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This is a Bill, not an Act. For current law, see the Acts databases.
TASMANIA
__________
PREPAID FUNERALS BILL 2004
__________
CONTENTS
PART 1 PRELIMINARY
1. Short title
2. Commencement
3. Interpretation
4. Application of Act
PART 2 DISCLOSURE OF PRE-CONTRACTUAL
INFORMATION
5. Disclosure of information before prepaid funeral
agreement
PART 3 PREPAID FUNERAL AGREEMENTS
Division 1 Prepaid funeral agreements
6. Pre-existing prepaid funeral agreements
7. Prepaid funeral agreements
8. Termination of prepaid funeral agreement
Division 2 Funeral trusts
9. Duty to deposit payments into funeral trust
10. Requirements for funeral trusts
11. Appointment of custodian
12. Register of funeral trusts
[Bill 5]-IV
13. Duty of funeral trust to refund payments
14. Investments of funeral trust
15. Payments from funeral trust
Division 3 Duties of funeral businesses and custodians
16. Insolvency of funeral business
17. Duty to maintain register
18. Value of funeral trust
19. Annual returns
20. Copy of records
21. Death of recipient before completion of payments under
agreement
22. Director may require audit
PART 4 MISCELLANEOUS AND SUPPLEMENTAL
23. Transfer of rights and obligations
24. Disputes about payment of funds
25. Restriction on withdrawal of funds
26. Liability for offences against Act
27. Investigations
28. Regulations
29. Administration of Act
30. Consequential amendments
SCHEDULE 1 CONSEQUENTIAL AMENDMENTS
2
PREPAID FUNERALS BILL 2004
(Brought in by the Minister for Justice and Industrial
Relations, the Honourable Judith Louise Jackson)
A BILL FOR
An Act to regulate the provision of prepaid funeral
services and to make consequential amendments to
the Consumer Affairs Act 1988
Be it enacted by His Excellency the Governor of Tasmania,
by and with the advice and consent of the Legislative
Council and House of Assembly, in Parliament assembled,
as follows:
PART 1 PRELIMINARY
Short title
1. This Act may be cited as the Prepaid Funerals Act
2004.
Commencement
2. This Act commences on a day to be proclaimed.
Interpretation
3. In this Act, unless the contrary intention appears
"auditor" means an auditor who is
[Bill 5] 3
s. 3 No. Prepaid Funerals 2004
(a) a registered company auditor within the
meaning of the Corporations Act; and
(b) a member of
(i) the Institute of Chartered
Accountants; or
(ii) the Australian Society of Certified
Practising Accountants; or
(iii) the National Institute of
Accountants;
"contributor" means a person who enters into a
prepaid funeral agreement either for his or her
own benefit or the benefit of another person;
"custodian" means a person appointed to manage
the business of a funeral trust;
"Director" means the Director of Consumer Affairs
and Fair Trading;
"funeral business" means a business in the course
of which funeral services are supplied or
arranged;
"funeral services" means the provision of
(a) all or part of any funeral, burial or
cremation service; or
(b) all or part of any services connected with
funeral, burial or cremation services
and includes
(c) the attendance of a person to assist with
arrangements for a funeral, burial or
cremation; and
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2004 Prepaid Funerals No. s. 3
(d) the attendance of a person to assist with
the preparation of associated documents
and notices; and
(e) the transportation of the body of a
deceased person; and
(f) the use of mortuary facilities or services;
and
(g) the supply of any goods including a
coffin or casket; and
(h) the arrangements made for burial or
cremation of a deceased person; and
(i) the provision of a mobile graveside
chapel; and
(j) the provision of a lowering device for a
coffin or casket; and
(k) the preparation of the ashes of a
deceased person awaiting inurnment
and memorial arrangements;
"funeral trust" means a funeral trust established
under section 10;
"GST" has the same meaning as in the A New Tax
System (Goods and Services Tax) Act 1999 of
the Commonwealth;
"person" includes a partnership;
"prepaid funeral agreement" means an
agreement to supply funeral services, for
payment or other valuable consideration,
which is made before the death of the
recipient;
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"recipient" means a person for whom funeral
services are intended to be provided;
"regulations" means regulations made and in force
under this Act;
"relationship status" means the status of being
married or in a significant relationship, within
the meaning of the Relationships Act 2003, or
in a caring relationship which is the subject of
a deed of relationship registered under Part 2
of that Act;
"transferee" means a person carrying on a funeral
business to which the rights and obligations
arising from another funeral business are
transferred.
