Family Law Amendment Regulations 2004 (No. 1) 2004 No. 319
EXPLANATORY STATEMENT
STATUTORY RULES 2004 No. 319
ISSUED BY THE AUTHORITY OF THE ATTORNEY-GENERAL
FAMILY LAW ACT 1975
FAMILY LAW AMENDMENT REGULATIONS 2004 (No. 1)
Subsection 125(1) of the Family Law Act 1975 (the Act) provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing all matters that are required or permitted by the Act to be prescribed, or are necessary or convenient to be prescribed for carrying out or giving effect to the Act.
Schedule 6 to the Family Law Amendment Act 2003 (the Amendment Act) commences on 17 December 2004. Schedule 6 inserts a new Part VIIIAA into the Act, to enable a court exercising jurisdiction under the Act (the court) to make orders binding third parties to give effect to property settlement proceedings under the Act. Pursuant to new subsection 90AJ(2) of the Act the court will be able to make an order in relation to the third party's expenses. New subsection 90AJ(4) provides that regulations may be made to enable third parties to recover expenses reasonably incurred in complying with an order of the court, where the court has not made an order for that purpose.
The Regulations amend the Family Law Regulations 1984 (the Principal Regulations) to provide for situations where the court has not made an order in relation to the third party's expenses necessarily incurred in compliance with the court orders.
The Regulations insert a new regulation 15AA into the Principal Regulations which details that a third party may charge fees to cover reasonable expenses necessarily incurred in compliance with the property settlement order, without needing a separate court order. The Regulations give examples of the fees which may reasonably be charged and provide that each of the parties to the marriage is liable for half of the total amount of such fees.
Details of the Regulations are as follows:
Regulation 1 provides that the name of the Regulations is the Family Law Amendment Regulations 2004 (No. 1).
Regulation 2 provides for the Regulations to commence on the date of commencement of Schedule 6 of the Amendment Act, which is 17 December 2004.
Regulation 3 provides that Schedule 1 amends the Family Law Regulations 1984.
Item 1 inserts a new regulation 15AA called 'third party expenses'. Subregulation 15AA(1) makes it clear that regulation 15AA operates where the court has not made an order under subsection 90AJ(2) of the Family Law Act 1975 (the Act) about the expenses incurred by a third party. It does this by reference to subsection 90AJ(4) of the Act which specifically allows regulations to be made to cover the situation where the court has not made an order.
Subregulation 15AA(2) provides for third parties to charge reasonable fees to cover the reasonable expenses that have been incurred in complying with a court order. The expenses must have been a necessary result of compliance with the order.
Subregulation 15AA(3) specifies that the fees are for reasonable expenses incurred in complying with the order about the distribution of the property of the parties to a marriage. It also gives examples of the types of expenses that may be covered. For example, government charges might include stamp duty and valuation fees, transmission of documents might include the cost of facsimiles. Not all the examples in this list will be expenses incurred in every case. The list is intended to be a guide for third parties as to the type of expenses that may be considered to be reasonably incurred and is not an exhaustive list.
Subregulation 15AA(4) provides that it is the parties to the marriage who are liable to pay for the third party's expenses. Each party to the marriage has to pay half of the total amount. This split between the parties to a marriage is specifically provided for under paragraph 90AJ(4)(b) of the Act. The intention is to provide a standard method for sharing of the costs between the parties. If parties are concerned this is not just and equitable, they could go to the court pursuant to subsection 90AJ(2) and seek an order.
Subregulation 15AA(5) provides that the court has the jurisdiction to determine the reasonableness of the fees and to make an order to collect and recover the fees charged by a third party. This would provide a debt recovery jurisdiction additional to that which already exists in State and Territory court systems. It also makes clear that the reasonableness of the charges will be open to scrutiny by the court.
Overview
The Family Law Amendment Regulations 2004 (No. 1) were introduced to address gaps in the existing framework for third-party expenses in property settlement proceedings under the Family Law Act 1975. Enacted by the Parliament of Australia, these Regulations were designed to ensure that third parties involved in family law proceedings could recover their reasonable expenses when the court had not specifically ordered reimbursement. This was in line with the policy objective of providing a streamlined and equitable process for handling third-party costs in family law matters. The Regulations provide a clear guideline for what constitutes reasonable expenses and stipulate that these costs are to be shared equally between the parties involved in the marriage. This approach aimed to alleviate the administrative burden on the courts while ensuring that third parties are fairly compensated for their services.
Scope and Application
The Family Law Amendment Regulations 2004 (No. 1) apply to individuals and entities involved in property settlement proceedings under the Family Law Act 1975, particularly those acting as third parties in such proceedings. These regulations primarily affect financial service providers, accountants, and legal professionals who may incur expenses while complying with court orders during property settlements. They provide a framework for these third parties to recover reasonable expenses from the parties to the marriage when the court has not specifically ordered for such expenses. The regulations apply nationally, given their foundation in Commonwealth legislation, and they extend the application of the Family Law Act 1975 to ensure that third parties can seek reimbursement for necessary expenses incurred in the execution of court orders. This is particularly relevant for the costs associated with government charges like stamp duty and valuation fees, as well as transmission costs such as facsimile expenses. The regulations do not introduce any exclusions but provide a clear method for sharing the costs between the parties to the marriage, with each party responsible for half of the total fees.
Key Provisions
The Family Law Amendment Regulations 2004 (No. 1) primarily amend the Family Law Regulations 1984 to introduce provisions that allow third parties involved in property settlement proceedings under the Family Law Act 1975 to charge reasonable fees for expenses incurred. Regulation 15AA, introduced by these Regulations, details the circumstances under which third parties can charge such fees. Regulation 15AA(1) clarifies that this regulation applies when the court has not made an order about the third party's expenses, as allowed under section 90AJ(4) of the Act. Regulation 15AA(2) specifies that third parties can charge fees for reasonable expenses necessarily incurred in complying with a court order. Examples of such expenses include stamp duty, valuation fees, and the cost of facsimiles for document transmission (Regulation 15AA(3)). Regulation 15AA(4) stipulates that the parties to the marriage are liable for these expenses, with each party responsible for half of the total amount. Regulation 15AA(5) grants the court jurisdiction to determine the reasonableness of the fees and to make orders for their collection and recovery.
These Regulations impose specific obligations on the parties to a marriage undergoing property settlement proceedings. Under Regulation 15AA(4), each party is required to contribute equally to the fees charged by third parties for expenses incurred in compliance with court orders. This obligation ensures that the costs associated with property settlement are shared fairly between the parties. Additionally, the court retains the authority to assess the reasonableness of these fees and to make orders for their collection and recovery, ensuring that the fees charged are justifiable and proportionate (Regulation 15AA(5)).
The Regulations do not explicitly detail offences or penalties for breach; however, the Act provides for potential consequences. Section 120 of the Family Law Act 1975 allows the court to make orders that are necessary to give effect to the Act, including orders for the payment of expenses. Failure to comply with such an order could lead to enforcement actions, including fines or other penalties as determined by the court. Additionally, any disputes regarding the reasonableness of fees charged by third parties can be brought before the court, which can make orders as it deems just and equitable under section 90AJ(2). The penalties for non-compliance with court orders are not explicitly stated in the Regulations but are generally governed by the court's discretion and the provisions of the Family Law Act 1975.