Substantive Law Archives - Hearsay: The Legal Podcast

NSW is set to become the first state in Australia to impose automatic lifetime bans on criminals convicted of serious animal cruelty from ever owning, working with, or breeding animals under proposed section 31AA of the Prevention of Cruelty to Animals Amendment Bill 2021 (NSW). As of 10 June 2021, the Bill is awaiting royal assent.

The new law comes after two years of campaigning by Animal Justice Party MP Emma Hurst. When the legislation commences, criminals convicted of serious animal cruelty under section 530 of the Crimes Act 1900 (NSW) will automatically be subject to a lifetime ban on owning, working with, or breeding animals. Hurst has stated before that her campaign to increase penalties for animal cruelty offences is fueled by her belief that “there have been far too many cases where the punishments simply do not match the crimes.” Adam Marshall, NSW Agriculture Minister, similarly recognised that before the passing of the Bill, NSW’s animal cruelty penalties “lagged behind where they need to be” and that the Bill more accurately reflects community expectations.

The new legislation is welcomed by the animal law community who have long been calling for the criminal law to better reflect the community’s attitudes towards serious animal cruelty offences. For example, the 2019 conviction and sentencing of Daniel Brighton made news after the man received the longest sentence for animal abuse crimes in NSW’s history – a term of 40 months – after torturing and killing a dog that had entered his property. At the time of the offence, Brighton was an owner of a mobile petting zoo and had previously taught Animal Studies subjects at TAFE. In 2020, however, the Supreme Court quashed Brighton’s conviction, ruling that while his acts were “particularly abhorrent and, ultimately, cruel” they were not illegal under the Crimes Act because Brighton’s actions fell within the defence of exterminating a pest animal. Brighton’s case highlights the need for law reform in this area so that violent acts of cruelty against other living beings are subject to appropriate sanctions that reflect community values.

The Bill also includes significant increases to maximum penalties for animal cruelty offences, with an eightfold increase to $44,000 and/or a term of imprisonment of one year for an individual convicted of animal cruelty to animals under section 5 of the Prevention of Cruelty to Animals Act 1979 (NSW) (POCTAA), and a maximum penalty of $220,00 for corporations. For aggravated animal cruelty offences, the increase is five-fold to a $110,000 fine and/or a term of imprisonment of two years for an individual convicted of aggravated animal cruelty. For corporations convicted under section 6 for aggravated animal cruelty, the new maximum fine is $550,000. Offences under section 8 of POCTAA relating to animals being provided with food, drinks or shelter have tripled to $16,500 and/or 6 months imprisonment for an individual, and $82,500 for corporations.

To learn more about animal law generally in Australia, check out Episode 35 of Hearsay with Tess Vickery and Rishika Pai.

By now, nearly every legal professional, even those in the most traditional of firms, will have spent an extended period of time working from home as a consequence of the COVID-19 pandemic, even if only temporarily. Whether willingly or unwillingly, almost every Australian law firm has been a participant in the world’s largest impromptu working-from-home experiment.

Prior to the pandemic, employers feared that working from home often ended up being ‘shirking from home’ – a chance to slack off in the absence of supervision – and flexible working arrangements were primarily seen as an issue relevant only to new parents and primary carers. But the working-from-home experiment has now produced data – and many employers have found that self-motivated, highly-skilled professionals are in fact more productive when they have the option to work from the comfort of their own home. WFH advocates will know this isn’t really news – a study by academics at the Harvard and Northeastern Business Schools of a telework programme at the US Patent and Trademark Office, all the way back in 2012, found that allowing employees to work from home, and even from different cities, improved productivity and produced cost savings for the organisation, and a 2014 study of a Chinese travel company produced similar results – but the benefits of flexible work are now more widely known.

But the benefits of WFH can be overstated. It is not uncommon to hear professionals reflecting that during quarantine, they missed real-life social interactions and “water cooler chats” – the kind of organic interactions that build a sense of belonging in a team, and help to resolve interpersonal issues and conflicts at work. Slack and other social applications can emulate the effect of these interactions but there’s no replacement for the real thing.

The Law Society of NSW has published a variety of guides for practitioners seeking to implement more flexible work arrangements, referring to workplace flexibility as ‘the new normal’. Practitioners should also refer to the NSW FairWork Ombudsman’s page here, which includes examples of flexible working arrangements as changes to:

hours of work (e.g. changes to start and finish times);
patterns work (e.g. split shifts or job sharing); and
locations of work (e.g. working from home).

In Episode 8 of Hearsay, “Working 9 to 5, redefined” with Nicola Martin, we discuss relevant aspects of employment law in relation to flexible work arrangements such as working from home in the COVID-19 pandemic.