Application of Act
4. This Act applies to
(a) all prepaid funeral agreements made after the
commencement of this Act; and
(b) certain prepaid funeral agreements made
before that commencement as mentioned in
section 6.
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2004 Prepaid Funerals No. s. 5
PART 2 DISCLOSURE OF PRE-CONTRACTUAL
INFORMATION
Disclosure of information before prepaid funeral
agreement
5. (1) Subject to subsection (3), a person carrying on a
funeral business must not make a prepaid funeral
agreement unless he or she first provides to the
contributor and the recipient the following information:
(a) the name, including the business name if any,
and the address where the funeral business is
carried on;
(b) the name of the contributor and the usual
residential address of the contributor;
(c) the name of the recipient and the usual
residential address of the recipient;
(d) the name of the prepaid funeral trust to which
payments are to be made;
(e) full details of each funeral service to be
supplied, including details of all goods,
services and facilities to be supplied in
connection with that funeral service and the
cost of each of those goods, services and
facilities;
(f) the due date for any payment or other
valuable consideration in respect of the
funeral services by the contributor and how
the payment or consideration is to be made or
given;
(g) where payments under the agreement are to
be made by instalment, the amount of each
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instalment and the date on which each
instalment is due;
(h) any terms or conditions applying to the
conduct of the funeral or to the provision of
other funeral services;
(i) any fees, brokerage or commission payable to
the funeral business or to any other person;
(j) the amount of any GST or other amount
payable by law by virtue of the agreement;
(k) any other information prescribed by the
regulations.
(2) A person must not provide any information
required under subsection (1) that is incorrect in a
material particular.
Penalty: Fine not exceeding 50 penalty units.
(3) A person is not required to provide any
information mentioned in subsection (1) to a recipient if
(a) an enduring power of attorney granted by the
recipient to the contributor is in force; or
(b) the contributor is a person responsible for the
recipient within the meaning of section 4 of
the Guardianship and Administration Act
1995.
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2004 Prepaid Funerals No. s. 6
PART 3 PREPAID FUNERAL AGREEMENTS
Division 1 Prepaid funeral agreements
Pre-existing prepaid funeral agreements
6. (1) Within 6 months after the commencement of this
Act, a person carrying on a funeral business must notify
the Director in writing of all prepaid funeral agreements
that have been made in the course of that business before
the commencement of this Act, unless funeral services
have been supplied under the agreement.
Penalty: Fine not exceeding 10 penalty units.
(2) A notification under subsection (1) is to be in a
form approved by the Director.
Prepaid funeral agreements
7. (1) A person must not make a prepaid funeral
agreement unless it is made in accordance with this Act.
Penalty: Fine not exceeding 50 penalty units.
(2) A prepaid funeral agreement is to be in writing,
signed by each party to the agreement, and is to contain
any information required by section 5(1), which
information may form part of the agreement or may be
given in a separate document at the time when the
agreement is made.
(3) If any of the required information is set out in an
attachment to the agreement, reference is to be made in
the agreement to the attachment.
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(4) Within 14 days after making the agreement, the
person carrying on the funeral business must give a copy
of the signed agreement to the contributor.
Penalty: Fine not exceeding 10 penalty units.
(5) The agreement is to be printed in a font size of at
least 10 points.
(6) Any provision in a prepaid funeral agreement
which permits the price for any funeral services to be
increased is void.
(7) Subsection (6) does not prevent the provision of
additional funeral services for which additional charges
are payable.
