27 November 2013

1. Fines, Debts & the SDRO 27 November 2013

2. The information provided in this session is for information purposes only. • It must not be relied on as legal advice. • You should seek legal advice about your own particular circumstances.

3. Today’s Topics • SDRO Fines • Disputing Fines • Options if your clients can’t pay • Private Debt • Letters of Demand • Statements of Claim

4. SDRO Fines

5. The SDRO Fines Process Always encourage your clients to deal with fines straight away. Even if they cannot afford to pay, it is important that they don’t simply ignore the fine. The SDRO will take serious enforcement action to recover unpaid fines. C B A

6. A) Responding to a Penalty Notice • Pay the finein full • Apply to pay by instalments • Request a review • Apply for a WDO • Court elect • 21 days to respond

7. 1. Requesting a review • Possible Outcomes of a Review: • PENALTY STANDS • Either pay the fine or dispute the matter in court • CAUTION • The penalty notice was issued correctly, but in the circumstances, a fine is inappropriate. The caution will still be taken account for any future offences. • CANCELLATION • No fine is issued, no demerit points are taken away. • Requests for review can be made: • Online at www.sdro.nsw.gov.au; • In writing to SDRO, PO BOX 786 Strawberry Hills NSW 2012; or • By phone 1300 138 118

8. 1. Requesting A Review Tess was pulled over at an RBT and fined for failing to display her P plates. Tess’ friends had driven their car to a party. Her friends had been drinking and wanted to drive home. Tess didn’t want them to drive drunk. She drove them home in their car. They did not have any P plates. Tess requested a review. She received a caution but did not have to pay the fine. James received a penalty notice in the mail for a speeding fine. The fine was issued in June while James was overseas. He had lent his car to a friend while he was travelling. James sent a statutory declaration to the SDRO saying that he was not the driver. His fine was cancelled.

9. 2. Work and Development Orders (WDOS) • Work and Development Orders are available to people who: • Have a mental illness, intellectual disability or cognitive impairment • Are homeless • Are experiencing acute economic hardship • Have serious drug or alcohol addictions • These orders allow people to ‘work off’ their fine debt, by either engaging in unpaid work OR undergoing treatment, training or mentoring that will benefit them.

10. 2. WDOs Applications for a WDO can be made by filling out a standard form on the SDRO website. If the application is approved, the client can start working off their fine debt by completing the activities in the table.

11. 2. WDOs: Approved Organisations A WDO can only be made if an application is supported by an “approved organisation” or a qualified health practitioner. Does anyone here work for an Approved Organisation? What kind of work do WDO clients do for your organisation? What services does your organisation provide to WDO clients?

12. 3. Court Election • Fines can also be disputed in court. • An application must be made: • Before the due date on the penalty reminder notice; OR • Within 28 days of having a request for review denied; AND • Before the fine has been paid. • This application can be made on the SDRO website or by writing to: • www.sdro.nsw.gov.au/contact; OR • State Debt Recovery Office, PO Box 786, Strawberry Hills NSW 2012

13. 3. Court Election: The Process

14. 3. Court: The Outcomes • A. Guilty • They will be required to pay the fine, demerit points will apply • Additional costs may also be imposed • B. Non-Conviction • The court finds that the person is guilty of the offence, but in the circumstances, it is inappropriate to proceed to a conviction. • The fine will be waived, but costs might still be imposed. • C. Not guilty • The fine is waived, no demerit points will apply. No costs are imposed.

15. B) Enforcement Orders If a fine is not paid by the due date, the SDRO will make an Enforcement Order and impose an additional fee of $65 for adults or $25 for people under the age of 18. Enforcement orders give people 28 days to respond before further action is taken to recover the debt.

16. Responding to Enforcement orders Postpone Enforcement Apply for a WDO Pay the Fine Dispute the Fine Pay in full online, by phone, BPAY or at a Post Office. OR Apply to pay by instalments. Apply for an annulment order and have the matter decided in court. OR Apply to have the fine written off. WDO applications can be made at any stage of the fines process. See earlier slides re: WDOs. Where a person is in serious financial difficulty, the SDRO might postpone enforcement action for up to twelve months.

17. Disputing the Fine: Annulment • Clients who receive an enforcement order can make an ‘annulment application’. • This allows them to dispute the fine in court. • In this application, the client has to: • Explain why they didn’t respond to the penalty notice • Explain why they are not guilty • Provide documentation to support their claims • This application costs $50 unless the client claims financial hardship. • If the application is successful, the client will be given a court date.

