hon. J.R. RAU: I move:

Page 11, after line 29—Before clause 17 insert:

16A—Amendment of section 61—Electrical installation work

(1) Section 61(1), penalty provision—delete '$5,000' and substitute '$10,000'

(2) Section 61(4), penalty provision—delete '$5,000' and substitute '$10,000'

16B—Amendment of section 61A—Unsafe installation of electrical equipment

Section 61A, penalty provision—delete '$5,000' and substitute '$10,000'

16C—Amendment of section 84—Unlawful interference with electricity infrastructure or electrical installation

Section 84(1), penalty provision—delete '$10,000' and substitute '$20,000'

16D—Amendment of section 85—Unlawful taking of electricity, interference with meters or positioning of lines

Section 85(1), penalty provision—delete '$10,000' and substitute '$20,000'

New clauses inserted.

Clause 17.

The Hon. J.R. RAU: I move:

Page 11, line 32 [clause 17, inserted subsection (3)]—Delete 'This section' and substitute: 'Subsection (1)'

Amendment carried; clause as amended passed.

Clauses 18 to 25 passed.

New clause 25A.

The Hon. J.R. RAU: I move:

Page 13, after line 18—Before clause 26 insert:

25A—Amendment of section 43—Unlawful actions and representations

Section 43(2), penalty provision—delete the penalty provision and substitute:

Maximum penalty:

In the case of a body corporate—$25,000.

In any other case—$5,000 or imprisonment for 6 months.

New clause inserted.

Clauses 26 and 27 passed.

New clause 27A.

The Hon. J.R. RAU: I move:

Page 14, after line 1—Before clause 28 insert:

27A—Amendment of section 86—Fire safety at premises

Section 86(4), penalty provision—delete the penalty provision and substitute:

Maximum penalty:

(a) if the offender is a body corporate—$50,000;

(b) if the offender is a natural person—$10,000.

New clause inserted.

Clauses 28 to 31 passed.

New clauses 31A and 31B.

The Hon. J.R. RAU: I move:

Page 16, after line 13—Before clause 32 insert:

31A—Amendment of section 81—Unlawful interference with distribution system or gas installation

Section 81, penalty provision—delete '$10,000' and substitute '$20,000'

31B—Amendment of section 82—Unlawful abstraction or diversion of gas

Section 82(1), penalty provision—delete '$10,000' and substitute '$20,000'

New clauses inserted.

Clauses 32 to 36 passed.

New clause 36A.

The Hon. J.R. RAU: I move:

Page 19, after line 1—Before clause 37 insert:

36A—Amendment of section 36—Damage or neglect

Section 36(3), penalty provision—delete '$25,000' and substitute '$50,000'

New clause inserted.

Clauses 37 to 41 passed.

New clauses 41A to 41C.

The Hon. J.R. RAU: I move:

Page 21, after line 1—Before clause 42 insert:

41A—Amendment of section 40—Protection and facilitation of systems

Section 40(8), penalty provision—delete the penalty provision and substitute:

Maximum penalty:

(a) in the case of a body corporate—$100,000;

(b) in the case of a natural person—$20,000.

Expiation fee: $750.

41B—Amendment of section 62—Protection of irrigation system etc

Section 62, penalty provision—delete the penalty provision and substitute:

Maximum penalty:

(a) in the case of a body corporate—$100,000;

(b) in the case of a natural person—$20,000.

Expiation fee: $750.

41C—Amendment of section 63—Unauthorised use of water

Section 63, penalty provision—delete the penalty provision and substitute:

Maximum penalty:

(a) in the case of a body corporate—$100,000;

(b) in the case of a natural person—$20,000.

Expiation fee: $750.

New clauses inserted.

Clauses 42 to 47 passed.

New clauses 47A and 47B.

The Hon. J.R. RAU: I move:

Page 22, after line 7—Before clause 48 insert:

47A—Amendment of section 27—Requirement to report notifiable conditions

(1) Section 27(1), penalty provision—delete the penalty provision and substitute:

Maximum penalty:

In the case of an exotic disease—$10,000;

In any other case—$2,500.

Expiation fee: For an offence against paragraph (a) or (b)—$210.

(2) Section 27(2), penalty provision—delete the penalty provision and substitute:

Maximum penalty:

In the case of an exotic disease—$10,000;

In any other case—$2,500.

Expiation fee: $210.

47B—Amendment of section 33—Prohibition on entry of livestock or other property absolutely or without required health certificate etc

Section 33(4), penalty provision—delete the penalty provision and substitute:

Maximum penalty: $5,000.

Expiation fee: $315.

New clauses inserted.

Clause 48 passed.

Clause 49.

The Hon. J.R. RAU: I move:

Page 22, line 34 [clause 49, inserted section 80(3)]—Delete '17,'

Amendment carried; clause as amended passed.

Clauses 50 to 53 passed.

New clauses 53A to 53L.

The Hon. J.R. RAU: I move:

Page 24, after line 33—Before clause 54 insert:

53A—Amendment of section 5—Application of Act

Section 5(5), penalty provision—delete the penalty provision and substitute:

Penalty: Division 4 fine.

53B—Amendment of section 27—Accreditation of operators

Section 27(1), penalty provision—delete the penalty provision and substitute:

Penalty: Division 3 fine.

53C—Amendment of section 28—Accreditation of drivers

Section 28(1), penalty provision—delete 'Division 6 fine' and substitute: 'Division 5 fine'

53D—Amendment of section 29—Accreditation of centralised booking services

Section 29(2), penalty provision—delete the penalty provision and substitute:

Penalty: Division 3 fine.