Until recently, decisions like Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 (2014) 254 CLR 185 and Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515, in which the High Court held that builders and engineers do not owe a duty of care to owners’ corporations or to purchasers of commercial property, resulted in strata schemes and apartment owners bearing the cost of fixing major building and design issues.

However, combustible cladding scandals at home and abroad (notably the Grenfell Towers disaster in London) have put pressure on governments to address the allocation of responsibility for these sorts of design failures.

That pressure has resulted in the Design and Buildings Practitioners Act 2020 and Regulation 2021 (NSW), which have been described by NSW Minister for Innovation and Better Regulation, Matthew Kean, as the most significant changes in building-related law in NSW’s history.

Taking effect on 11 June 2020, the new Act and Regulations impose a duty of care on builders, developers and engineers to avoid economic loss caused by defects in the design and construction of buildings. The Act also introduces a comprehensive registration regime for building designers and engineers, and now requires design and building practitioners to provide declarations that the building work complies with the Building Code of Australia before an occupation certificate can be issued. The Building Commissioner oversees the implementation of the Act and Regulations.

Critics of the new legislation have suggested that increased regulation will result in higher insurance premiums for builders, that ultimately will be passed onto property purchasers, worsening the housing affordability crisis in NSW. The NSW Government argues, however, that the new legislation reflects community attitudes that vulnerable apartment purchasers should be entitled to rely on the quality of the work done by designers and builders, and should be protected from the economic consequences of design and construction defects.

To learn more about strata schemes generally, listen to Episode 3 of Hearsay with Samantha Saw, partner at Speirs Ryan.

On Sunday 25th April 2021, health and aged care provider UnitingCare Queensland experienced a cyber-attack to their network, causing loss of access to the national My Health Record system across their hospitals and aged care facilities. Based on previous attacks and the nature of the information to which UnitingCare has access, it is believed that the hackers were trying to access personal patient information and records to either destroy or use to blackmail targeted individuals. The attack also caused significant disruptions across internal patient systems as well as telephones, emails, Wi-Fi – even the photocopier machines.

Shortly after the breach had been identified, UnitingCare Queensland published a media statement saying that they had engaged forensic support and notified the Australian Cyber Security Centre (ACSC) of the breach. The Australian Digital Health Agency (ADHA) also made a statement, stating that they had responded by blocking UnitingCare Queensland’s access to the national healthcare system as a precautionary measure, which is in line with its responsibilities as the system operator of the My Health Record system. The ADHA also scanned its national infrastructure to identify signs of the malware that affected UnitingCare Queensland.

The Office of the Australian Information Commissioner (OAIC) has consistently reported, since the beginning of the Notifiable Data Breaches (NDB) scheme in February 2018, that the highest reporting industry sector is the healthcare industry (23%), followed by finance (15%). Just 6 weeks earlier, Eastern Health in Victoria also suffered a similar cyber-attack to that of UnitingCare Queensland.

The latest NDB report for the period 1st July-31st December 2020 released by OAIC on 8th January 2021, notes that the kinds of personal information involved in the data breaches comprised 40% financial details, 26% health information and 18% tax file numbers. With regards to the sources of data breaches in the healthcare sector, 57% were attributed to human error, 41% to malicious or criminal attacks and 2% to system failure.

ACSC, in their 2020 Health Sector Snapshot, highlighted the fact that the COVID-19 pandemic had experienced a rise in cyber-attacks on healthcare systems, warning that ransomware is ‘the most significant cybercrime threat to the Australian health sector.’ The healthcare sector is a particularly vulnerable target for cyber-attacks because 1) it holds sensitive personal information about individuals as well as technology and research data about the COVID-19 vaccine which can lead to greater ransom demands, and 2) the essential nature of health care services and public trust in them means there is significant pressure on health care organisations to immediately address and respond to breaches.

As with any cyber-attack on any system, the ACSC recommends that individuals and corporations:

keep their software up to date;
use multi-factor authentication; and
store backups offline.

If you’re a business owner, the Australian Government’s ‘Support for businesses in Australia’ website also recently published a helpful guide on ‘How to protect your business from cyber threats which includes useful information on how to prevent a malicious cyber-attack.

If you would like to know more about how you can help your clients respond to cyberattacks, listen to Episode 16 of Hearsay the Legal Podcast with Reece Corbett-Wilkins from Clyde & Co.

The COVID-19 pandemic has brought about unprecedented changes to economic policy around the globe, and Australia, and New South Wales, are no exception.

