Australia: The New Associations Incorporations Act 2015 (WA) – powers of the Commissioner

This is the ninth of a series of legal updates that Kott Gunning is producing throughout 2016 on the key features and reforms under the new Associations Incorporation Act 2015 (WA) (Act).

This instalment deals with the powers of the Commissioner under the Act.

The general functions of the Commissioner

The Commissioner is appointed by the Minister for Commerce and has the responsibility to administer the Act, acting through the Department of Commerce (Department).

The functions of the Commissioner include the following:

  • facilitate the establishment and operation of associations in accordance with the Act;
  • promote and encourage compliance with the Act;
  • receive and investigate complaints relating to non-compliance;
  • conduct compliance and educational activities;
  • investigate, research and publish reports on matters concerning associations;
  • report to the Minister;
  • perform any other functions conferred under the Act.

The Commissioner may in writing delegate any function to any other person employed by the Department. This does not limit the ability of the Commissioner to perform any function through an officer or agent.

Granting Incorporation

An association is eligible for incorporation under the Act if it is formed for and carries on one or more particular purposes, or any purpose approved by the Commissioner.

The Commissioner can require that an association give public notice of the application to incorporate.

The Commissioner grants the certificate of incorporation if satisfied that the association is eligible under the Act, the rules comply with the Act, and the name of the association is appropriate.

The Commissioner must not incorporate an association if it is more appropriate for the association to be incorporated under some other law or the incorporation would be against the public interest.

Management Committee

The Act prohibits certain persons (such as an undischarged bankrupt or persons convicted of an offence involving fraud or dishonesty punishable on conviction by 3 months or more imprisonment) from acting as a member of the management committee without the leave of the Commissioner.

Annual information statement to be provided to Commissioner

Within 6 months after the end of each financial year each association must provide to the Commissioner a written statement confirming:

  • the association's street address (and postal address if different);
  • the association continues to have at least 6 members who have full voting rights under the association's rules;
  • the date on which the association held its most recent annual general meeting;
  • the revenue of the association for the most recent financial year.

Within three months after the end of the financial year, an incorporated association may apply to the Commissioner for a declaration that the association is a tier 1, or tier 2, association for the financial year. The Commissioner may make a declaration if he or she is satisfied that unusual and non-recurring circumstances warrant the making of the declaration.

Commissioner may require information or documents

The Commissioner can require an association to produce documents relating to its financial affairs. A penalty of $2,750 applies.

The Commissioner may direct that an association to cause an audit of all, or part, of the associations financial records. The auditor's report must be lodged with the Commissioner.

The Commissioner may request a copy of the association's register of members. The association must comply with this request within 14 days after it is made. A penalty of $5,000 applies.

If it appears to the Commissioner that a person is, or may be, the holder of an office provided for in the rules of an association, the Commissioner may by written notice require the person:

  • to give the Commissioner written details of the person's residential address; and
  • a statement showing whether the person holds, or has held, the specified office, and (if the person has held the office) when the person ceased to hold it. A penalty of $5,000 applies.

Documents kept by the Commissioner

The Commissioner must keep a copy of:

  • a Register of incorporated associations;
  • the rules of each association;
  • any alteration to the rules;
  • every other document required by the Act to be lodged with the Commissioner.

It is sufficient for a person to lodge documents with the Commissioner by facsimile or by email. The Commissioner can require any document or information provided to be verified by Statutory Declaration.

Change of name or rules

An association can alter its rules but only by special resolution. The association must lodge the following documents with the Commissioner within one month of making such a special resolution:

  • a notice of the special resolution setting out the alterations;
  • a certificate in approved form; and
  • a consolidated copy of the rules incorporating the alterations.

An association can change its name by using the process for rule alteration, but the change will not take effect unless and until the Commissioner approves the change.

Commissioner may refuse lodgement

The Commissioner may refuse the lodgement of any document if the Commissioner considers that the document:

  • contains matter contrary to law;
  • has not been prepared in good faith;
  • contains false or misleading information;
  • is in some way incomplete;
  • is non-compliant with the Act;
  • contains error, alteration or erasure;
  • if submitted in electronic format is not readily accessible so as to be unusable.

If a document is refused the Commissioner may request that it be amended or that a new document be prepared and re-lodged.

Commissioner may direct that a general meeting be convened

The Commissioner may in writing direct the office holder who has the power to convene a general meeting under the rules of the association, to convene a general meeting within a specified period.

The Commission may also require that specified matters be discussed and determined at the general meeting. A penalty of $5,000 applies for failure to comply with the Commissioner's direction.

The Commissioner, or a person authorised by the Commissioner, may attend the meeting convened and take part in the discussion of the relevant dispute or matter (but may not vote or be counted as part of the quorum).

Application for Statutory Manager by Commissioner

The Commissioner may apply to the State Administrative Tribunal for the appointment (or revocation of appointment) of a Statutory Manager to administer the affairs of an association. A copy of the application must be given to the association which becomes a party to the application.

A Statutory Manager must report to the Commissioner on the affairs of the association as directed by the Commissioner. A penalty of $10,000 applies.

The winding up or cancellation of incorporation

The Commissioner (amongst others) may make an application to wind up an association.

An association seeking to cancel its incorporation and dispose of property under part 10 of the Act must apply to the Commissioner for approval of the distribution plan and cancellation of incorporation. The Commissioner may require that public notice be given of the application and distribution plan.

Cancellation by Commissioner on certain grounds

The Commissioner may issue a 'show cause' notice to an association if the Commissioner has reasonable grounds to believe the association:

  • was not eligible at the time of incorporation; or
  • contravened section 17 (i.e. must be carried on for the designated purpose, have 6 voting members, and no pecuniary gain for members); or
  • suspended operations for more than one year; or
  • resolved to wind up but no person is prepared to act as liquidator; or
  • failed to comply with a direction by the Commissioner; or
  • failed to remedy a contravention of the Act within 60 days' notice having been given by the Commissioner.

An association has 60 days to respond if the Commissioner issues a show cause notice.

If the association does not show cause to the satisfaction of the Commissioner within the allowed period, the Commissioner may by order published in the gazette cancel the incorporation of the association. The Commissioner must give the association 28 days written notice of the proposed order, and the association can seek a review of the Commissioner's proposal in the State Administrative Tribunal within those 28 days.

Upon the Commissioner making such an order all property held by the association vests in the State. The Commissioner has the power to act in the name of the State by realising the property, paying out the debts of the association and otherwise winding it up.

If the Commissioner is satisfied that the incorporation should not have been cancelled then the Commissioner can reinstate the incorporation.

Decisions of the Commissioner reviewable in the State Administrative Tribunal

Section 169 of the Act sets out 17 separate types of decisions of the Commissioner that are subject to review by the State Administrative Tribunal. Some examples are:

  • refusal of application to incorporate an association;
  • refusal to approve the name of an association;
  • refusal to approve a change to the rules;
  • directing an association to convene a general meeting;
  • refusal of an application by an association to cancel its incorporation.

An affected person may apply to the State Administrative Tribunal for a review of a reviewable decision.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Philip Mavor
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