WADC and WA Exim Corporation Repeal Act 1998

Commencement day means the day the Act receives Royal Assent (section 3). For this Act, that was 30 June 1998. All vesting and substitution provisions operate from that moment, unless the context otherwise requires.

Property is defined exhaustively but expansively: “property and assets of every description, and includes securities, rights and powers of every description” (section 3). This captures not only physical assets but choses in action, contractual rights, intellectual property, and any other intangible interests.

Liability is defined to cover “any liability, duty or obligation”, whether actual, contingent, prospective, liquidated or unliquidated, and whether owed alone or jointly and severally (section 3). This is a very broad concept. It means the State inherits not only current debts but also obligations that may arise in the future from past events, potentially including tort claims, contract warranties, and statutory penalties.

WADC means the Western Australian Development Corporation established by the 1983 Act and includes any wholly owned subsidiary determined under the Corporations Law. Exim means the Western Australian Exim Corporation established by the 1986 Act and likewise includes its wholly owned subsidiaries. The definitions ensure that the repeal reaches not only the parent statutory corporations but also any companies they controlled.

Vesting is the mechanism by which property, claims, rights, and remedies automatically transfer to the State without the need for further conveyances (Schedule 1 clause 2). The State simultaneously becomes liable for all the corporations’ obligations.

Substitution in agreements and instruments is automatic under clause 6. Any contract or document still in force immediately before commencement day is deemed to have the State as party instead of the former corporation, and any reference to the corporation or its trading name is read as a reference to the State. This avoids the need for formal novation but may surprise counterparties who did not anticipate dealing with the State.

Cancellation of shares under clause 5 extinguishes all rights attached to the shares issued to the Treasurer under the original Acts. Because the shares were held by the State itself (through the Treasurer), this cancellation does not deprive a private party of property. But it formalises the end of the corporations’ equity capital structures.

Limited continuation for reporting under clause 8 keeps the WADC and Exim in existence only for the purpose of preparing a part-year financial report under the Financial Administration and Audit Act 1985. The boards are replaced by a single ministerial appointee who holds office at the Minister’s pleasure and has only the powers necessary for that reporting function.

Consequential amendments are set out in Schedule 2. They remove references to the WADC and Exim from the Constitution Acts Amendment Act 1899, the Financial Administration and Audit Act 1985, the Government Employees Superannuation Act 1987, and the Statutory Corporations (Liability of Directors) Act 1996. These deletions reflect that the corporations no longer exist and their directors are no longer subject to the specific liability regime.

The Act directly affects the State Government of Western Australia, particularly the Treasurer and the Minister responsible for the corporations. The Treasurer assumes broad powers and obligations: to take delivery of all records (clause 3), to dispose of property and compromise liabilities (clause 4), and to arrange clerical assistance for the reporting process (clause 8(7)). Creditors and counterparties of WADC and Exim are affected because their contractual counterparty changes automatically to the State, and their rights to enforce obligations now run against the State rather than a statutory corporation. This may have implications for sovereign immunity, choice of law, and enforcement mechanisms. Creditors with contingent or unliquidated claims now have the State as debtor, which may affect the practical recoverability of those claims if the State disputes them.

Employees and former employees of WADC and Exim are affected. The Act does not expressly transfer employees to the State or any other entity. While the State assumes liabilities, ongoing employment obligations may fall within that term. However, the Act creates no specific machinery for the continuation of employment contracts beyond the general substitution under clause 6, which applies to “agreement or instrument”. The part-year reporting provision (clause 8) implies that some staff may be retained temporarily to complete the financial statements, but their ongoing employment status is not addressed. The boards of directors cease to hold office immediately (clause 8(5)(a)). Those directors are not compensated for loss of office under the Act, and their statutory liability under the Statutory Corporations (Liability of Directors) Act 1996 is removed by the consequential amendment in Schedule 2, but only for future periods.

The Western Australian Land Authority is affected indirectly by section 6, which preserves its status as successor to certain WADC property under section 51 of the Western Australian Land Authority Act 1992. The Act does not disturb that earlier succession. Entities that were wholly owned subsidiaries of WADC or Exim are included within the definitions of those corporations, so their property and liabilities also vest in the State, and their agreements are similarly substituted.

