Everingham Solomons are pleased to announce that once again a Tamworth, Quirindi, Gunnedah or Manilla Year 12 student wishing to undertake university study in Law will have a valuable opportunity to receive the benefits of our Law Bursary.
The Sir Adrian Solomons Memorial Law Bursary provides financial assistance for the successful applicant during their first year of university as well as an opportunity to gain valuable paid work experience in our offices periodically throughout the duration of their studies.
All Principals of local High Schools have been contacted and advised of the details. Interested students should liaise with the Principal or Careers Advisor of their school, who will assist them in making a formal application for this Bursary.
We emphasise that the selection process does not depend solely on academic merit. We appreciate that students come from a variety of backgrounds and accordingly the selection process concentrates on the attributes of the student as a whole, rather than solely academic achievement.
The Bursary has gained widespread interest since its inception and continues to provide a valuable opportunity for current Year 12 students wishing to pursue a legal career. The Bursary is also open to students currently undertaking a gap year who will be commencing university study in 2015.
Everingham Solomons view the Bursary as a continuing commitment to young people in the communities of Tamworth, Quirindi, Manilla and Gunnedah and we encourage interested students to apply. Applications will be accepted until 30 September 2016.
Click here for more information on Terry Broomfield.
I was invited to meet with members of the New England Cancer Carers’ Group this week and present to them on some of the legal issues faced by those who find themselves caring for a loved one undergoing treatment for cancer or some other illness.
I was confronted during my research at how many legal issues carers face, mainly as volunteers as well. I felt it was important to reassure the carers that there are many good solicitors and accountants in our region who can assist to work through these issues.
The big ticket items are there – ensuring that their loved one has his or her affairs in order via a Will, an Enduring Power of Attorney, an Appointment of Enduring Guardian (with Advanced Care Directive) and through superannuation arrangements. But there is a fine line that carers must tread between assisting to put those arrangements in place and being perceived to be influencing the decisions being made. That perception may arise particularly where the carer has come along later in the ill person’s life and there are children from an earlier marriage. My advice to the carers was to make arrangements for a visit from the ill person’s solicitor but then step back from the process and allow the solicitor to manage the situation.
Farm and business succession struck me as a big issue too. Where a farm or business has been run by a person who suddenly becomes seriously ill, his or her carer may need to step into the breach and run the farm or business; and be the primary carer as well! Many farmers and business people work with their solicitors and accountants to prepare plans that deal with that eventuality but many do not as well. On top of everything else, it can be very stressful for the ill person, primary carer and the family to have to come together at that time to have the drawn out discussions required to put in place a viable farm or business succession plan.
We discussed a raft of other legal issues as well – the ill person and the carer needing flexible work arrangements from their employers; issues with claims against income protection, trauma, TPD and life insurance policies; workers compensation claims where the illness is work-related; privacy laws and access to medical records; medical negligence claims; issues with funeral arrangements; the executor’s role; and so on.
The solicitors at Everingham Solomons work with carers facing legal issues like those above to provide some peace of mind at a difficult time because Helping You is Our Business.
Click here for more information on Keiran Breckenridge
There is something inherently intriguing about placing numbers after words in a punchy turn of phrase where, in the absence of any context, they mean absolutely nothing.
The bemused reader can only wonder what marvels exist beyond the meaningless collaboration of symbols. It’s a government’s way of sparking interest in things that are, in reality, fairly mundane.
Mi6, Area 51 and Double-0-7 are great examples. They conjure images of deeply held national secrets, extraterrestrial technologies and sculpted men in dinner suits silently dispatching ultra-villains. All very snazzy stuff. Realistically, those types of institutions revolve around cubicle offices, stale drip coffee and endless data entry.
Division 7A of Income Tax Assessment Act 1936 is perhaps the Australian Government’s pièce de résistance. Interesting as it may sound, it’s the legislature’s way of restricting you from taking stuff out of your own company in a way that would allow you to shimmy past the tax man.
Broadly speaking, any time that a private company makes a payment, provides an asset, grants a loan or forgives a debt to a shareholder, the starting point is to say that the transaction is a Division 7A deemed dividend.
The effect of classifying the transaction as a dividend is that, instead of being a non-taxable gift or loan, the transaction becomes a taxable dividend. In essence, Division 7A stops your company giving you things, tax free.