Termination of prepaid funeral agreement
8. (1) A contributor may, by notice in writing to a person
carrying on a funeral business, terminate a prepaid
funeral agreement on any of the following grounds:
(a) that the recipient has ceased to be ordinarily
resident in Tasmania;
(b) that the relationship status of the recipient
has changed;
(c) that in the opinion of the Director it is
unreasonable in all the circumstances that the
agreement should continue in force;
(d) that the continued payment of instalments
would cause serious hardship for the
contributor;
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2004 Prepaid Funerals No. s. 9
(e) that the funeral business has ceased to carry
on business and is unable to provide the
funeral services;
(f) that funeral services have already been
supplied in respect of the recipient.
(2) A person carrying on a funeral business may, by
notice in writing to the contributor, terminate a prepaid
funeral agreement on either of the following grounds:
(a) that the funeral business has ceased to carry
on business;
(b) that the funeral business is unable to provide
the funeral services for reasons that were not
reasonably foreseeable at the time the
agreement was made.
(3) On application by a person carrying on a funeral
business, the Director may terminate a prepaid funeral
agreement if he or she is satisfied that in all the
circumstances it is unreasonable for the agreement to be
performed.
Division 2 Funeral trusts
Duty to deposit payments into funeral trust
9. Within 14 days after receiving any money under a
prepaid funeral agreement, a person carrying on the
funeral business must deposit that money in a funeral
trust approved by the Director.
Penalty: Fine not exceeding 100 penalty units.
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Requirements for funeral trusts
10. (1) A funeral trust may be established for the
purposes of 2 or more funeral businesses.
(2) The terms of the funeral trust are to be approved
by the Director who may impose conditions on the
approval if he or she considers it necessary or expedient to
do so for the purposes of this Act.
(3) The Director may revoke an approval if satisfied
that
(a) an offence against this Act has, or may have,
been committed or is likely to be committed; or
(b) an investigation is being, or is to be, conducted
into the funeral trust and the Director
considers it appropriate to revoke the
approval; or
(c) a condition of the approval has not been
complied with.
(4) On the revocation of an approval, the Director
must notify the custodian of the funeral trust and any
person who has deposited money with the trust of the
revocation and the reasons for it.
Appointment of custodian
11. (1) A funeral trust is of no effect unless it provides for
the appointment of a custodian to act as manager of the
trust's business.
(2) The custodian must not have any interest in any
funeral business that is a beneficiary of the funeral trust
and the custodian must not otherwise be a beneficiary of
the trust.
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2004 Prepaid Funerals No. s. 12
(3) The responsibilities of the custodian are to
ensure
(a) that payments by the funeral trust are made
only in accordance with this Act and a prepaid
funeral agreement; and
(b) that funds held by the funeral trust are
invested in accordance with the Trustee Act
1898; and
(c) that the funeral trust is administered in
accordance with this or any other Act.
(4) The custodian must ensure that all investments
made or held by the funeral trust are made or held in the
name of the custodian on behalf of the funeral trust unless
otherwise authorised by the Director.
Penalty: Fine not exceeding 10 penalty units.
Register of funeral trusts
12. (1) The Director is to maintain a register of all funeral
trusts approved under this Act.
(2) The register is to contain such particulars of the
funeral trust as the Director thinks fit and is to be
available for public inspection at the office of the Director
at all times during normal business hours without charge.
(3) If
(a) approval of a funeral trust is revoked under
section 10(3); or
(b) any person concerned in the management of a
funeral trust is convicted of an offence against
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s. 13 No. Prepaid Funerals 2004
this Act or any other offence involving
dishonesty
the Director may remove particulars of the funeral trust
from the register.
Duty of funeral trust to refund payments
13. (1) Where a prepaid funeral agreement is terminated
under this Act, a person carrying on the funeral business
must immediately notify the custodian of the relevant
funeral trust of the termination.
(2) On receiving notification, the custodian must
make any payments to a contributor as are required by
this Act within 14 days or any longer period allowed by the
Director, less
(a) any reasonable costs as prescribed by the
regulations; and
(b) any amounts properly payable to the funeral
business.
