Section 29.(1) Where subsidy in relation to an advance to a person ceases to be payable under section 26, 27 or 27A, for a reason referred to in:
the Secretary may, by notice in writing given to the person, require the person to pay to the Commonwealth the amount specified in the notice in the manner, and within the period, specified in the notice.
(2) The Secretary may specify in a notice an amount equal to:
(a) where paragraph 26(1)(a) or (b) or paragraph 27(1)(a) or (b) applied—the whole of the amount of subsidy paid in respect of the person; or
(b) where paragraph 26(1)(c) or 27(1)(c) applied—the whole of the amount of subsidy paid in respect of the person since the day when the use referred to in that paragraph happened; or
(c) where subsection 26(2) applied—the whole of the amount of subsidy paid in respect of the person since the day when the person agreed or arranged to transfer the relevant land, or land and dwelling-house; or
(ca) where subparagraph 26(2B)(b)(i) applied - the whole of the amount of subsidy paid in respect of the person since the day when the assignor agreed to transfer the right of residence in the retirement village, or gave up the right of residence in the retirement village; or
(cb) where subparagraph 26(2B)(b)(ii) applied - the whole of the amount of subsidy paid in respect of the person since the day on which the assignee agreed to transfer the interest in the retirement village, or terminated the assignor's right of residence in the retirement village; or
(d) where subsection 26(7) applied—the whole of the amount of subsidy paid in respect of the person since the day on which the person's right of residence was terminated and the person has ceased to reside in the retirement village accommodation;
(e)where subsection 27A(1) or (2) applied - the whole of the amount of subsidy paid in respect of the person since the day on which the cancellation of subsidy took effect;
or such part of that amount of subsidy as the Secretary determines to be reasonable.
(3) The Secretary shall cause a copy of a notice under this section to be given:
(a) to the Bank; and
(b) if subsection 26(2B) applied - to the assignor.
(4) Subject to this section, where a person fails to comply with a notice, the amount specified in the notice may be recovered from the person in a court of competent jurisdiction as a debt due to the Commonwealth.
(5) Where:
(a) the Bank sells any property of a person by way of enforcing:
(i) a specified portfolio asset; or
(ii) a mortgage securing a subsidised advance; or
(iii) in the case of a right of residence in a retirement village—any other security that the Bank has in relation to that advance; and
(b) `the Secretary has given the person a notice under this section;
the Bank shall pay to the Commonwealth an amount equal to:
(c)the part of the proceeds of the sale that, but for this subsection, would have been payable by the Bank to the person; or
(d)such part of the amount specified in the notice as remains unpaid; whichever is less.
(6) A payment by the Bank to the Commonwealth under subsection (5) is, to the extent of the payment, a discharge of the liability of the person referred to in that subsection to the Commonwealth and of any liability of the Bank to the person under the specified portfolio asset, mortgage or other security.
Section 30. (1) The Secretary may, on behalf of the Commonwealth, by instrument in writing:
(a) write off an amount that a person has been required to pay to the Commonwealth under section 29;
(b)waive the right of the Commonwealth to recover from a person the whole or part of an amount that the person has been required to pay to the Commonwealth under that section; or
(c) allow a person who has been required to pay an amount to the Commonwealth under section 29 to pay that amount by such instalments as are specified in the instrument.
(2) A decision under subsection (l) takes effect:
(a) on the day specified in the notice, being the day on which the decision is made or any day before or after that day; or
(b) if no day is so specified—on the day on which the decision is made.
11.15Termination/Suspension of Subsidy Payments and Recovery of Subsidy from Borrower
Notwithstanding the provisions of any other Clause in this Agreement, the Commonwealth may elect to recover from the Borrower in the manner provided for under the Amended Act or may terminate and/or suspend future Subsidy payments in respect of the following:
(a) a Borrower who, having obtained a Subsidised Advance pursuant to the Amended Act, a Portfolio Contract of Sale or a Corporation Advance under a Specified Portfolio Asset,
(i) is discovered to have made a false statement in order to obtain a Certificate of Entitlement, a Portfolio Contract of Sale or a Corporation Advance;
(ii) is discovered not to have been entitled to a Certificate of Entitlement, a Portfolio Contract of Sale or a Specified Portfolio Asset at the time when the Certificate of Entitlement was issued to the Borrower or the Corporation Advance secured by the Specified Portfolio Asset was received by the Borrower or the Portfolio Contract of Sale was executed by the Borrower;
(iii) purports to transfer a holding without a Certificate of Entitlement having been issued which provides for Commonwealth consent to the Transfer of Land and Subsidy to the proposed transferee;
(iv) is discovered to have used the Subsidised Advance or Corporation Advance for a purpose other than that for which it was made;
(v) is a transferee of a holding in respect of which the Commonwealth has issued a Certificate of Entitlement consenting to a Transfer of Land and Subsidy and has without reasonable excuse failed to comply with an undertaking given by that transferee under Sub-section 22(2) of the Amended Act; or
(vi) becomes the husband or wife of another Borrower,
(vii) 8 — is discovered to have sold a 'holding' or 'retirement village accommodation' to which subsidy relates and has not acquired another 'holding' or 'retirement village accommodation' as a substituted security within six months in accordance with Sub-clause 11.2A.
(b) where the Bank takes action to enforce a Portfolio Contract of Sale or a security for which the Subsidised Advance or a Corporation Advance was provided and the Bank has not within three (3) months sold the property and discharged the loan outstanding to it thereon; or
(c)where an assignor has agreed to transfer a right of residence in a Retirement Village, or has given up a right of residence in a Retirement Village; or
(d) where the assignee has agreed to transfer all or part of his or her interest in a Retirement Village, or has terminated the assignor's right of residence in a Retirement Village.
12.5 Recovery of Subsidy
Where the Bank fails to notify the Commonwealth of the circumstances referred to in Sub-clause 10.1 or 12.4 and such failure to notify results in payments of Subsidy which would not otherwise have occurred then the Commonwealth shall be entitled to recover from the Bank, the Borrower or the Entitled Applicant as it deems appropriate immediately as a debt all Subsidy payments that the Commonwealth has incurred and/or paid as a result of the Bank's failure to so notify.
12.5.1 The Commonwealth shall be entitled to recover as from the last date that notification should have been given by the Bank.
Subsidy is recovered from the recipient of the DSH advance, except where the Bank enforces its mortgage (see below).
Recovery of subsidy should be attempted in all cases where it is legally enforceable and warranted in the circumstances.
Delegates must remember that recovery of subsidy is a discretionary provision of the legislation, and any decision to recover should take account of the circumstances, financial and otherwise, of the person(s) involved.
Subsidy can only be recovered if it is being paid on behalf of a borrower at the time the notice to recover is issued and if a notice of cancellation has also been issued.
Subsidy is recovered from the Bank where the Bank's power of sale as mortgagee is enforced (normally as a result of a default in repayment of the loan by the borrower). In this case subsidy will continue to be paid until the loan has been discharged or for three months, whichever is the earlier. The amount to be recovered will be paid by the Bank from the proceeds of the sale of the property.
The delegate may decide to recover the subsidy paid by way of instalments. The amount of these instalments is to be specified in writing to the borrower. This decision should be made having regard to the financial circumstances of the borrower and the amount to be recovered.
If it becomes uneconomic to recover the subsidy, either in whole or in part, the delegate may decide to waive payment of the subsidy or to write off the amount payable.
Cancellation and recovery of subsidy does not in itself alter the eligibility status of an eligible person nor affect that person's right to apply for a further subsidised advance under the portability provisions.
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