There are however at least ten legislated exceptions to the general rule. Loans between a company and its shareholders can be excluded from the deemed dividends regime where the loans are documented, include a minimum interest rate and are repayable within certain timeframes.
Exceptions also exist where loans can be said to be made in the ordinary course of business and where loans are made between companies. The exceptions regime is complex and individual cases require specific analysis. Getting the documentation wrong can affect how much tax you pay.
Everingham Solomons has legal expertise in complex business matters. If you have a complex commercial problem, contact us because, Helping You is Our Business.
On 1 July 2016, certain Stamp Duties are to be abolished in New South Wales.
Firstly, mortgages executed on or after 1 July 2016 will not be liable to payment of Stamp Duty.
Further, any advances made on a pre-existing agreement after 1 July 2016 will not be subject to the imposition of Stamp Duty.
Secondly, Stamp Duty on a large number of business assets will also be abolished. Whilst this abolition has been promised for many years, it looks like this is the year where it will be removed.
The types of business assets which will cease to be subject to Stamp Duty include the goodwill of a business, a business’s intellectual property, statutory licences or permissions (for example, a taxi licence) and duty on gaming machine entitlements.
Stock in trade is already exempt from Stamp Duty.
There are some anti-avoidance measures. If an agreement was entered into prior to the 1 July which is subsequently replaced with an agreement after 1 July, then the transaction is still subject to payment of Stamp Duty.
Further, if a transaction has been entered into after 1 July 2016 as a result of an Option Agreement entered into prior to that date, then the Stamp Duty is still payable.
But wait there is more. As and from 1 July 2016 the government will also cease charging Stamp Duty on the Transfer of Shares in a New South Wales Company and on units in a Unit Trust Scheme registered in New South Wales.
Stamp Duty is best known as a tax which is paid by them when they purchase land and improvements.
Unfortunately, there appears to be no plans to abolish or reduce the rate of Stamp Duty payable on land transactions in New South Wales.
If you are planning to do a transaction involving a mortgage or purchase of a business or the transfer of shares or units in a trust, it may be advantageous to wait until after 1 July 2016.
If you have questions regarding Stamp Duty, we can at Everingham Solomons, provide the answers, because Helping You is Our Business.
Sometimes it suits employers to hire people for short, fixed periods of time. For example, there may be a specific project with a defined period that requires specialised staff.
A fixed-term contract is an employment agreement which will continue until an agreed date. The term is fixed and it is clearly defined as having a start date and a finish date inserted into the employment contract.
The benefits for an employer of a fixed-term contract is that the employer can conclude the employment relationship upon the expiry date without the need to give reason for termination. An employer that has employees on fixed-term contracts can just elect not to renew the contract.
In this scenario the employee upon reaching the expiry date and not having been offered a renewal is prevented from bringing an unfair dismissal claim or seeking other entitlements such as a notice period.
Issues arise in the event that an employer seeks to bring an early conclusion to the employment contract before the agreed expiry date. In these circumstances, the employer may need to payout the remaining term of the fixed-term contract which might be significant.
Naturally, fixed-term contracts must be genuine in the eyes of the law. An employee who is continually placed on rolling fixed-term contracts may be able to argue that they have had a reasonable continuing expectation that their employment was on an ongoing basis. In this scenario, upon the expiry of the fixed-term contract the employee would be able to bring a claim for unfair dismissal.
If an employer is considering retaining staff on a fixed term contract, it should do so only if there is a genuine expectation that the staff will only be required for a fixed period of time.
Problems can arise in respect of fixed-term employment contracts when employers fail to include termination clauses within the contract. In this scenario, an employer may be stuck with the employee for the fixed term without an ability to terminate the employee within the fixed term.
If an employer has identified a need for an employee for a fixed period of time, they should ensure that their fixed-term contract considers the following:
Appropriately drafted termination clause that allows the employer to dismiss an employee for misconduct or poor performance before the expiry of the term;
Where possible, limiting the term of the fixed term contract;
Making it clear that no notice need to be given to the employee on the expiry of the term of the contract, and their employment will end at that time and their contract will not be renewed.
If you are considering taking on staff for a fixed period of time to meet the needs of your business, Everingham Solomons can assist with drafting the appropriate fixed-term contracts needed, because Helping You is Our Business.
The requirement that before a property can be sold or leased, the owner or landlord must have an up-to-date swimming pool certificate of compliance, has been postponed more than once. New laws have now been introduced which allow sellers to pass on the obligation for swimming pool barrier compliance to buyers. For affected properties, the new laws will apply to any contract for sale signed on or after 29 April 2016.