18. Disputing the Fine: Annulment • The SDRO must annul the enforcement order if: • The client could not address their fine due to accident, illness or misadventure. • There is doubt about the client’s guilt or liability for the fines • There is other just cause (such as homelessness, severe financial hardship or being under 18)

19. Disputing the Fine: Write offs • The SDRO has the power to write off all or part of an unpaid fine debt if they believe: • That the applicant is unlikely to ever be able to pay the fine, or comply with a community service order because of a serious illness or disability; and • That continued enforcement action would be unfair or unjust

20. C) Enforcement Action by the Sdro

21. 1) RMS Sanctions • The SDRO can refer unpaid fines to Roads and Maritime Services (formerly the RTA). The RTA can then: • Suspend drivers’ licences without notice or prevent people from obtaining a new licence • Cancel the licence and cancel vehicle registration if a fine is not paid for 6 months • Impose “customer business restrictions”. This could include refusing to issue new number plates, or renew registration.

22. 2) Civil Enforcement If the fine remains unpaid even after RMS sanctions are imposed, the SDRO can apply to a local court to make any of the following enforcement orders. Summons to appear in court Charge on Land Property Seizure Order Garnishee Order This allows the sheriff to seize and sell certain items of personal property to recover the debt. A certain amount of the clients income will go towards repaying the fine, each pay period. The enforced fine will be registered as a charge on land owned by the client. The client must appear in court to be questioned about their assets & income

23. 3) Community Service Orders This is a court order that the client perform a certain amount of community service. Community service orders are not commonly used. They will be imposed if RMS sanctions and civil enforcement have not been successful. The Probation and Parole Officers from NSW Corrective Services must assess the client’s suitability for community service.

24. 4) Imprisonment If a client fails to comply with a community service order, the SDRO could issue a warrant for the imprisonment of that client. This is very rare in practice.

25. Assisting your clients with fine debt • Ask them if they have a fines debt • Explain that even if they don’t have the money to pay, there are other options available • Make effective referrals to legal and financial services • Where appropriate, assist them to make applications to the SDRO • Call the SDRO Advocacy Hotline on 1300 135 627

26. Private Debts

27. Overview • This section will focus on private debt. This includes: • Rental Payments • Phone Bills • Mortgage Repayments • Credit Card Bills • Personal Loans • Private Car Park Fines • Money owed to family and friends • Medical Fees • Money owed for goods and services

28. What is a Letter of Demand? This is a letter from the creditor which says that court proceedings will be started if a debt is not paid by a certain date. STEP ONE: Check that the amount is correct. STEP TWO: If it is the amount claimed is incorrect, or unclear, write back to the creditor and ask for a detailed statement of the money owed.

29. Responding to a Letter of demand Pay in Full Alternative Dispute Resolution Refuse to Pay • If informal negotiations do not work, it can still be possible to settle the dispute out of Court. • Community Justice Centres • Consumer, Trader & Tenancy Tribunal • Financial Ombudsman Service • Credit Ombudsman Service • The creditor may start legal proceedings to recover the debt. Make an Offer • You can respond to the letter and ask: • For an extension of time to pay • To pay off the debt by instalments • That the debt be reduced due to financial hardship • That the debt be written off

30. What is a Statement of Claim? This is a document issued by the Local Court. It means the creditor has started legal proceedings to recover money from you.If you receive a Statement of Claim, you have 28 days from the date you received it to make a response to the Local Court.

31. Responding to a Statement of Claim Ignore the Claim Part Payment/ Instalments File a Defence File a Cross-Claim Voluntary Bankruptcy The Court will make a ‘Default Judgment’. The judgment creditor can start enforcement action. Negotiate an agreement out of court.You might still have to pay the creditors legal costs. If you say you don’t owe the debt you can file a defence. ALWAYS SEEK LEGAL ADVICE before filing. Seek advice from a lawyer or a financial counsellor before filing for bankruptcy. If you think that the creditor also owes you a debt you can file a cross-claim.

32. CIVIL enforcement We spoke earlier about the SDRO taking enforcement action in court. Private companies and individuals can also go to court seeking orders to have the debt paid. They have 12 years from the date of the judgmentto take enforcement action. Summons to appear in court Instalment Orders Order to seize & sell property Garnishee Order Bankruptcy Proceedings Charge on Land

33. Bankruptcy Bankruptcy is a process where people who cannot pay their debts give up their assets and control of their finances, either by agreement or court order, in exchange for protection from legal action by their creditors. Bankruptcy is a complex technical area of law. These means that the proceedings tend to be very slow and very costly.

34. Service Directory

37. Acknowledgements • The information in these slides has been drawn from: • A CLE presentation prepared by Marrickville CLC • Federal Court of Australia Factsheets on Bankruptcy • NSW College of Law Practice Papers on Civil Enforcement Options • Legal Aid NSW factsheet “Are you being squeezed for a debt” • Factsheets from the SDRO Website • SDRO Presentation on “The Fines Process” by Mark Lester • Attorney-General’s Work and Development Order Guidelines 2012 • SDRO Review Policy