Part 1
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Commonwealth act
This Act has been repealed and is no longer in force. It is retained for historical reference.
The Act establishes the government-owned Housing Loans Insurance Corporation to sell mortgage insurance to lenders, protecting them against losses from borrower default. It gives the Commonwealth financial backing and oversight while the Corporation operates commercially.
By reducing lender risk, the scheme aims to increase access to home loans, support residential construction and ownership, and act as a government backstop for the housing finance market.
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Direct links to the current provisions in Housing Loans Insurance Act 1965.
This Act may be cited as the Housing Loans Insurance Act 1965.
This Act shall come into operation on the day on which it receives the Royal Assent.
(1) In this Act, unless the contrary intention appears:
agency contract means a contract approved by the Corporation that makes provision for an approved lender to act:
(a) in relation to a loan in respect of which a contract of insurance is proposed to be entered into between the lender, not being an approved lender, and the Corporation—as the agent of the lender;
(b) in relation to a loan to which a contract of insurance relates, being a loan that is secured by an approved security—as the agent of a person, not being an approved lender:
(i) to whom the approved security has been or is to be transferred or assigned or in whom that security has become vested; and
(ii) to whom the contract of insurance has been, or is to be, assigned; or
(c) in relation to a loan to which a contract of insurance relates, being a loan that is not secured by an approved security‑as the agent of a person, not being an approved lender:
(i) to whom the right of repayment of the loan has been, or is to be, transferred or assigned; and
(ii) to whom the contract of insurance has been, or is to be, assigned.
approved dealer, or approved lender, means a person approved as a dealer, or as a lender, as the case may be, by the Corporation under section 5, but, except as provided by subsection 5(4), does not include a person whose approval under that section has been revoked.
approved security means:
(a) a first legal mortgage or a mortgage that will, upon registration under a law of a State or Territory, constitute a first legal mortgage;
(b) a mortgage registered under a law of a State or Territory and having priority subject only to a first legal mortgage or to a first legal mortgage and another mortgage or other mortgages so registered; or
(c) a mortgage that will, upon registration under a law of a State or Territory, take priority subject only to a first legal mortgage, or to a first legal mortgage and another mortgage or other mortgages that are so registered;
and includes, in relation to such prescribed interests as the regulations specify in respect of a particular kind of security, a security of that kind.
building includes any structure, but does not include a building or structure constructed, being constructed or intended to be constructed for a temporary purpose.
contract of insurance means a contract of insurance under this Act.
dwelling‑house includes:
(a) any building that consists, or any buildings that consist, in whole or in substantial part, of residential accommodation, whether constituting a single unit of accommodation or two or more such units; and
(b) any residential accommodation of a kind commonly known as a flat or home unit.
General Reserve means the reserve continued in existence under the name “Housing Loans Insurance Corporation General Reserve” by section 31A.
insurable loan means:
(a) a loan made for the purpose of enabling the borrower;
(i) to alter, improve or extend a dwelling house constructed on land in which the borrower has a prescribed interest; or
(ii) to meet expenses in respect of the provision or improvement of roads, kerbing, guttering or footpaths in connection with land in which the borrower has a prescribed interest, being land on which there has been a dwelling house or on which a dwelling house is being constructed;
being a loan made in accordance with terms and conditions approved by the Corporation; or
(b) a loan the repayment of which is secured by an approved security over a prescribed interest of the borrower, or of any other person, in land.
lender, in relation to an insurable loan, includes any person having the right to receive repayment of the loan.
member means a member of the Corporation and includes the Chairman and the Deputy Chairman.
mortgage, in relation to an interest as lessee, includes a mortgage by way of sublease or assignment of lease.
negotiable mortgage security means a document, being a promissory note, bill of exchange, certificate of entitlement or other evidence or acknowledgment of indebtedness (other than an approved security), where:
(a) the document entitles the holder thereof to the whole or part of, or an interest in the whole or part of, the entitlement of the mortgagee or mortgagees under one or more approved securities over one or more prescribed interests in land;
(b) the document is redeemable from moneys directly or indirectly derived from, or connected with, approved securities over prescribed interests in land; or
(c) the document is otherwise related to approved securities over prescribed interests in land and is included in a class of documents declared by the regulations to be negotiable mortgage securities for the purposes of this Act.
part‑time member means a member referred to in paragraph (c) of subsection (1) of section 7.
prescribed interest, in relation to land, means:
(a) an estate in fee simple;
(b) an interest as lessee under a lease in perpetuity from the Crown in right of the Commonwealth or a State, including a suburban holding under the Crown Lands Consolidation Act, 1913 of the State of New South Wales, or under that Act as amended at any time or under an Act enacted in substitution for that Act, being a suburban holding an application for which has been confirmed in accordance with the law of that State;
(c) an interest as lessee under a lease for a term of years from the Crown in right of the Commonwealth or a State or from the owner of an estate in fee simple if the Corporation is satisfied that the term, covenants and conditions of the lease give reasonable security of tenure to the lessee for a substantial period;
(d) any other interest declared by the regulations to be a prescribed interest for the purposes of this Act; or
(e) any right in relation to land, not being an interest in land, that is declared by the regulations to be deemed to be a prescribed interest for the purposes of this Act.
the Auditor‑General means the Auditor‑General for the Commonwealth.
the Chairman means the Chairman of the Corporation.
the Corporation means the Housing Loans Insurance Corporation established by this Act.
the Deputy Chairman means the Deputy Chairman of the Corporation.
the Deputy Managing Director means the Deputy Managing Director of the Corporation.
the Managing Director means the Managing Director of the Corporation.
