[Andrew Butcher]

Legislative amendments assented today.

Please find a redacted version of the assented bill here: COVID19 legislation amenment (emergency measures – miscellaneous) bill 2020_Redacted

The full (41 pages) of all changes can be found here: COVID19 legislation amenment (emergency measures – miscellaneous) bill 2020

Key points are:

• Amendment to Section 511 – extension of time to recover a shortfall in general income from 2 to 10 years.
• New Section 747AA – definition of ‘prescribed period’
• New Section 747AB – conditions regarding the recovery of unpaid rates and charges, the prescribed period is important.

Please take the time to read these provisions as they may have impact on your council.

The notes shown still refer to proposed Sections 747AD and Section 747AC that were defeated in the upper house, not sure if they have been identified by Parliamentary Officers.

Regards,
Andrew

[Anne Jones]

I would be interested is know how other Council’s interpret 747AB, whether demand letters from Debt Collection Agencies or, the commencement of legal action ie. Summons, is determined as, ‘proceeding for the recovery of rates or charges’
Thanks
Anne Jones
Berrigan Shire Council

[Andrea Dolan]

Hi Anne
My understanding is that if your demand letter is a Notice of Intent then that is the commencement of legal action. I believe we are doing everything possible under the OLG guidelines that were released last year and that in the current climate, Council’s would be doing everything possible to ensure they have engaged their ratepayers in the opportunity to make arrangements/extension to pay. We at CBCity will be looking at our Mayor Rates Relief package and it’s outcomes in a couple of months, and then discussing recommencing debt recovery.
Andrea

[Darryl Telfer]

Just my view FWIW. Its new to all of us and I am sure there are a lot of different opinions.

The legislation clearly places additional (legislative) onus on Council to ensure legal action is the last available option. As usual, more legislation means more work – but we are in an unusual situation at present.

As Anne has suggested, there doesn’t appear to be a definition of “proceedings”.

Looking at the legislation (a dangerous but sometimes necessary pastime);
1. S 747AB refers to commencement of proceedings for the recovery of a rate or charge under s 712

2. S 712 (3) states “In any proceedings for the recovery of a rate or charge, a court may decide any matter that is called into question and that is relevant to the determination of the proceedings, even though the matter would otherwise be beyond the court’s jurisdiction.”

To me this (s 712 (3)) indicates that “proceedings” in s 747AB means court/legal action so I would not be doing anything that mentions court action, unless Council has considered the 4 points at s 747AB (a) to (d) i.e. arrangements, financial counselling, mediation, deferral or waiver etc.

What Andrea suggests re a demand letter being a Notice of Intent is valid – if the demand states legal action will follow then the demand is effectively the “commencement of proceedings” (and if you aren’t going to take legal action then don’t threaten it).

On the other hand, I don’t believe Council’s should be prevented from sending reminders and asking for payment – it would be irresponsible to not do these things. However s747AB effectively enforces the concepts of engagement that are promoted through the OLG Debt Management and Hardship Guidelines. Unless that engagement occurs (or all reasonable attempts to engage have failed), there is no way Council staff could report to Council that the 4 points under s747AB have been properly considered and recommend to Council that “proceedings” commence (via demand / Notice of Intent).

So what do we do until 26/9/2020 (or later date as regulations may determine)??.
I’d suggest still sending reminder notices then start engaging with any ratepayers that still haven’t paid or made an arrangement within the allowed time – and effectively check off the 4 points at s747AB (arrangements, financial counselling, mediation, deferral or waiver etc) before getting Council endorsement to go a demand/notice of intent and beyond (if that’s appropriate for you/your Council). If you have a relief package an/or hardship policy/procedure, then you are in a better position to consider the 4 points under s747AB.

[Skye Collett]

Hi All,

My interpretation was that the amendments refer to legal action in the courts, so primarily a SOC being the first instance of requiring Council to adhere to the 4 requirements of arrangements, financial counselling etc. For existing legal matters currently on hold, I would expect that unless Council were in a position to definitively determine that a ratepayer was not impacted by COVID19 these matters would need to remain on hold also for six months.

I am very interested to hear what other Councils views are also.. at this stage this is just my interpretations and we have yet to make a final determination regarding the best way forward. Currently all action including early stage has been on hold since approximately mid march. I am now just seeking all and every bit of information I can get my hands on.

We currently have a 5 step collection process for new matters prior to any legal action commencing at no cost to the rate payer.
Internal Reminder
Internal Notice of Legal Action
Attempt contact across all alternative contact numbers and emails.
Referral to Legal Service Provide where a contact letter is sent
Letter of Demand sent by the Legal Service Provider.

So effectively 5 opportunities for ratepayers to engage with us over the course of about 2.5 months prior to consideration for SOC.

I am hopeful that we may still be able to do some if not all of these activities provided that correspondence is temporarily tailored to include a softer collections tone, COVID19 information regarding rate payers accessibility to assistance under the amendments and more extensive longer term arrangements for not impacted ratepayers to encourage them to engage and resolve the debts sooner.

Thoughts?

[Emma Murphy]

Very interested to hear how Councils are going to be able to ‘consider a-d’ of the new legislation.
We aren’t doing much (barely any) debt recovery, however I do need to move forward on one ratepayer. (significant debt, recovery had commenced prior to COVID – and pretty confident the Ratepayer isn’t covid effected)

This is my take/consideration on moving forward with this account…thoughts would be appreciated.

(a) whether the payment of the rate or charge could be made in instalments or by way of some other financial arrangement
Yes – it could, and yes Council would be open to an arrangement, this is difficult to achieve when the ratepayers doesn’t contact Council.

(b) whether the person should be referred to a financial counsellor
Yes probably, can suggest, but how long do you wait for them to initiate this process, in rural areas, finding one is also challenging – noted the four services provided in the Q&A.

(c) whether mediation or alternative dispute resolution should be attempted first,
not sure how you tick this box….I feel like I do this in step a.

(d) whether interest on the unpaid amount should be deferred or waived
Yes naturally this could be an option – which is reasonably easy to initiate.

And, I presume if I tick all the a-d boxes, I could proceed with the Statement of Claim.

Thanks in advance for anyone who can direct me.

[Author]

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