Penalty: Fine not exceeding 5 penalty units.
Investments of funeral trust
14. (1) A custodian must invest in accordance with the
Trustee Act 1898 any money paid, or any other valuable
consideration received, in respect of the funeral trust.
Penalty: Fine not exceeding 50 penalty units.
(2) The value of any investment made by the funeral
trust, including the amount invested and any earnings,
dividends or interest on that investment, is the property of
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2004 Prepaid Funerals No. s. 15
the funeral trust and in any accounting of the value of the
funeral trust is to be apportioned at least once each year.
(3) A person who is not the custodian or acting on
the authority of the custodian may not authorise
investments, payments, withdrawals or transfer of any
assets or investments of the funeral trust.
Penalty: Fine not exceeding 50 penalty units.
Payments from funeral trust
15. (1) The custodian of a funeral trust must not pay any
money out of the funeral trust unless the payment is
made
(a) to a person carrying on a funeral business for
provision of funeral services under a prepaid
funeral agreement following the death of the
recipient; or
(b) to the contributor on the termination of a
prepaid funeral agreement in accordance with
this Act; or
(c) for reasonable expenses incurred by the
custodian in the administration of the funeral
trust and investments of the funeral trust; or
(d) for charges by the custodian in accordance
with a scale approved by the Director for the
administration of the funeral trust; or
(e) in accordance with section 23(2).
Penalty: Fine not exceeding 100 penalty units.
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(2) The custodian of a funeral trust must not make a
payment from the funds of the funeral trust otherwise
than in accordance with this Act.
Penalty: Fine not exceeding 100 penalty units.
(3) Where an offence has been committed in respect
of the payment of money from a funeral trust, a
magistrate may, on the application of a contributor,
custodian or other interested person, direct such
reimbursement of the funeral trust as would be required
to restore
(a) any payments improperly made from the
trust; and
(b) any other loss to the trust that arose from that
improper payment.
(4) Where a payment out of a funeral trust is made
following the death of a recipient, the custodian must
make the payment to the person carrying on the relevant
funeral business but the amount paid is not to exceed an
amount required for
(a) the funeral business to provide the funeral
services required under the prepaid funeral
agreement; and
(b) any additional amount of GST payable for
goods or services provided under the
agreement.
(5) Where a payment out of a funeral trust is
required following termination of a prepaid funeral
agreement in accordance with this Act, the payment is to
be made to the contributor and is to include an amount
representing a reasonable proportion of the value of the
funeral trust, having regard to the time that the funds
have been deposited in the funeral trust.
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2004 Prepaid Funerals No. s. 16
(6) Where a payment is made to a transferee in
accordance with this Act, the payment is to be the same
amount as would have been payable if the contributor had
terminated the agreement.
Division 3 Duties of funeral businesses and
custodians
Insolvency of funeral business
16. If
(a) a person carrying on a funeral business
becomes insolvent or ceases to carry on that
business; and
(b) the obligations under prepaid funeral
agreements made by that funeral business are
not transferred to another funeral business
the custodian of the relevant funeral trust must transfer
all the property and investments of the funeral trust that
relate to the first-mentioned funeral business to the
contributors in accordance with this Act.
Penalty: Fine not exceeding 100 penalty units.
Duty to maintain register
17. (1) The custodian of a funeral trust must maintain a
register of prepaid funeral agreements under which
payments are made to the funeral trust which records
(a) the name and address of each contributor; and
(b) the name and address of each recipient; and
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(c) the date on which each payment was received
by a person carrying on a funeral business
from a contributor and the amount of each
payment; and
(d) the name of another funeral trust to which
any money or valuable consideration received
under a prepaid funeral agreement by a
person carrying on a funeral business is paid
or transferred; and
(e) the date when the agreement is terminated or
transferred or the date when the funeral
services are supplied in respect of the
recipient.