(2) A reference in this Act to a dwelling‑house or to a building other than a dwelling‑house shall be read as including a reference to appurtenances, outbuildings, fences and permanent provision for lighting, water‑supply, drainage and sewerage provided in connection with the dwelling‑house or the building other than a dwelling‑house, as the case may be. (3) A reference in this Act to the rights of a person under a security shall be read as including a reference to the right of that person to payment of the moneys secured by the security. (4) Except where the contrary intention appears, a reference in this Act to the Corporation entering into a contract does not include a reference to the Corporation entering into a contract in pursuance of subsection 17(3B).
(2) The Corporation may, by instrument in writing, approve a person as a dealer, or as a lender, or as both, for the purposes of this Act. (3) The Corporation shall cause notice of the approval, or the revocation of the approval, of a person under this section to be published in the Gazette. (4) Notwithstanding the revocation, in whole or in part, of the approval of a person under subsection (2), the person shall continue to be either or both of the following, as the case requires, namely: (a) an approved dealer for the purposes of this Act in relation to any approved security that is the subject of a contract of insurance entered into under paragraph 17(2)(b) by the Corporation before the revocation; and (b) an approved lender for the purposes of this Act in relation to any loan that is the subject of a contract of insurance or re‑insurance entered into by the Corporation before the revocation.
(1) For the purposes of this Act, there is hereby established a body by the name of the Housing Loans Insurance Corporation. (2) The Corporation: (a) is a body corporate, with perpetual succession; (b) shall have a common seal; (c) may acquire, hold and dispose of real and personal property; and (d) may sue and be sued in its corporate name.
Note: The Commonwealth Authorities and Companies Act 1997 applies to the Corporation. That Act deals with matters relating to Commonwealth authorities, including reporting and accountability, banking and investment, and conduct of officers.
(3) All courts, judges and persons acting judicially shall take judicial notice of the common seal of the Corporation affixed to a document and shall presume that it was duly affixed.
(1) The Corporation shall consist of five members, namely: (a) a Chairman; (b) a Deputy Chairman; and (c) three other members. (2) The members shall be appointed by the Governor‑General. (3) The members referred to in paragraph (c) of subsection (1) of this section shall be appointed as part‑time members. (4) The appointment of a person as a member takes effect on such date as is specified in the instrument of appointment. (5) The Chairman and the Deputy Chairman are entitled to retire at any time after attaining the age of 55 years. (6) Subject to this Act, the Chairman and the Deputy Chairman hold office for such respective periods, not exceeding seven years, as are fixed by the Governor‑General at the time of their appointments, but are eligible for re‑appointment. (7) A person who has attained the age of sixty‑five years shall not be appointed as Chairman or Deputy Chairman. (8) Subject to this Act, a part‑time member holds office for such period, not exceeding three years, as is fixed by the Governor‑General at the time of his appointment, but is eligible for re‑appointment. (9) A person shall not be appointed as a member for a period that extends beyond the date on which he will attain the age of seventy years. (10) A member holds office on such terms and conditions (if any) in relation to matters not provided for by this Act as are determined, in writing, by the Governor‑General. (11) The exercise of a power or the performance of a function by the Corporation is not invalidated by reason only of there being a vacancy or vacancies in the membership of the Corporation.
(1) The Minister may appoint a person to act as Chairman: (a) during a vacancy in the office of Chairman; or (b) during any period, or during all periods, when the Chairman is absent from duty or from Australia or is, for any other reason, unable to perform the duties of the office. (2) The Minister may appoint a person to act as Deputy Chairman: (a) during a vacancy in the office of Deputy Chairman; or (b) during any period, or during all periods, when the Deputy Chairman is absent from duty or from Australia, is acting as Chairman or is, for any other reason, unable to perform the duties of the office. (3) An appointment of a person under subsection (1) or (2) may be expressed to have effect only in specified circumstances. (4) A person appointed under subsection (1) or (2) to act during a vacancy in the office of Chairman or Deputy Chairman shall not continue to act for more than 12 months. (5) Where: (a) a person is acting as Chairman under paragraph (1)(b) or as Deputy Chairman under paragraph (2)(b); and (b) the office of Chairman or Deputy Chairman, as the case may be, becomes vacant; then, subject to subsection (3), the person may continue to act until: (c) the Minister otherwise directs in writing; (d) the vacancy is filled; or (e) a period of 12 months from the day on which the vacancy occurred expires; whichever happens first. (6) A person acting as Chairman or Deputy Chairman has all the powers and duties of the Chairman and Managing Director, or Deputy Chairman and Deputy Managing Director, as the case may be. (7) The Minister may: (a) determine the terms and conditions of appointment, including remuneration and allowances, of a person appointed to act as Chairman or Deputy Chairman; and (b) terminate the appointment at any time. (8) A person appointed to act as Chairman or Deputy Chairman may resign the appointment by writing signed by the person and delivered to the Minister. (9) Anything done by or in relation to a person purporting to act as Chairman or Deputy Chairman is not invalid because: (a) the occasion for the appointment had not arisen; (b) there was a defect or irregularity in connection with the appointment; (c) the appointment had ceased to have effect; or (d) the occasion for the person to act had not arisen or had ceased.
(1) Subject to this section, the Corporation shall meet at such times and places as the Chairman thinks necessary for the efficient conduct of the affairs of the Corporation. (2) The Chairman shall, upon the request in writing of not less than two members, convene a meeting of the Corporation. (3) The Minister may at any time convene a meeting of the Corporation. (4) The Chairman shall preside at all meetings of the Corporation at which he is present, and, in the absence of the Chairman, the Deputy Chairman, if he is present, shall preside. (5) In the absence of both the Chairman and the Deputy Chairman from a meeting, the members present shall appoint a member to preside at that meeting (6) At a meeting of the Corporation, three members constitute a quorum. (7) Questions arising at a meeting of the Corporation shall be decided by a majority of the votes of the members present and voting. (8) The member presiding at a meeting of the Corporation has a deliberative vote and, in the event of an equality of votes, also has a casting vote. (9) The Corporation shall keep a record of its proceedings.