53E—Amendment of section 31—Conditions

Section 31(7), penalty provision—delete the penalty provision and substitute:

Penalty:

(a) In the case of an accreditation under Division 1—Division 3 fine;

(b) In the case of an accreditation under Division 2—Division 5 fine;

(c) In the case of an accreditation under Division 3—Division 3 fine.

Expiation fee: In the case of an accreditation under Division 2—$315.

53F—Amendment of section 35—Related matters

Section 35(1), penalty provision—delete the penalty provision and substitute:

Penalty: Division 4 fine.

53G—Amendment of section 36—Disciplinary powers

Section 36(9), penalty provision—delete the penalty provision and substitute:

Penalty: Division 3 fine.

53H—Amendment of section 39—Service contracts

Section 39(4), penalty provision—delete the penalty provision and substitute:

Penalty: Division 3 fine.

53I—Amendment of section 42—Assignment of rights under contract

Section 42(1), penalty provision—delete the penalty provision and substitute:

Penalty: Division 3 fine.

53J—Amendment of section 45—Requirement for licence

Section 45(8), penalty provision—delete the penalty provision and substitute:

Penalty: Division 3 fine.

53K—Amendment of section 49—Transfer of licences

Section 49(1), penalty provision—delete the penalty provision and substitute:

Penalty: Division 3 fine.

53L—Amendment of section 54—Inspections

(1) Section 54(14), penalty provision—delete the penalty provision and substitute:

Penalty: Division 4 fine.

(2) Section 54(15), penalty provision—delete the penalty provision and substitute:

Penalty: Division 4 fine.

(3) Section 54(18), penalty provision—delete the penalty provision and substitute:

Penalty: Division 5 fine.

Expiation fee: $315.

New clauses inserted.

Clauses 54 to 57 passed.

Clause 58.

The Hon. J.R. RAU: I move:

Page 26, line 25 [clause 58, inserted section 44(2), definition of prescribed offence]—

Definition of prescribed offence—delete '16(1)' and substitute '16(2)'

Amendment carried; clause as amended passed.

New clauses 58A to 58C.

The Hon. J.R. RAU: I move:

Page 26, after line 27—Before clause 59 insert:

58A—Amendment of section 41—Protection and facilitation of systems

Section 41(8), penalty provision—delete the penalty provision and substitute:

Maximum penalty:

(a) in the case of a body corporate—$100,000;

(b) in the case of a natural person—$20,000.

Expiation fee: $750.

58B—Amendment of section 67—Protection of irrigation system etc

Section 67, penalty provision—delete the penalty provision and substitute:

Maximum penalty:

(a) in the case of a body corporate—$100,000;

(b) in the case of a natural person—$20,000.

Expiation fee: $750.

58C—Amendment of section 68—Unauthorised use of water

Section 68, penalty provision—delete the penalty provision and substitute:

Maximum penalty:

(a) in the case of a body corporate—$100,000;

(b) in the case of a natural person—$20,000.

Expiation fee: $750.

New clauses inserted.

Clauses 59 to 67 passed.

Clause 68.

The Hon. J.R. RAU: I move:

Page 30, lines 1 to 32 (inclusive)—Delete Part 50

Amendment carried; clause negatived.

Clause 69 passed.

New part 52.

The Hon. J.R. RAU: I move:

Page 30, after line 37—After clause 69 insert:

Part 52—Amendment of Water Industry Act 2012

70—Amendment of section 103—General defence

Section 103—after subsection (2) insert:

(3) Subsection (1) does not apply in relation to a person who is charged with an offence under section 104.

71—Substitution of section 104

Section 104—delete the section and substitute:

104—Offences by bodies corporate

(1) If a body corporate is guilty of a prescribed offence, each director of the body corporate is guilty of an offence and liable to the same penalty as is prescribed for the principal offence when committed by a natural person unless the director proves that he or she could not by the exercise of due diligence have prevented the commission of the offence.

(2) If a body corporate is guilty of any other offence against this Act (other than an offence against the regulations), each director of the body corporate is guilty of an offence and liable to the same penalty as is prescribed for the principal offence when committed by a natural person if the prosecution proves that—

(a) the director knew, or ought reasonably to have known, that there was a significant risk that such an offence would be committed; and

(b) the director was in a position to influence the conduct of the body corporate in relation to the commission of such an offence; and

(c) the director failed to exercise due diligence to prevent the commission of the offence.

(3) Subsection (2) does not apply if the principal offence is an offence against section 11, 36, 39, 45, 49, 50(5), 50(6), 51, 53, 54, 56(5), 57, 59, 60, 69, 70, 76, 77, 78, 79, 80, 88, 92, 97, 100, 101, 108 or Schedule 2 Part 8.

(4) The regulations may make provision in relation to the criminal liability of a director of a body corporate that is guilty of an offence against the regulations.

(5) In this section—

prescribed offence means an offence against section 18, 27, 67 or 68.

New part inserted.

Title passed.

Bill reported with amendment.

Third Reading

The Hon. J.R. RAU (Enfield—Deputy Premier, Attorney-General, Minister for Planning, Minister for Industrial Relations, Minister for Business Services and Consumers) (17:59): After that ferocious effort at legislation—

The DEPUTY SPEAKER: It was a good team effort.

The Hon. J.R. RAU: I have never seen such a machine-gun episode of legislating in my time, and I congratulate you on the way you dealt with it. It was magnificent, Mr Deputy Speaker: top shelf, champagne legislating. I move:

That this bill be now read a third time.

Bill read a third time and passed.


At 18:00 the house adjourned until Thursday 7 March 2013 at 10:30.


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