26 September 2023

New rules make trust deeds more trustworthy

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Western Australia is set to have the most rigorous and comprehensive charitable trusts laws in the nation with the introduction of the Charitable Trusts Bill 2022 into Parliament.

Replacing the Charitable Trusts Act 1962, the new legislation includes extensive new investigative powers to ensure charitable trusts are managed in accordance with the objects of their trust deed.

Attorney General, John Quigley said many charitable trusts were established for the purpose of advancing the interests of Indigenous communities and the final report into the Njamal People’s Trust recommended a raft of reforms to the current legislation.

“The Bill addresses a series of gaps in the current framework identified in the report, significant among them being the absence of any compulsive powers to require a person to attend and give evidence on oath or affirmation,” Mr Quigley said.

“The Bill establishes the Western Australian Charitable Trusts Commission, which will be able to conduct investigations upon receiving a complaint about a charitable trust.”

He said the Commission would undertake investigations under significantly expanded powers akin to those of a Royal Commission.

“It will have the ability to issue a notice requiring a person to provide a document or other information relating to a charitable trust or concerning any person involved in the administration of a charitable trust,” Mr Quigley said.

“It will be able to compel the production of documents and the attendance of persons to answer questions before the investigator and be examined under oath or affirmation.”

He said non-compliance with these requirements would attract a maximum penalty of $50,000 — a 10-fold increase to the existing penalty to reflect the seriousness of the offence.

“The current Charitable Trusts Act was written back in 1962 and it is not fit for purpose today. Tens of millions of dollars of native title settlement monies are being paid into these trusts,” Mr Quigley said.

“As the Attorney General, I receive many complaints from Indigenous groups that funds of a charitable trust are being misused by the trustees or by others involved in the administration of the trust.”

He said concerns raised in relation to the Njamal People’s Trust in 2017 led to the appointment of then Deputy State Counsel, Alan Sefton, to conduct a formal inquiry.

“Mr Sefton’s report recommended a raft of reforms and the Bill implements the 21 legislative reforms recommended,” the Attorney-General said.

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