(1) The Governor‑General may terminate the appointment of a member for misbehaviour or physical or mental incapacity. (2) If: (a) a member becomes bankrupt, applies to take the benefit of a law for the relief of bankrupt or insolvent debtors, compounds with his or her creditors or makes an assignment of his or her remuneration for their benefit; (b) a member, without reasonable excuse, contravenes section 21 of the Commonwealth Authorities and Companies Act 1997; (c) the Chairman or Deputy Chairman: (i) engages in paid employment outside the duties of his or her office without the approval of the Minister; or (ii) is absent from duty, except on leave of absence granted by the Minister, for 14 consecutive days or 28 days in any 12 months; or (d) a member (other than the Chairman or Deputy Chairman) is absent, except on leave of absence granted by the Minister, from 3 consecutive meetings of the Corporation; the Governor‑General shall terminate the member's appointment.
(1) A member shall be paid such remuneration as is determined by the Remuneration Tribunal. (2) A member shall be paid such allowances as are prescribed. (3) This section has effect subject to the Remuneration Tribunals Act 1973.
The Minister may grant leave of absence to a member upon such terms and conditions as to remuneration or otherwise as the Minister determines.
A member may resign his office by writing under his hand addressed to the Governor‑General.
(1) Subject to this Act and to the directions of the Corporation, the business of the Corporation shall be managed by a Managing Director. (2) The Chairman shall, by virtue of his office, be the Managing Director. (3) There shall be a Deputy Managing Director of the Corporation who shall, in accordance with the directions of the Managing Director, assist the Managing Director in the management of the business of the Corporation. (4) The Deputy Chairman shall, by virtue of his office, be the Deputy Managing Director.
The Insurance (Deposits) Act 1932‑1973, to the extent to which it requires deposits with the Treasurer, does not apply to the Corporation.
(1) The Corporation shall carry on the business of insurance as provided by this Act. (2) Subject to this Act, the Corporation is empowered to enter into a contract of insurance: (a) insuring a lender against the whole or part of any loss in respect of an insurable loan made, or proposed to be made, by the lender; or (b) insuring an approved dealer against the whole or part of any loss of a kind specified in the regulations, being loss that is directly or indirectly connected with one or more approved securities relating to negotiable mortgage securities issued, or proposed to be issued, by the dealer. (2A) The Corporation shall not enter into a contract of insurance under paragraph (2)(a) unless: (a) the lender is an approved lender; or (b) an agency contract is in force in relation to the loan in respect of which the contract of insurance is to be entered into. (3) The loss in respect of which a lender may be insured under a contract of insurance entered into by the Corporation includes: (a) loss of moneys constituting the loan; (b) loss of interest and other charges on or in relation to the loan; and (c) any other loss arising from any default in relation to the loan. (3A) Subsection (3) shall not be taken to limit the generality of paragraph (2)(b). (3B) Subject to this Act, the Corporation is empowered to enter, as the agent of an insurer, into a contract of insurance insuring a person against the whole or part of any loss arising from the person having to perform obligations of a mortgagor under an approved security over a prescribed interest in land. (3C) The Minister may, from time to time, by instrument in writing, direct the Corporation to enter, under subsection (2), into contracts in respect of loans included in a class of loans specified in the direction, being loans: (a) made for purposes that accord with the policies of the Government of the Commonwealth in relation to housing; and (b) in respect of which the Corporation would not so enter into contracts in the ordinary course of business, and, subject to subsection (2A), the Corporation shall comply with the direction. (3D) The Minister shall not give a direction under subsection (3C) unless he has given the Corporation a reasonable opportunity to furnish advice to him on the matter and has had regard to any advice so furnished. (3E) The Minister shall cause a copy of a direction given under subsection (3C) to be laid before each House of the Parliament within 15 sitting days of that House after the giving of the direction. (4) Subject to this Act, the terms and conditions to be included in contracts of insurance to be entered into by the Corporation shall be such as are determined by the Corporation. (5) A contract of insurance that is entered into with a lender who is not an approved lender may be cancelled by the Corporation if, at any time after the contract is entered into, an agency contract is not in force in relation to the loan to which that contract of insurance relates. (6) The Corporation shall ensure as far as practicable that a substantial part of its business relates to loans made for purposes of enabling persons to acquire or construct residential accommodation.
(1) Where: (a) a company has entered into, or proposes to enter into, a contract of insurance insuring an approved lender against the whole or part of any insurable loss in respect of an insurable loan made, or proposed to be made, by the lender; and (b) the company is a subsidiary of the approved lender; the Corporation may enter into a contract re‑insuring the whole or part of any loss of the company under the contract of insurance. (2) Subject to this Act, the terms and conditions to be included in contracts of re‑insurance to be entered into by the Corporation shall be such as are determined by the Corporation. (3) Notwithstanding that a company ceases to be a subsidiary of an approved lender, the company shall, for the purposes of subsection (1), continue to be a subsidiary of the approved lender in relation to any contract of insurance that is the subject of a contract of re‑insurance entered into by the Corporation before the company ceased to be a subsidiary of the approved lender. (4) The question whether a company is a subsidiary of an approved lender shall be determined in the same manner as the question whether a corporation is a subsidiary of another corporation is determined for the purposes of the Companies Act 1981. (5) In subsection (1):
insurable loss, in relation to an insurable loan, includes:
(a) loss of moneys constituting the loan;
(b) loss of interest and other charges on or in relation to the loan; and
(c) any other loss arising from any default in relation to the loan.
The Corporation has power to do all things necessary or convenient to be done for or in connexion with, or as incidental to, the carrying on of its business.