Taxpayers are affected in the sense that the State’s assumption of all liabilities, including contingent and prospective ones, means any future payouts required to discharge those obligations will come from the Consolidated Fund and ultimately from general revenue. There is no provision for ring-fencing or separate accounting for the assumed liabilities, so they become part of the State’s general fiscal obligations. The Act also removes the corporations from the list of statutory authorities subject to audit under the Financial Administration and Audit Act 1985, which reduces the scope of public scrutiny of those entities’ historical financial affairs, although the part-year report requirement provides some limited transparency.

The Treasurer’s primary right under the Act is the power to get in, sell, or otherwise dispose of any beneficial estate or interest in property vested in the State, and to do “anything that is necessary or convenient” for paying or discharging any liability or arranging for its composition or compromise (Schedule 1 clause 4). This power is exercisable “as the Treasurer thinks fit”, with no express requirement for independent valuation, competitive bidding, Ministerial approval, or parliamentary oversight. The only financial discipline is that proceeds must be paid into the Consolidated Fund (clause 4(2)). The Treasurer also has the duty to take delivery of all records of the corporations (clause 3) and to arrange clerical assistance for the reporting process (clause 8(7)). The moneys required to defray costs and expenses of exercising those powers are charged to the Consolidated Fund and appropriated accordingly (clause 4(4)), so the Treasurer does not bear any personal financial risk.

The State has the right to be substituted as a party to all subsisting agreements and instruments that named WADC or Exim, and to have all references to those corporations or their trading names read as references to the State (clause 6). This substitution is automatic and does not require the consent of the other contracting party. The State also has the right to have legal proceedings that could have been brought by or against the corporations now brought by or against the State, and to continue or discontinue proceedings that were already underway (clause 7).

Counterparties and creditors have the right to enforce their claims against the State as the successor entity. The Act does not limit or alter the substantive terms of the contracts or liabilities; it merely changes the obligor. Creditors with contingent or prospective claims can still enforce them if and when they crystallise. However, the Act does not provide any specific right to be notified of the substitution or to object to it. It also does not create any right to challenge the Treasurer’s decisions on disposal of property or compromise of liabilities, except through general administrative law remedies.

Former directors and the boards have no ongoing rights under the Act. Their offices cease on commencement day (clause 8(5)(a)). The accountable authority under the Financial Administration and Audit Act 1985 (which is the board or designated officer) has a duty to prepare a part-year report for the period from the preceding 1 July to the commencement day (clause 8(1), (3)). The corporations and their accountable authorities continue in existence solely for that purpose (clause 8(2), (4)). The Minister has the right to appoint a person to constitute the board for reporting purposes, with the powers necessary for that function, and that person holds office at the Minister’s pleasure (clause 8(5), (6)). The Treasurer must arrange clerical assistance for the reporting function (clause 8(7)).

The Act itself creates no express criminal penalties, civil penalties, or enforcement mechanisms. It is a purely administrative and procedural statute. The enforcement of its provisions relies on general public law remedies such as administrative review or judicial review of the Treasurer’s decisions, if any party has standing to challenge them. The broad discretion given to the Treasurer (“as the Treasurer thinks fit”) makes successful challenge difficult, absent an error of law or bad faith. The Act also does not provide for any audit or independent oversight of the Treasurer’s actions beyond the ordinary operation of the Financial Administration and Audit Act 1985, which applies to the State’s general financial management but not specifically to the winding-up process.

The consequential amendments in Schedule 2 remove WADC and Exim from the Statutory Corporations (Liability of Directors) Act 1996. That Act had imposed personal liability on directors of statutory corporations for certain debts. After the repeal, former directors are no longer subject to that regime for future conduct, but the amendment does not retrospectively remove any liability that had already accrued before commencement day. The Act does not specify what happens to any pending investigations or claims against former directors under that Act.