Alongside the Federal Government’s payments such as JobKeeper and JobSeeker as the marketable centre-pieces of their COVID-19 economic relief scheme, the NSW State Government rolled out a plethora of tax cuts in an attempt to revive economic growth. One of the most significant changes to the tax system are the changes to stamp duty and land tax, especially given that they account for as much as 36% of NSW tax revenue.

The first change enacted by the NSW Government was the elimination of stamp duty from 1 August 2020 for eligible first home buyers for new homes valued up to $800,000, which is a 23% increase from the previous threshold of $650,000. Concessions continue to apply to homes valued up to $1 million. First home owners purchasing vacant land valued up to $400,000 are also exempt from stamp duty, which is an increase from the previous $350,000. As the first home buyers stamp duty threshold changes were introduced as part of NSW’s initial COVID scheme, they are currently set to expire on 1 August 2021.

Stamp duty is often substantial enough to disincentivise transfers and other economic activity, and is also a volatile source of state income compared to other taxes like land tax, and state governments have been on a slow transition away from reliance on stamp duty over the past few decades. Consistent with that shift, the NSW government is proposing to give home buyers the choice to pay either stamp duty and land tax, or a new annual property tax. Treasury NSW claims that by ‘removing the upfront cost of stamp duty could remove tens of thousands of dollars from the home purchase process and make it easier for first home buyers, families looking to upgrade and others looking to change their property to save what is needed to purchase their next home.’ Critics say that the change might create a ‘two-tiered’ property market, with different prices for properties subject to and not subject to the annual tax.

The NSW Treasury’s Consultation Paper ‘Buying in NSW, Building a Future’, acknowledges that the state’s economy has changed profoundly since stamp duty was first introduced in 1865, and that we accordingly need a modern tax system that reflects those changes. In particular, Australia has moved from a predominantly industrial workforce to a professional one, with statistics showing that Australians have 17 job changes across 5 different careers over their working lives. Stamp duty was implemented at a time when house prices were lower relative to income and buyers did not tend to regularly buy and sell property – which is no longer an accurate reflection of the Australian property market.

Episode 20 of Hearsay the Legal Podcast features an interview with Oliver Berkmann on the state tax regime in NSW, including stamp duty and land tax, if you would like to know more.

The new small business restructuring process (SBRP) under Part 5.3B of the Corporations Act 2001 (Cth) (‘Corporations Act’) came into effect on 1 January 2021 with the aim of streamlining insolvency law and its processes to ‘save’ viable small businesses. Treasurer Josh Frydenberg stated that the SBRP is part of the government’s plan to help rebuild Australia’s economy in a post-pandemic environment and give businesses ‘the opportunity to turnaround, restructure and survive.’ The SBRP is the first semblance of a debtor-in-possession insolvency model in Australia, in which a small business owner retains control over the business during the insolvency process.

To take advantage of the SBRP, a business must meet the following eligibility requirements:

be incorporated under the Corporations Act;
have total liabilities do not exceed $1 million (excluding employee entitlements); and
be insolvent, or likely to become insolvent at some future time.

Following the appointment of a small business restructuring practitioner, companies must produce a restructuring plan to creditors within 20 business days of entering the SBRP, after which time creditors have 15 business days to vote on the proposed plan. The restructuring practitioner’s remuneration, as a percentage of creditor disbursements, is also included in the plan which creditors must be aware of and consent to.

Hearsay guest and insolvency law expert Jason Harris published an article ‘Comparing the Start of Parts 5.3A and 5.3B’ where he discussed the key takeaways the industry can draw from the initial stages of the SBRP. He identified that as at 20th April 2021, there were only 8 notices of appointment, however 3 were duplicates for the same companies meaning there was a total of 5 appointments in the first 4 months of the commencement of the SBRP. During drafting stages, the government emphasised how the new process would cover 76% of all external administrations, yet this has not been reflected in the small number of appointments since its commencement. Comparatively, the first 4 months after the introduction of the voluntary administration regime saw 142 appointments in 1993.

Harris advocates in his article for the implementation of a business viability scheme, as suggested by the ASBFEO in their July 2020 Insolvency Practices Inquiry, to address the issue of many small businesses being ‘too poor to go broke.’ While business advisors can help small businesses navigate formal insolvency processes, which are expensive and may result in an unfavourable outcome, many small businesses cannot afford their expertise and therefore aren’t in a position to make decisions about what to do with their business.

Listen to our interview with Professor Jason Harris, and Mark Wellard from the University of Technology Sydney, in Episode 27 of Hearsay if you’d like to learn more about the strengths and weaknesses of the new small business restructuring process regime.

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