(1) Where an approved security is transferred or assigned to, or becomes vested in, the Corporation in consequence of the making of a payment by the Corporation under a contract of insurance, the Corporation is empowered: (a) to dispose of its rights under the security; or (b) if it is satisfied that in all the circumstances it is desirable to do so, to enter into an arrangement: (i) for the variation of any of the provisions of the security; or (ii) for the discharge of the security upon condition that a new security, containing such terms and conditions as the Corporation determines, is executed in favour of the Corporation for an amount not exceeding the amount of the loan and interest and other moneys then outstanding under the existing security. (2) The Corporation is empowered to dispose of its rights under a security the provisions of which have been varied in pursuance of an arrangement entered into under the last preceding subsection or under a new security executed in pursuance of such an arrangement. (3) Where a security collateral to an approved security is transferred or assigned to, or becomes vested in, the Corporation in consequence of the making of a payment by the Corporation under a contract of insurance, the Corporation is empowered to dispose of its rights under that security or, subject to any arrangement entered into under this section, to realize that security. (4) The powers of the Corporation under this section: (a) are in addition to any other powers or rights the Corporation has in relation to a security; and (b) may be exercised at any time. (5) Where, in pursuance of subsection (1) or (2), the Corporation disposes of its rights under a security to a person, the Corporation is empowered to enter into a contract of insurance under section 17 with that person in respect of so much of the loan secured by the security as is then outstanding as if that amount were the amount of an insurable loan made, or proposed to be made, by that person.
(1) The Minister may, from time to time, by instrument in writing, direct the Corporation not to enter into contracts of insurance in respect of a class of insurable loans specified in the direction, and the Corporation shall comply with that direction. (2) The Minister may, from time to time, by instrument in writing, direct the Corporation not to enter into contracts of insurance in respect of approved securities relating to a class of negotiable mortgage securities specified in the direction, and the Corporation shall comply with that direction. (3) The Minister may direct the Corporation, in writing, not to enter into specified classes of contracts of re‑insurance, and the Corporation shall comply with the direction.
A contract of insurance in relation to an insurable loan or in relation to an approved security that relates to negotiable mortgage securities may include provision, however expressed, for the making of a payment by the Corporation under the contract notwithstanding that the person insured or any other person has not exercised any or all of that person’s rights in relation to a matter to which the contract relates, other than rights under the contract.
(1) Subject to this Act, the Corporation may adopt such policy as it determines with respect to any matter related to the conduct of its business. (2) Where the Corporation adopts any policy, including an altered policy, the Corporation shall inform the Minister of the policy it has adopted. (3) Before adopting a policy, including an altered policy, with respect to a matter declared by the regulations to be a reserved matter for the purposes of this section, or continuing to pursue a policy with respect to a matter that is so declared, the Corporation shall submit the proposed policy for the approval of the Minister, and shall not adopt, or continue to pursue, the policy without the approval of the Minister, or, except during such time as the Minister permits, continue to pursue the policy where the Minister, having approved the policy, subsequently withdraws his approval. (4) If the Corporation fails to obtain the Minister’s approval to the adoption or continuation of a policy with respect to a matter to which the last preceding subsection applies, or the Minister withdraws his approval of such a policy, the Corporation shall endeavour to reach agreement with the Minister as to the policy to be adopted by the Corporation with respect to that matter and, in the event of agreement not being reached within a time which the Minister considers reasonable, the Minister may, by writing under his hand, determine a policy to be adopted by the Corporation with respect to that matter, and the Corporation shall adopt that policy. (5) Nothing in this section requires the approval of the Minister to the entering by the Corporation into a particular contract of insurance or re‑insurance or empowers the Minister to determine that the Corporation shall or shall not enter into a particular contract of insurance or re‑insurance, but the Corporation shall not enter into a particular contract of insurance or re‑insurance if it would be contrary to a policy approved or determined by the Minister under this section to enter into that contract. (6) A reference in subsection (5) to the Corporation entering into a contract includes a reference to the Corporation entering into a contract in pursuance of subsection 17(3B).
(1) The Corporation shall charge a premium in respect of each contract of insurance or re‑insurance entered into by the Corporation and may make charges for other matters in connexion with its business. (2) The premiums and other charges shall be: (a) in the case of a contract entered into in pursuance of a direction given under subsection 17(3C)—as determined by the Corporation within such limits (if any) as are determined by the Minister; or (b) in any other case‑as determined by the Corporation. (2A) The Minister shall not make a determination under paragraph (2)(a) unless he has given the Corporation a reasonable opportunity to furnish advice to him on the matter and has had regard to any advice so furnished. (3) The Corporation may refund, in circumstances relating to the cessation or reduction of the liability of the Corporation under a contract, part of the premium paid in relation to the contract. (4) The Corporation shall carry out its operations as efficiently as possible and the premiums charged by the Corporation and the other charges made by it shall be at the lowest possible rates having regard to the duty imposed on the Corporation by subsection (5). (5) The Corporation shall pursue a policy directed towards securing revenue sufficient to meet all its expenditure and provision for expenditure properly chargeable to revenue, and to permit the payment to the Commonwealth, in addition to the payment of income tax, of a reasonable return on the capital of the Corporation. (6) Subsections (4) and (5) have effect subject to subsection 17(3C).
(1) Nothing in this Act obliges the Corporation to enter into a contract of insurance or re‑insurance in respect of any particular loan. (2) A reference in subsection (1) to the Corporation entering into a contract includes a reference to the Corporation entering into a contract in pursuance of subsection 17(3B).
The Corporation may appoint such officers and engage such employees as it thinks necessary for the purposes of this Act.
(1) The terms and conditions of employment of persons appointed or engaged under the last preceding section shall be such as are, subject to the next succeeding subsection, determined by the Corporation, with the approval of the Public Service Board.