The part-year reporting requirement under clause 8 is subject to Division 14 of Part II of the Financial Administration and Audit Act 1985, which imposes duties on accountable authorities to prepare proper accounts and reports. Failure to comply with those duties could lead to penalties under that Act, but such penalties are not created by this Act itself. The Act also does not provide for any consequence if the Treasurer fails to take delivery of records or fails to arrange clerical assistance. Those provisions appear directory but unenforceable in any direct way.

Because the Act vests all liabilities in the State, creditors can enforce their rights against the State through ordinary civil proceedings. The State cannot rely on the repeal of the corporations as a defence; clause 7 ensures that proceedings can be commenced or continued against the State as if it were the corporation. However, the Act does not create any special expedited procedure or override any sovereign immunity that the State may otherwise have. The practical remedies available to creditors are the same as those available against any government entity.

Section 6 expressly provides that the Act has effect subject to section 51 of the Western Australian Land Authority Act 1992. Section 51 of that Act already transferred certain property, liabilities, and other matters from WADC to the Western Australian Land Authority. The current Act does not override that earlier transfer; instead, clauses 2, 3, 6, and 7 of Schedule 1 are made subject to section 6, meaning the automatic vesting and substitution provisions do not affect property or agreements that had already been transferred to the Land Authority. This prevents double vesting and potential conflict between the two succession regimes.

Section 7 provides that the Interpretation Act 1984 applies as a supplementary source of transitional rules. The Interpretation Act 1984 contains general savings provisions for the effect of repeals, including the preservation of existing rights, obligations, and proceedings, and the continuation of subordinate legislation. However, section 7 says this Act is “supplementary to, and does not displace” the Interpretation Act. Where the Schedule 1 provisions are silent, the Interpretation Act’s default rules will fill the gap. Where Schedule 1 is specific, it prevails because a later specific Act overrides a general default provision.

The consequential amendments in Schedule 2 affect several other Acts. The Constitution Acts Amendment Act 1899 is amended by deleting references to the Board of Directors of WADC and the Western Australian Overseas Projects Authority (which was related to Exim). This removes those offices from the list of statutory offices requiring parliamentary approval for appointment. The Financial Administration and Audit Act 1985 is amended by deleting WADC and Exim from the list of statutory authorities in Schedule 1. As a result, those entities are no longer subject to the audit and financial reporting requirements of that Act, except for the transitional part-year report required by clause 8. The Government Employees Superannuation Act 1987 is amended by deleting “Western Australian Development Corporation (on and from 31 March 1991)” from Part B of Schedule 1. This removes the corporation’s specific superannuation coverage under that Act, which may affect superannuation entitlements for employees who were covered. However, because the Act does not expressly address employee transfers, the practical effect is unclear. The Statutory Corporations (Liability of Directors) Act 1996 is amended by deleting the reference to WADC, meaning that directors of that corporation are no longer within that Act’s scope for future periods.

The Act also interacts with the Corporations Law, because the definitions of WADC and Exim include wholly owned subsidiaries determined under the Corporations Law. The vesting and substitution provisions apply to those subsidiaries as part of the corporations. This potentially affects private companies that were wholly owned by the statutory corporations, transferring their ownership to the State and substituting the State in their contracts.

The Act has a remarkably simple history. It was enacted as Act No. 30 of 1998, received Royal Assent on 30 June 1998, and came into operation on that same day by virtue of section 2. The compilation table in the Notes shows that there has been no subsequent amendment to this Act. The Act has not been amended by any later Western Australian legislation. It remains in its original form as enacted. This is consistent with its nature as a one-off winding-up statute: once the repeals and transfers were effected, there was no ongoing operation that required amendment. The absence of amendments also means that the transitional provisions have never been adjusted to address any practical difficulties that may have arisen during the winding-up. The Act does not contain a sunset clause or a review provision, so it technically remains on the statute book with ongoing legal effect for matters such as the continuing liability of the State for any residual contingent obligations that may still arise.