The main changes that operate from 29 April 2016 include the following:
Contracts for sale of land with pools must attach one of the following:
a valid certificate of compliance;
an occupation certificate (for newly constructed swimming pools instead of a certificate of compliance); or
a certificate of non-compliance (if a pool barrier does not comply) EXCEPT FOR:
Strata and Community Schemes that comprise more than 2 lots, or an off the plan contract.
Failure to attach 1., 2. or 3. to the contract is an offence and may give a buyer the right to rescind the contract. If the contract is rescinded by a buyer, the seller must refund the deposit in full to the buyer.
Sellers are now able to transfer the obligation of obtaining a ‘certificate of compliance’ to the buyer by an appropriately drafted contract that attaches a ‘certificate of non-compliance’ to the contract.
The buyer of a property with a non-compliant swimming pool has 90 days from the date of settlement to address any issues of pool barrier non-compliance and obtain a certificate of compliance.
For sellers you need to make sure you are aware of your obligations when selling residential property. A real estate agent must not offer your residential property for sale unless a complete contract is prepared attaching all the prescribed documents and is available for inspection by prospective purchasers at the real estate agent’s registered office. Failure to do so is an offence and can result in the imposition of a penalty. For buyers you should make sure you get a copy of the notice that outlines the issues and rectification works needed before signing any contract that attaches a certificate of non-compliance so you can cost the work that needs to be done before you commit yourself to purchase.
At Everingham Solomons, we have the expertise to assist you with all of your legal matters including buying and selling property because Helping You is Our Business.
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On 20 April 2016 the Supreme Court of New South Wales gave its judgement in the matter of HIH Insurance Ltd.
The plaintiffs in the case were shareholders (‘the shareholders’) who acquired shares in HIH Insurance (‘the company’) between October 1998 and March 2001.
The shareholders contended and the company admitted that it published misleading financial statements in 1999 and 2000. The financial statements overstated HIH’s profits by $100m and HIH’s net assets by almost $200m (‘the misrepresentations’).
What was interesting about this case was that the shareholders never looked at the financial statements and never contended that the misrepresentations caused them to buy the shares. They agreed that they would have bought the shares anyway.
What the shareholders said was that the misrepresentations caused the shares’ market price to be higher at the time the shareholders bought them than it would have been but for the misrepresentations. The shareholders said that they should be compensated for the difference between the high price at which they bought the shares and the lower price that they would have been able to buy them if the market was not falsely inflated by the misrepresentations.
The company argued that the shareholders’ argument had no legal basis. The company submitted that it was necessary for the shareholders to prove that they relied on the misrepresentations in purchasing the shares, or, that the shareholders would have acted differently if it were not for the misrepresentations. The company said that there was no ‘causative bridge’ between the misrepresentations and the shareholders’ loss.
The judge sided with the shareholders. Expert evidence proved that between June 1999 and June 2000, the company’s shares traded between 6% and 13% higher than they would have done if it were not for the misrepresentations. The judge ordered the company to pay the plaintiffs damages to that extent.
The judge’s decision was a novel one and the company has appealed to the High Court.
If you need advice on any type of complex corporate or commercial matters, contact Everingham Solomons because Helping You is Our Business.
Clearly there is no way of determining how long you will live for. Nonetheless, in the matter of Fontana & Fontana [2016] FamCAFC11, the full court of the Family Court was asked to consider whether a husband’s potentially reduced life expectancy, caused the wife to receive an adjustment in her favour, thereby providing her with a greater share of the matrimonial pool of assets.
In property proceedings, adjustments in one party’s favour take into consideration not only financial and non-financial contributions made during the relationship, but also what are referred to as “section 75(2) factors”. For instance, the age, health and “future needs” of the parties to the marriage may be relevant factors.
The facts of Fontana & Fontana were as follows:
The matrimonial pool of assets was valued at $1.72 million, which comprised mainly real property and excluded superannuation assets;
The husband was 49 years of age and the wife was 43 years of age;
The parties were married for approximately 15 years;
There was one child, aged 15 at the time of the proceedings, who was in the care of the wife;
The husband suffered from diabetes and renal failure, and required dialysis three times per week, as well as being on a waiting list for a kidney transplant;
In respect of income, the wife had capacity to earn over $200,000 per annum and the husband received income protection insurance worth $150,000 per annum
At the trial, the court awarded the wife 56.4 % and the husband 43.6% of the net pool. The trial judge gave reasons for making an adjustment in the wife’s favour as follows:
“I am satisfied that the husband’s needs, whether he has a transplant or not, are likely to subsist for a shorter time than are the wife’s needs. With some regret, this is a matter that I must take into account in the wife’s favour.”