By force of this section, the Commonwealth guarantees the due payment by the Corporation of all money (other than money due in respect of money borrowed under section 31D) that is, or may at any time become, payable by the Corporation to a person other than the Commonwealth.
The capital of the Corporation at any time is the sum of: (a) an amount of $5,000,000 transferred to the capital account of the Corporation in pursuance of subsection (2) of section 31A; (b) any amounts paid to the Corporation by the Minister for Finance after the commencement of this section out of moneys appropriated by the Parliament for the purpose of providing further capital for the Corporation; and (c) any amounts transferred from the General Reserve to the capital account of the Corporation in pursuance of directions given under subsection (4) of section 31A; less the sum of any amounts of capital repaid to the Commonwealth by the Corporation after the commencement of this section.
(1) The reserve referred to in section 35 of the Housing Loans Insurance Act 1965 as amended and in force immediately before the date of commencement of this section continues in existence, on and after that date, by force of this section, as a general reserve under the name “Housing Loans Insurance Corporation General Reserve”. (2) As soon as practicable after the commencement of this section, the Corporation shall: (a) pay to the Commonwealth, out of the General Reserve, an amount of $4,500,000; and (b) transfer to the capital account of the Corporation, out of the General Reserve, an amount of $5,000,000. (3) There shall be transferred to the General Reserve the balance (if any) of the profits of the Corporation for a financial year after the payment by the Corporation to the Commonwealth of such amounts out of those profits as the Minister determines under subsection (1) of section 31B. (4) The Minister may from time to time direct the Corporation to transfer a specified amount from the General Reserve to the capital account of the Corporation, and the Corporation shall comply with such a direction. (5) In giving a direction under subsection (4), the Minister shall have regard to any advice that the Corporation has furnished to him in relation to the financial affairs of the Corporation.
(1) Interest is not payable to the Commonwealth on the capital of the Corporation but the Corporation shall pay to the Commonwealth, out of the profits of the Corporation for the financial year that commenced on 1 July 1976 and for each succeeding year, such amount as the Minister determines. (1A) For the purpose of placing the Corporation, as far as practicable, on an equal footing with other insurers, the Corporation shall pay to the Commonwealth in respect of a financial year an amount determined by the Minister. (2) The capital of the Corporation is repayable to the Commonwealth at such times and in such amounts as the Minister determines. (3) In the making of a determination under subsection (1) or (2), the Minister shall have regard to: (a) any advice furnished by the Corporation to the Minister in relation to the financial affairs of the Corporation; and (b) any losses that have resulted, or are likely to result, from compliance by the Corporation with directions given under subsection 17(3C). (4) In the making of a determination under subsection (1A), the Minister shall have regard to: (a) any reinsurance costs of the Corporation; (b) the reinsurance costs of other insurers; and (c) the amount of business carried on by the Corporation. (5) In this section, insurer means a person carrying on the business of insuring lenders against loss in respect of loans secured by mortgages.
(1) The Corporation shall, from time to time during a financial year, pay to the Commonwealth such an amount, or such amounts, as the Minister directs on account of the amount that is expected to become payable by the Corporation in respect of that financial year in accordance with a determination of the Minister under subsection (1) or (1A) of section 31B. (2) The Minister shall not make a direction under subsection (1) during a financial year unless he has given the Corporation a reasonable opportunity to furnish to him particulars of its estimated profits for that financial year and any advice that the Corporation wishes to furnish to him concerning its financial affairs and has had regard to any particulars and advice so furnished to him. (3) Where the amount, or the total of the amounts, paid by the Corporation to the Commonwealth during a financial year under subsection (1) of this section exceeds the amount (if any) on account of which the amount was, or amounts were, paid, the amount of the excess shall be treated as having been paid by the Corporation to the Commonwealth under subsection (1) of this section during the next succeeding financial year.
(1) The Corporation may, with the approval of the Treasurer, borrow moneys that are from time to time necessary for the exercise of its powers or the performance of its duties or functions under this Act. (2) The Minister for Finance may, on behalf of the Commonwealth, out of moneys appropriated by the Parliament for the purpose, lend to the Corporation, at such rate of interest and on such other terms and conditions as he determines, moneys that the Corporation is authorized to borrow under subsection (1). (3) The Corporation may give security over the whole or any part of its assets for the repayment of amounts borrowed under this section and the payment of interest on amounts so borrowed. (4) The Treasurer may, on behalf of the Commonwealth, guarantee the repayment by the Corporation of amounts borrowed under this section otherwise than from the Commonwealth and the payment of interest on amounts so borrowed. (5) The Corporation shall not borrow moneys except in accordance with this section.
(1) The moneys of the Corporation shall be applied only: (a) in payment or discharge of the costs, expenses and other obligations of the Corporation; (b) in payment of remuneration and allowances payable to any person appointed or employed under this Act; and (c) in making payments to the Commonwealth as provided by this Act. (2) Subsection (1) does not prevent investment of surplus money of the Corporation under section 19 of the Commonwealth Authorities and Companies Act 1997.
For the purposes of this Act, the profits of the Corporation for a financial year are the amount (if any) remaining after deducting from the revenue received or receivable in respect of that financial year the expenditure and provision for expenditure properly chargeable against that revenue.
(2) The Corporation shall keep a separate account of its receipts and expenditure arising out of business carried on in pursuance of directions given under subsection 17(3C).
The Corporation shall not, except with the approval of the Minister, enter into a contract (not being a contract entered into by the Corporation by virtue of powers conferred on it by section 17, 17A or 19 of this Act, or subsection 19(3) of the Commonwealth Authorities and Companies Act 1997) involving the payment or receipt by the Corporation of an amount exceeding $250,000, or, if a higher amount is prescribed by the regulations, that higher amount.