(2) The custodian of any funeral trust must
maintain proper accounts for the funeral trust showing
(a) the name of the trust account and the name of
the institution at which the trust account is
held; and
(b) all investments made on behalf of the funeral
trust and income, dividends or other earnings
received in respect of those investments; and
(c) all money and any other consideration
received by the custodian in respect of each
contributor; and
(d) expenses incurred by the custodian in the
administration and investments of the funeral
trust; and
(e) payments from the funeral trust that are
made on the performance of a prepaid funeral
agreement or on the termination or transfer of
the agreement under this Act; and
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2004 Prepaid Funerals No. s. 18
(f) any other accounting records normally
required to be kept by a trustee.
Penalty: Fine not exceeding 50 penalty units.
Value of funeral trust
18. (1) In this section
"Actuary" means a person who is a Fellow of the
Institute of Actuaries (Australia) or another
suitable person who is, in either case,
approved by the Director.
(2) On request by the Director, the custodian of a
funeral trust must cause the value of the funeral trust to
be determined by an Actuary.
Penalty: Fine not exceeding 50 penalty units.
(3) The Actuary must determine the total value of
the assets and the future and contingent liabilities of the
funeral trust and provide a report to the custodian and the
Director accordingly.
Annual returns
19. (1) A person carrying on a funeral business must
before 31 December in each year lodge with the Director a
return for the period ending on 30 June in that year
stating
(a) the total number of prepaid funeral
agreements that he or she has made where the
funeral services have not yet been supplied;
and
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s. 19 No. Prepaid Funerals 2004
(b) the name and location of any funeral trust into
which payments under those agreements have
been made; and
(c) the total amount of all contributions by the
funeral business to the funeral trust.
(2) The custodian of a funeral trust must before
31 December in each year lodge with the Director an
annual return for the previous financial year including
(a) a statement of the value of the funeral trust
and an estimate of the future and contingent
liabilities of the funeral trust or, where
requested by the Director under section 18(2),
the value of the funeral trust and an estimate
of the future and contingent liabilities of the
funeral trust as determined under
section 18(3); and
(b) a report by an auditor in respect of the funeral
trust stating whether the custodian has, in the
opinion of the auditor, kept proper accounting
records in respect of the funeral trust and has
maintained a register in accordance with
section 17; and
(c) such statements as in the opinion of the
auditor are adequate to explain the financial
transactions of the funeral trust both during
and at the end of that financial year and the
financial position of the funeral trust at the
end of that financial year.
Penalty: Fine not exceeding 100 penalty units.
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2004 Prepaid Funerals No. s. 20
Copy of records
20. A person carrying on a funeral business must keep
copies of
(a) all prepaid funeral agreements; and
(b) all records relating to payments by
contributors under the agreements
for a period of not less than 5 years after the agreement is
performed or terminated.
Death of recipient before completion of payments
under agreement
21. (1) Where a prepaid funeral agreement provides for
payment by instalments and the recipient dies before the
payment of the final instalment, the person carrying on
the funeral business must supply funeral services as if the
final instalment had been made.
Penalty: Fine not exceeding 50 penalty units.
(2) Subsection (1) does not affect the liability of any
personal representative of the recipient for any amount
due under the agreement.
Director may require audit
22. (1) If the Director believes it appropriate to do so, the
Director may, by notice in writing given to a person
carrying on a funeral business or a custodian, require the
person or custodian to conduct an audit of a funeral trust
within 28 days after the notice is given and at the expense
of the funeral trust.
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(2) An audit required by the Director under
subsection (1) is to provide such information as the
Director considers appropriate to satisfy the purposes of
this Act.
(3) A person carrying on a funeral business or a
custodian must comply with the requirements of this
section.
Penalty: Fine not exceeding 100 penalty units.
22
2004 Prepaid Funerals No. s. 23
PART 4 MISCELLANEOUS AND SUPPLEMENTAL
Transfer of rights and obligations
23. (1) Where payments under a prepaid funeral
agreement are held by a funeral trust, a person carrying
on the relevant funeral business may assign his or her
rights and obligations under the agreement to another
funeral business.