The husband appealed the division based on the trial judge’s adjustment made on his reduced life expectancy and his special needs, which the trial judge said would “subsist for a shorter time”.
On appeal, the full court determined that the trial judge was incorrect in giving weight to husband’s life expectancy in the circumstances that the judge had no ability to make a conclusive finding on the husband’s life expectancy.
The court found that a 4.5% adjustment in favour of the wife was made in error, and accordingly the property orders in the original trial were set aside.
At Everingham Solomons we have the expertise and experience to assist you with property matters because Helping You is Our Business.
A Will stipulates how a person’s property is to be distributed after their death.
Considerations:
Who do you want to be your executor, that is the person responsible for carrying out your wishes, obtaining probate (if required); and distributing your estate?
Who do you want to receive a share of your estate (the beneficiaries)?
How do you want to divide your estate (who gets what)?
A Power of Attorney appoints someone to act on your behalf with respect to financial and legal matters.
Considerations:
Who do you trust to be your attorney, how many attorneys do you want to appoint and how do you want to appoint your attorney/s?
Do you want your attorney to be able to use your money for someone else or for your sole benefit?
Do you want to impose any conditions or limitations? eg. your attorney can only act if you are physically or mentally incapacitated.
An Appointment of Enduring Guardian appoints someone to make medical and lifestyle decisions on your behalf once you have lost mental capacity and can no longer make decisions for yourself.
Considerations:
Who do want to appoint as your guardian, how many guardian/s do you want to appoint and how do you want to appoint your guardian/s?
Are you happy for your guardian to decide where you live, what health care you receive, and what personal services you receive, refuse medical treatment, turn off life support and not engage life sustaining measures?
Do you have any specific wishes regarding medical treatment or living arrangements?
At Everingham Solomons, we have the expertise and experience to assist you with making or updating your Will, Power of Attorney and Appointment of Enduring Guardian because Helping You is Our Business.
News reports occasionally contain stories about individuals with influence in tendering processes who receive “kickbacks” for giving favourable treatment to certain tenderers. This can sometimes take the form of a tendering party receiving an invoice for “consulting services” of some type from a company associated in some way with the individual with influence in the tendering process. The invoice is paid and accounted for in the tenderer’s books, which then receives favourable treatment in the tender. The funds are then moved from the invoicing company in some way into the pocket of the individual with influence. On the surface, the payment can look legitimate but a bribe has been concealed.
In Australia, it often takes investigatory work of an anti-corruption watchdog to expose such activity. Political pressure then increases for prosecuting bodies to eradicate such practices and punish the offenders.
The Federal Parliament has recently made that task easier by enacting the Crimes Legislation Amendment (Proceeds of Crime and Other Measures) Act 2016. While mainly directed at the bribery of foreign public officials, the Act also has broad application domestically. The Federal Criminal Code has been amended to prohibit a company or an individual making, altering, destroying or concealing an accounting document:
with the intention to facilitate, conceal or disguise the giving or receipt of a payment not legitimately due to a person; or
reckless to the fact that doing so will have that effect.
Intentional individual offenders face 10 years imprisonment and/or a fine of $1.8 million. Recklessness can lead to five years imprisonment and/or a $900,000 fine. Intentional corporate offenders face fines the greater of $18 million, three times the value of the benefit gained or 10 percent of the corporation’s annual turnover if the value of the benefit cannot be determined. The fines are half for reckless corporate offenders.
Companies (and their directors) that do not review systems and cultures in their organisations that could allow such behaviour to occur may find themselves investigated and prosecuted on the basis of recklessness alongside the actual perpetrators of the bribery.
At Everingham Solomons, we advise and assist businesses to comply with their ever-increasing legal obligations because Helping You is Our Business.
Click here for more information on Keiran Breckenridge
Everingham Solomons are pleased to announce that once again a Tamworth, Quirindi, Gunnedah or Manilla Year 12 student wishing to undertake university study in Law will have a valuable opportunity to receive the benefits of our Law Bursary.