(1) The Corporation shall pay all rates, taxes and charges under any law of the Commonwealth, a State or a Territory. (2) The Corporation is not a public authority for the purposes of paragraph (d) of section 23 of the Income Tax Assessment Act 1936. (3) Securities issued by the Corporation are not public securities or Commonwealth securities for the purposes of the Income Tax Assessment Act 1936. (4) The provisions of the Income Tax Assessment Act 1936 that relate to depreciation apply in relation to the Corporation as if: (a) the Corporation had, at all times, been liable to pay taxes on income under the laws of the Commonwealth and depreciation had been allowed in assessments accordingly; (b) the Corporation had not, in relation to the first year of income in respect of which it was so liable, exercised the option referred to in paragraph (b) of subsection (1) of section 56 of that Act; and (c) in the case of a unit of property owned by the Corporation that became so owned before 1 July 1976, the Commissioner had, for the purposes of the calculation of the first depreciation that would have been allowed in respect of that unit after the Corporation had been so liable to pay taxes on income, made such estimate of the effective life of the unit as, in the opinion of the Commissioner, would have been the appropriate estimate; except that, for the purpose of calculating, in respect of any property of the Corporation, the sum referred to in subsection (2) of section 59 of that Act, the Corporation shall not be treated as having been allowed any amount as depreciation that has not in fact been allowed.
The annual report on the Corporation under section 9 of the Commonwealth Authorities and Companies Act 1997 must also set out: (a) all directions given to the Corporation by the Minister under subsection 17(3C), section 20 or subsection 31A(4) or 31C(1) during the year to which the report relates; and (b) all determinations made by the Minister under subsection 25(4) or 31B(1) or (2) during the year to which the report relates.
A Minister cannot, under paragraph 16(1)(b) or (c) of the Commonwealth Authorities and Companies Act 1997, require the members of the Corporation to give that Minister a report, document or information relating to the affairs of a particular person.
Where the Minister requests the Corporation to furnish to him, in respect of a period of 3 months ending on 31 March, 30 June, 30 September or 31 December, a return, in accordance with the form approved by him, with respect to: (a) contracts of insurance and re‑insurance entered into by the Corporation in that period of 3 months; and (b) contracts of insurance and re‑insurance entered into by the Corporation and not discharged before the end of that period of 3 months; the Corporation shall comply with the request as soon as practicable after the request is made.
A contract of insurance or re‑insurance entered into by the Corporation is not invalidated by reason of: (a) any failure of the Corporation to comply with or observe a provision of this Act or of the regulations or a direction of the Minister; or (b) the contract not being within the limits of the powers of the Corporation under this Act; and all acts and things done by the Corporation in relation to the contract or in exercise of its rights and powers under the contract (including the transfer or assignment of a security and the exercise of rights and powers under or in relation to a security) are as valid as if the provisions of this Act and the regulations and the directions of the Minister had been complied with and observed and the Corporation had not exceeded the limits of its powers.
(1) Subject to subsection (2) and to such terms and conditions (if any) as the Corporation determines, a contract of insurance may be assigned: (a) where the contract relates to an insurable loan secured by an approved security—to the person to whom the approved security is transferred or assigned or in whom that security becomes vested; (b) where the contract relates to an insurable loan not so secured—to the person to whom the right of repayment of the loan is transferred or assigned; or (c) where the contract relates to an approved security or approved securities relating to one or more negotiable marketable securities—to the person to whom any interest in the approved security or approved securities is transferred or assigned. (2) A contract of insurance that is assigned under paragraph (1)(a) or (b) to a person who is not an approved lender may be cancelled by the Corporation if at, or at any time after, the time when the assignment takes effect an agency contract is not in force in relation to the loan in respect of which the contract of insurance was entered into.
(1) A person who, in the course of his duty or employment under or in connexion with this Act as a member of the Corporation, the Managing Director, the Deputy Managing Director or an officer or employee of the Corporation, has acquired, or has access to, information relating to the affairs of a person shall not, except in the course of his duty in connexion with this Act, communicate that information, or make it available, to another person.
Penalty: Five hundred dollars.
(2) A person referred to in the last preceding subsection shall, before entering on the performance of his duties, make and subscribe, before a person authorized under the law of the Commonwealth, of a State or of a Territory to take affidavits, an oath or affirmation of secrecy in accordance with the form in the Schedule.
(1) The Governor‑General may make regulations, not inconsistent with this Act, prescribing all matters which by this Act are required or permitted to be prescribed, or which are necessary or convenient to be prescribed for carrying out or giving effect to this Act, and, in particular, for prescribing penalties not exceeding a fine of One hundred dollars or imprisonment for a period not exceeding three months, or both, for offences against the regulations. (2) After the Corporation commences to carry on business, regulations: (aa) declaring classes of documents to be negotiable mortgage securities for the purposes of this Act; (ab) specifying kinds of loss for the purposes of paragraph 17(2)(b); (a) prescribing securities to be approved securities for the purposes of this Act; or (b) declaring interests in land to be prescribed interests for the purposes of this Act, or any regulations amending or repealing any such regulations, shall not be made unless the regulations are in accordance with a recommendation made to the Minister by the Corporation.
Sourced from the Federal Register of Legislation (legislation.gov.au), CC BY 4.0.
This Act may be cited as the Housing Loans Insurance Act 1965.
This Act shall come into operation on the day on which it receives the Royal Assent.