(2) On an assignment under subsection (1), the
custodian of the relevant funeral trust must
(a) continue to act as custodian of that funeral
trust in respect of the relevant prepaid funeral
agreement; or
(b) pay all money and transfer all investments
held in respect of the agreement to the
custodian of another funeral trust nominated
by the person carrying on the first mentioned
funeral business.
Disputes about payment of funds
24. In the event of any dispute arising on the termination
of a prepaid funeral agreement or otherwise under the
agreement or arising from any payments out of a funeral
trust or the provision of funeral services, a magistrate
may, on the application of a contributor, recipient or
personal representative of a recipient, make
(a) an order for the payment of money from a
funeral trust; and
(b) any consequential orders that the magistrate
considers appropriate.
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s. 25 No. Prepaid Funerals 2004
Restriction on withdrawal of funds
25. (1) If
(a) the Director has reason to believe that a
funeral trust is not being managed in a
manner consistent with this Act; or
(b) a custodian or a person carrying on a funeral
business has contravened this Act; or
(c) a requirement for a return under this Act has
not been met and it is desirable to prohibit
payment from a funeral trust during the
course of an investigation
the Director may make an order preventing any further
withdrawal of money from any account or investment held
in respect of the funeral trust or the funeral business for
such time as he or she thinks fit.
(2) A person carrying on a funeral business or a
custodian must comply with an order made under this
section.
Penalty: Fine not exceeding 100 penalty units.
Liability for offences against Act
26. (1) Where there is a contravention of a provision of
this Act by a funeral business, the person carrying on the
funeral business may be convicted of an offence against
that provision unless he or she satisfies the court that the
act or omission constituting the offence took place without
his or her knowledge or consent.
(2) Where a body corporate is charged with an
offence against this Act, a director of the body corporate or
any other person who is concerned with, or takes part in,
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2004 Prepaid Funerals No. s. 27
the management of the body corporate may be charged
with the same offence and, if the body corporate is
convicted of the offence, any person charged with the same
offence under this section may be convicted of that offence
unless he or she satisfies the court that the act or omission
constituting the offence took place without his or her
knowledge or consent.
Investigations
27. An authorized officer, within the meaning of the Fair
Trading Act 1990, has the same powers for entry to
premises and obtaining documents and other information
as are conferred by sections 30 and 31 of that Act, and the
offences and penalties provided by section 32 of that Act
apply.
Regulations
28. (1) The Governor may make regulations for the
purposes of this Act.
(2) Without limiting the generality of subsection (1),
the regulations may
(a) provide for the obligations of the custodian of a
funeral trust to make a payment as required
under section 13; and
(b) exempt a deposit scheme or class of deposit
schemes which are subject to alternative
prudential regulation from the application of
this Act or any provision of this Act; and
(c) exempt a class of prepaid funeral agreements
from the application of any provision of this
Act where payments under the agreements are
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to be made into a deposit scheme that is
exempted under paragraph (b); and
(d) exempt a person carrying on a funeral
business from the application of any provision
of this Act for a specified period.
Administration of Act
29. Until provision is made in relation to this Act by order
under section 4 of the Administrative Arrangements Act
1990
(a) the administration of this Act is assigned to
the Minister for Justice and Industrial
Relations; and
(b) the department responsible to that Minister in
relation to the administration of this Act is the
Department of Justice.
Consequential amendments
30. The legislation specified in Schedule 1 is amended as
specified in that Schedule.
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2004 Prepaid Funerals No. sch. 1
SCHEDULE 1 CONSEQUENTIAL AMENDMENTS
Section 30
Consumer Affairs Act 1988
1. Section 3A is amended by inserting ", the Prepaid
Funerals Act 2004" after "Consumer Credit (Tasmania)
Code".
2. Section 16 is amended as follows:
(a) by inserting in subsection (3) ", the Prepaid
Funerals Act 2004" after "Consumer Credit
(Tasmania) Code";
(b) by inserting in subsection (4) ", the Prepaid
Funerals Act 2004" after "Consumer Credit
(Tasmania) Code".
Government Printer, Tasmania 27