The Act’s long title lists its three purposes: repeal of the two enabling Acts, transitional provisions, and consequential amendments. No amendment has altered or expanded that scope. The text of the Act as originally assented is identical to the compilation in force today. This is unusual for many transitional statutes, which often require later amendments to fix drafting errors or to extend time limits. The fact that no amendments have been needed suggests either that the winding-up was straightforward, or that any issues were resolved administratively without legislative change. The Act does not provide for any ongoing reporting or sunset of the Treasurer’s powers, meaning those powers (such as the power to sell property or compound liabilities under clause 4) theoretically continue indefinitely until the Treasurer has dealt with all remaining assets and liabilities.

The source provided does not record any litigation under this Act. The Notes and compilation table contain no references to court decisions, and the Act itself does not refer to any legal proceedings that have been commenced or resolved in connection with its provisions. This absence of litigation may be notable. A winding-up statute that vests property in the State and substitutes the State for a statutory corporation in contracts and proceedings could have given rise to disputes over the scope of liabilities, the enforceability of the automatic substitution, or the Treasurer’s exercise of powers to dispose of property. The fact that no reported cases are cited suggests that either the transition proceeded smoothly, or that any disputes were resolved without litigation or outside the public record.

Nevertheless, the Act’s broad definitions of “liability” (including contingent and prospective) and “property” (including all rights and powers) could have been fertile ground for litigation had a creditor sought to argue that a particular obligation was not a liability because it was not “properly payable”, or that a particular asset was not property because it was held on trust. The clause 1 of Schedule 1 states that clauses 2, 3, 6, and 7 are subject to section 6 (the Land Authority carve-out), which could have led to disputes about which assets were already transferred. There is also no definition of “properly payable” in clause 2(b), leaving room for argument about whether a particular debt was properly incurred or was, for example, the result of an unauthorised transaction.

The Act also creates no mechanism for the State to disclaim onerous property or to repudiate contracts, unlike the equivalent provisions in the Commonwealth Statutory Corporations (Liability of Directors) Act 1996 or winding-up provisions in the Corporations Act 2001. That lack could have led to litigation if the State found itself bound by contracts it did not wish to perform. The absence of reported litigation may indicate that the State simply performed or settled all outstanding obligations without controversy. Alternatively, it may reflect that the Act’s provisions are sufficiently clear and comprehensive that courts have not been needed to interpret them. For the purposes of a deep dive, the key point is that the source gives no indication of any litigation history, and we cannot infer any.

The first major trap is the breadth of the “liability” definition. It includes contingent, prospective, unliquidated, and jointly held obligations. The State may have inherited liabilities that were not known or quantified at the time of repeal. For example, if WADC had guaranteed loans that were performing at the time, the State remains liable if the borrower later defaults, even decades after the repeal. There is no sunset period for these contingent liabilities.

Second, the Treasurer’s power to dispose of property “as the Treasurer thinks fit” under clause 4 carries no requirement for competitive tender, independent valuation, or Ministerial or parliamentary approval. This creates a risk that property could be sold at an undervalue, or that conflicts of interest could arise. A counterparty purchasing from the Treasurer cannot be sure that a better offer was not available, and there is no statutory mechanism for challenging the price.

Third, the automatic substitution in agreements under clause 6 operates regardless of the consent of the other party. This may be surprising to a counterparty who had a contract with a specific statutory corporation, perhaps with a set-off clause or a governing law provision that assumed the counterparty was a corporation rather than the Crown. The Act does not provide for notification of the substitution, so a counterparty may inadvertently continue to invoice the defunct corporation and be unpaid.

Fourth, the boards of directors cease to hold office immediately (clause 8(5)(a)), but the corporations continue in existence solely for reporting purposes, with a single ministerial appointee. This means there is no board to make decisions about remaining assets or liabilities during the transitional period. All such decisions fall to the Treasurer. This could cause delays if the reporting process takes time.

Fifth, the Act does not address employee transfer. Although the State assumes liabilities, it is not clear whether employees are deemed to become public servants of the State or whether their employment contracts are terminated. The absence of a clear transfer of employment provision could create uncertainty about accrued entitlements, leave, and superannuation, and may expose the State to industrial claims.

Sixth, the cancellation of shares under clause 5 extinguishes all rights attached to them, but the Act does not provide for any distribution of residual surplus to the shareholder (the Treasurer). While the Treasurer already holds the shares, the equity accounting treatment of the corporations is lost. Any surplus that would have been distributable on a winding-up under the Corporations Act 2001 is simply subsumed into the Consolidated Fund without any capital return.