(1) In this Act, unless the contrary intention appears:
agency contract means a contract approved by the Corporation that makes provision for an approved lender to act:
(a) in relation to a loan in respect of which a contract of insurance is proposed to be entered into between the lender, not being an approved lender, and the Corporation—as the agent of the lender;
(b) in relation to a loan to which a contract of insurance relates, being a loan that is secured by an approved security—as the agent of a person, not being an approved lender:
(i) to whom the approved security has been or is to be transferred or assigned or in whom that security has become vested; and
(ii) to whom the contract of insurance has been, or is to be, assigned; or
(c) in relation to a loan to which a contract of insurance relates, being a loan that is not secured by an approved security‑as the agent of a person, not being an approved lender:
(i) to whom the right of repayment of the loan has been, or is to be, transferred or assigned; and
(ii) to whom the contract of insurance has been, or is to be, assigned.
approved dealer, or approved lender, means a person approved as a dealer, or as a lender, as the case may be, by the Corporation under section 5, but, except as provided by subsection 5(4), does not include a person whose approval under that section has been revoked.
approved security means:
(a) a first legal mortgage or a mortgage that will, upon registration under a law of a State or Territory, constitute a first legal mortgage;
(b) a mortgage registered under a law of a State or Territory and having priority subject only to a first legal mortgage or to a first legal mortgage and another mortgage or other mortgages so registered; or
(c) a mortgage that will, upon registration under a law of a State or Territory, take priority subject only to a first legal mortgage, or to a first legal mortgage and another mortgage or other mortgages that are so registered;
and includes, in relation to such prescribed interests as the regulations specify in respect of a particular kind of security, a security of that kind.
building includes any structure, but does not include a building or structure constructed, being constructed or intended to be constructed for a temporary purpose.
contract of insurance means a contract of insurance under this Act.
dwelling‑house includes:
(a) any building that consists, or any buildings that consist, in whole or in substantial part, of residential accommodation, whether constituting a single unit of accommodation or two or more such units; and
(b) any residential accommodation of a kind commonly known as a flat or home unit.
General Reserve means the reserve continued in existence under the name “Housing Loans Insurance Corporation General Reserve” by section 31A.
insurable loan means:
(a) a loan made for the purpose of enabling the borrower;
(i) to alter, improve or extend a dwelling house constructed on land in which the borrower has a prescribed interest; or
(ii) to meet expenses in respect of the provision or improvement of roads, kerbing, guttering or footpaths in connection with land in which the borrower has a prescribed interest, being land on which there has been a dwelling house or on which a dwelling house is being constructed;
being a loan made in accordance with terms and conditions approved by the Corporation; or
(b) a loan the repayment of which is secured by an approved security over a prescribed interest of the borrower, or of any other person, in land.
lender, in relation to an insurable loan, includes any person having the right to receive repayment of the loan.
member means a member of the Corporation and includes the Chairman and the Deputy Chairman.
mortgage, in relation to an interest as lessee, includes a mortgage by way of sublease or assignment of lease.
negotiable mortgage security means a document, being a promissory note, bill of exchange, certificate of entitlement or other evidence or acknowledgment of indebtedness (other than an approved security), where:
(a) the document entitles the holder thereof to the whole or part of, or an interest in the whole or part of, the entitlement of the mortgagee or mortgagees under one or more approved securities over one or more prescribed interests in land;
(b) the document is redeemable from moneys directly or indirectly derived from, or connected with, approved securities over prescribed interests in land; or
(c) the document is otherwise related to approved securities over prescribed interests in land and is included in a class of documents declared by the regulations to be negotiable mortgage securities for the purposes of this Act.
part‑time member means a member referred to in paragraph (c) of subsection (1) of section 7.
prescribed interest, in relation to land, means:
(a) an estate in fee simple;
(b) an interest as lessee under a lease in perpetuity from the Crown in right of the Commonwealth or a State, including a suburban holding under the Crown Lands Consolidation Act, 1913 of the State of New South Wales, or under that Act as amended at any time or under an Act enacted in substitution for that Act, being a suburban holding an application for which has been confirmed in accordance with the law of that State;
(c) an interest as lessee under a lease for a term of years from the Crown in right of the Commonwealth or a State or from the owner of an estate in fee simple if the Corporation is satisfied that the term, covenants and conditions of the lease give reasonable security of tenure to the lessee for a substantial period;
(d) any other interest declared by the regulations to be a prescribed interest for the purposes of this Act; or
(e) any right in relation to land, not being an interest in land, that is declared by the regulations to be deemed to be a prescribed interest for the purposes of this Act.
the Auditor‑General means the Auditor‑General for the Commonwealth.
the Chairman means the Chairman of the Corporation.
the Corporation means the Housing Loans Insurance Corporation established by this Act.
the Deputy Chairman means the Deputy Chairman of the Corporation.
the Deputy Managing Director means the Deputy Managing Director of the Corporation.
the Managing Director means the Managing Director of the Corporation.
(2) A reference in this Act to a dwelling‑house or to a building other than a dwelling‑house shall be read as including a reference to appurtenances, outbuildings, fences and permanent provision for lighting, water‑supply, drainage and sewerage provided in connection with the dwelling‑house or the building other than a dwelling‑house, as the case may be. (3) A reference in this Act to the rights of a person under a security shall be read as including a reference to the right of that person to payment of the moneys secured by the security. (4) Except where the contrary intention appears, a reference in this Act to the Corporation entering into a contract does not include a reference to the Corporation entering into a contract in pursuance of subsection 17(3B).
(2) The Corporation may, by instrument in writing, approve a person as a dealer, or as a lender, or as both, for the purposes of this Act. (3) The Corporation shall cause notice of the approval, or the revocation of the approval, of a person under this section to be published in the Gazette. (4) Notwithstanding the revocation, in whole or in part, of the approval of a person under subsection (2), the person shall continue to be either or both of the following, as the case requires, namely: (a) an approved dealer for the purposes of this Act in relation to any approved security that is the subject of a contract of insurance entered into under paragraph 17(2)(b) by the Corporation before the revocation; and (b) an approved lender for the purposes of this Act in relation to any loan that is the subject of a contract of insurance or re‑insurance entered into by the Corporation before the revocation.
