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Part 6-3—Debt recovery

Part 6-3 Debt recovery

Division 1 Simplified outline of this Part

166   Simplified outline of this Part

Certain amounts paid under the scheme may become a debt due to the Commonwealth. For example, if a redress payment is paid to the wrong person, that payment is a debt due to the Commonwealth and may be recovered under this Part.

This Part also allows for funding contribution or late payment penalty that is payable by an institution or a person to be recoverable as a debt due to the Commonwealth.

Division 2 Debt recovery

167   Recovery of amounts (other than funding contribution and late payment penalty)

             (1)  If an amount has been paid to a person or an institution (the recipient ) under this Act, the amount is a debt due to the Commonwealth only to the extent expressly provided for by this section.

             (2)  If the amount paid to the recipient was not payable because:

                     (a)  the amount was paid to the wrong person or institution; or

                     (b)  the amount exceeds the amount payable to the recipient;

then the amount paid, or the excess, is a debt due to the Commonwealth by the recipient.

             (3)  If the amount paid to the recipient was paid wholly or partly because of a false or misleading statement, or a misrepresentation, by the recipient or another person, then an amount equal to so much of the amount paid as is attributable to the false or misleading statement, or the misrepresentation, is a debt due to the Commonwealth by the recipient.

             (4)  If:

                     (a)  the recipient was required under section 181 to notify the Operator about a matter; and

                     (b)  the recipient did not comply with the requirement; and

                     (c)  had the Operator been notified as required, the amount that was paid to the recipient would not have been payable;

then an amount equal to so much of the amount paid as is attributable to the failure to comply with the requirement is a debt due to the Commonwealth by the recipient.

             (5)  A debt due by the recipient under this section in relation to an amount arises at the time the amount was paid to the recipient.

168   Recovery of funding contribution and late payment penalty

                   The following amounts may be recovered by the Commonwealth from an institution or a person as debts due to the Commonwealth:

                     (a)  funding contribution that is due and payable by the institution or person;

                     (b)  late payment penalty that is due and payable by the institution or person.

Note:          For cases where a person may be liable to pay funding contribution, see sections 123, 131 and 141.

169   Legal proceedings to recover debt

                   A debt due to the Commonwealth under this Part is recoverable by the Commonwealth in a court of competent jurisdiction.

170   Arrangement for payment of debt

             (1)  The Operator may enter into an arrangement with a person or an institution under which the person or institution is to pay a debt, owed by the person or institution to the Commonwealth under this Part, or the outstanding amount of such a debt, in a way set out in the arrangement.

             (2)  An arrangement entered into under subsection (1) has effect, or is taken to have had effect, on and after the day specified in the arrangement as the day the arrangement commences (whether that day is the day the arrangement is entered into or an earlier or later day).

             (3)  If an arrangement entered into under subsection (1) does not specify a day as mentioned in subsection (2), it has effect on and after the day on which it is entered into.

             (4)  The Operator may terminate or alter an arrangement entered into under subsection (1):

                     (a)  at the request of the person or institution; or

                     (b)  after giving 28 days’ notice to the person or institution of the proposed termination or alteration; or

                     (c)  without notice, if the Operator is satisfied that the person or institution has failed to disclose material information about the person’s or institution’s true capacity to repay the debt.

171   Recovery of amounts from financial institutions

Payment into wrong account

             (1)  This section applies if:

                     (a)  an amount is paid under this Act to a financial institution for the credit of an account kept with the financial institution; and

                     (b)  the Operator is satisfied that the payment was intended to be made to someone who was not the person or one of the persons in whose name or names the account was kept.

Notice to financial institution requiring repayment

             (2)  The Operator may give a written notice to the financial institution setting out the relevant matters referred to in paragraphs (1)(a) and (b) and requiring the financial institution to pay to the Commonwealth, within a reasonable period stated in the notice, the lesser of the following amounts:

                     (a)  the amount of the payment, as stated in the notice;

                     (b)  the amount standing to the credit of the account when the notice is given to the financial institution.

Offence for contravening notice

             (3)  A financial institution must comply with a notice given to it under subsection (2).

Penalty:  300 penalty units.

             (4)  It is a defence to a prosecution of a financial institution for failing to comply with a notice given to it under subsection (2) if the financial institution proves that it was incapable of complying with the notice.

Note:          A defendant bears a legal burden in relation to the matter in this subsection (see section 13.4 of the Criminal Code ).

Amount recovered reduces debt

             (5)  Any amount recovered by the Commonwealth from a financial institution under this section reduces the amount of a debt referred to in subsection 167(1) (as it relates to paragraph 167(2)(a)).

172   Repayment of recovered amount to participating institutions

                   If:

                     (a)  the Commonwealth recovers an amount under this Part (other than paragraph 167(2)(a)); and

                     (b)  all or part of the amount relates to either or both of the following payments:

                              (i)  a redress payment;

                             (ii)  a counselling and psychological services payment; and

                     (c)  a participating institution has paid funding contribution in relation to that payment;

then the Commonwealth must repay the institution so much of that funding contribution as the Operator considers relates to the amount recovered.

Note:          For the appropriation for the refund, see section 77 of the Public Governance, Performance and Accountability Act 2013 .