Seventh, the Act does not provide for the registration of the vesting of property. For land and other assets that require registration, the Act may not be sufficient to perfect title. The absence of a provision that the Act operates as a statutory transfer instrument could cause conveyancing problems later.

Eighth, clause 6(2) extends the substitution to any agreement to which Exim was deemed a party under section 41(17) of the repealed Exim Act. That is a potentially wide net, capturing contracts deemed to be made with Exim even if not physically executed by the corporation. Identifying those contracts could be difficult.

Ninth, the part-year reporting requirement under clause 8 only requires reporting up to the commencement day. There is no ongoing reporting obligation for the period after commencement, so the public may not learn how the Treasurer disposed of assets or discharged liabilities. The Treasurer’s actions are shielded from the ordinary audit cycle that applied to the corporations.

Tenth, there is no provision for the State to disclaim onerous property or contracts. Unlike commercial winding-ups, the State must accept all assets and liabilities without any ability to repudiate. This exposes the State to potential liabilities from contaminated land, litigation, or unprofitable contracts.

For a party that was a counterparty to a contract with WADC or Exim immediately before 30 June 1998, compliance is largely passive. The Act automatically substitutes the State for the corporation. The counterparty should update its internal records to reflect that the contracting party is now “the State of Western Australia” rather than the former corporation. Invoices should be addressed accordingly, and correspondence should refer to the State. There is no need to renegotiate or re-sign contracts. However, the counterparty should verify that the contract has indeed been substituted and that the State is aware of its obligations. If the counterparty has ongoing billing or performance obligations, it should ensure that the relevant government department or the Treasury is contacted to confirm the responsible officer.

For creditors with claims against either corporation, the claim is now against the State. If a debt was due but unpaid at the commencement day, the creditor should lodge a claim with the Treasurer’s office. Given the broad definition of “liability”, even contingent claims (e.g., warranties that have not yet been breached) are enforceable against the State when they arise. Creditors should keep records of the original contract and any correspondence showing the liability arose before the repeal.

For the Treasurer and the responsible government department, compliance involves several affirmative steps. First, under clause 3, the Treasurer must take delivery of all records of the corporations on the commencement day. This means physically or electronically seizing custody of registers, papers, documents, minutes, books of account, and other records. Second, under clause 8, the accountable authority (for WADC and Exim separately) must prepare a part-year annual report covering the period from the preceding 1 July to 30 June 1998. Because the boards ceased to exist, the Minister must appoint a person to constitute the board solely for that reporting purpose. That person must have the requisite powers and be given clerical assistance. The report must comply with Division 14 of Part II of the Financial Administration and Audit Act 1985, which sets out content and timing requirements. Third, the Treasurer may decide to dispose of property or compromise liabilities under clause 4. While the Treasurer has broad discretion, best practice would involve maintaining records of all disposals and compromises, obtaining valuations where practical, and ensuring that proceeds are paid into the Consolidated Fund. Fourth, the Treasurer should identify any property or liabilities that are carved out by section 6 (the Western Australian Land Authority transfer) and ensure no double counting or double vesting occurs. Fifth, the Treasurer should arrange for any necessary conveyances or registrations to perfect title to vested land or other registrable assets, despite the Act’s automatic vesting. Sixth, to the extent that employees of the former corporations are retained to assist with the reporting or disposal, their employment status should be clarified in writing, and any superannuation or leave entitlements should be addressed, possibly under the Government Employees Superannuation Act 1987 as amended.

For former directors and officers, compliance is minimal after the boards cease. However, they should cooperate with the appointed reporting person by providing access to records and information. They should also be aware that the amendment to the Statutory Corporations (Liability of Directors) Act 1996 removes their future liability under that Act, but does not affect any liability that may have accrued before the repeal.

For the Minister, the key compliance step is to appoint a person under clause 8(5)(b) to constitute each board for the sole purpose of the part-year report. That person should be given clear terms and conditions, including any necessary indemnities for actions taken in that capacity.