(1) For the purposes of this Act, there is hereby established a body by the name of the Housing Loans Insurance Corporation. (2) The Corporation: (a) is a body corporate, with perpetual succession; (b) shall have a common seal; (c) may acquire, hold and dispose of real and personal property; and (d) may sue and be sued in its corporate name.
Note: The Commonwealth Authorities and Companies Act 1997 applies to the Corporation. That Act deals with matters relating to Commonwealth authorities, including reporting and accountability, banking and investment, and conduct of officers.
(3) All courts, judges and persons acting judicially shall take judicial notice of the common seal of the Corporation affixed to a document and shall presume that it was duly affixed.
(1) The Corporation shall consist of five members, namely: (a) a Chairman; (b) a Deputy Chairman; and (c) three other members. (2) The members shall be appointed by the Governor‑General. (3) The members referred to in paragraph (c) of subsection (1) of this section shall be appointed as part‑time members. (4) The appointment of a person as a member takes effect on such date as is specified in the instrument of appointment. (5) The Chairman and the Deputy Chairman are entitled to retire at any time after attaining the age of 55 years. (6) Subject to this Act, the Chairman and the Deputy Chairman hold office for such respective periods, not exceeding seven years, as are fixed by the Governor‑General at the time of their appointments, but are eligible for re‑appointment. (7) A person who has attained the age of sixty‑five years shall not be appointed as Chairman or Deputy Chairman. (8) Subject to this Act, a part‑time member holds office for such period, not exceeding three years, as is fixed by the Governor‑General at the time of his appointment, but is eligible for re‑appointment. (9) A person shall not be appointed as a member for a period that extends beyond the date on which he will attain the age of seventy years. (10) A member holds office on such terms and conditions (if any) in relation to matters not provided for by this Act as are determined, in writing, by the Governor‑General. (11) The exercise of a power or the performance of a function by the Corporation is not invalidated by reason only of there being a vacancy or vacancies in the membership of the Corporation.
(1) The Minister may appoint a person to act as Chairman: (a) during a vacancy in the office of Chairman; or (b) during any period, or during all periods, when the Chairman is absent from duty or from Australia or is, for any other reason, unable to perform the duties of the office. (2) The Minister may appoint a person to act as Deputy Chairman: (a) during a vacancy in the office of Deputy Chairman; or (b) during any period, or during all periods, when the Deputy Chairman is absent from duty or from Australia, is acting as Chairman or is, for any other reason, unable to perform the duties of the office. (3) An appointment of a person under subsection (1) or (2) may be expressed to have effect only in specified circumstances. (4) A person appointed under subsection (1) or (2) to act during a vacancy in the office of Chairman or Deputy Chairman shall not continue to act for more than 12 months. (5) Where: (a) a person is acting as Chairman under paragraph (1)(b) or as Deputy Chairman under paragraph (2)(b); and (b) the office of Chairman or Deputy Chairman, as the case may be, becomes vacant; then, subject to subsection (3), the person may continue to act until: (c) the Minister otherwise directs in writing; (d) the vacancy is filled; or (e) a period of 12 months from the day on which the vacancy occurred expires; whichever happens first. (6) A person acting as Chairman or Deputy Chairman has all the powers and duties of the Chairman and Managing Director, or Deputy Chairman and Deputy Managing Director, as the case may be. (7) The Minister may: (a) determine the terms and conditions of appointment, including remuneration and allowances, of a person appointed to act as Chairman or Deputy Chairman; and (b) terminate the appointment at any time. (8) A person appointed to act as Chairman or Deputy Chairman may resign the appointment by writing signed by the person and delivered to the Minister. (9) Anything done by or in relation to a person purporting to act as Chairman or Deputy Chairman is not invalid because: (a) the occasion for the appointment had not arisen; (b) there was a defect or irregularity in connection with the appointment; (c) the appointment had ceased to have effect; or (d) the occasion for the person to act had not arisen or had ceased.
(1) Subject to this section, the Corporation shall meet at such times and places as the Chairman thinks necessary for the efficient conduct of the affairs of the Corporation. (2) The Chairman shall, upon the request in writing of not less than two members, convene a meeting of the Corporation. (3) The Minister may at any time convene a meeting of the Corporation. (4) The Chairman shall preside at all meetings of the Corporation at which he is present, and, in the absence of the Chairman, the Deputy Chairman, if he is present, shall preside. (5) In the absence of both the Chairman and the Deputy Chairman from a meeting, the members present shall appoint a member to preside at that meeting (6) At a meeting of the Corporation, three members constitute a quorum. (7) Questions arising at a meeting of the Corporation shall be decided by a majority of the votes of the members present and voting. (8) The member presiding at a meeting of the Corporation has a deliberative vote and, in the event of an equality of votes, also has a casting vote. (9) The Corporation shall keep a record of its proceedings.
(1) The Governor‑General may terminate the appointment of a member for misbehaviour or physical or mental incapacity. (2) If: (a) a member becomes bankrupt, applies to take the benefit of a law for the relief of bankrupt or insolvent debtors, compounds with his or her creditors or makes an assignment of his or her remuneration for their benefit; (b) a member, without reasonable excuse, contravenes section 21 of the Commonwealth Authorities and Companies Act 1997; (c) the Chairman or Deputy Chairman: (i) engages in paid employment outside the duties of his or her office without the approval of the Minister; or (ii) is absent from duty, except on leave of absence granted by the Minister, for 14 consecutive days or 28 days in any 12 months; or (d) a member (other than the Chairman or Deputy Chairman) is absent, except on leave of absence grante
This is an opening excerpt, not the complete document.