The position of a trustee of a trust is an important position which is governed by State and Commonwealth Legislation and Case Law.
Trustees of a family trust have many duties. Broadly speaking, these include the trustee:
• Acting in good faith;
• Acting personally;
• Acting unanimously where multiple trustees are involved;
• Not being dictated to by others such as beneficiaries;
• Having a duty to consider how distributions should be made and to whom; and
• Having a duty to avoid fettering of any discretion they have.
So can a trustee appoint someone else to perform the trustee’s duties, like an attorney? It is not uncommon to see where a Trustee has executed a power of attorney in favour of third party.
The law is that a trustee cannot delegate these duties unless permitted by the Trust Deed, legislation or a Court Order.
The office of trustee is viewed by the Courts as one of trust and personal confidence.
A trustee must not execute a Power of Attorney to a third party granting the attorney, general or wide powers relating to the authority of the trustee. A trustee who does this will be acting outside the scope of the trust and the law and any transaction entered into utilising such Power of Attorney is likely to be unenforceable.
Section 10 of the NSW Powers of Attorney Act states that a prescribed Power of Attorney does not confer authority to exercise any function as a trustee.
Accordingly, a trustee cannot delegate their powers and authorities.
There is a statutory exception with respect to trustees of a self-managed super fund.
Trusts, trust deeds, trustee duties and the law surrounding them are complex.
At Everingham Solomons, we have the expertise to assist you because Helping You is Our Business.
When making a Will you need to be aware of special rules that apply to gifts to non-resident beneficiaries. These rules can even apply to gifts to Australian citizens who have lived overseas for a long period.
The general rule is that the beneficiary is taken to have acquired the assets on the day the testator died, and any capital gain or loss relating to a Capital Gain Tax (CGT) asset owned by the deceased is disregarded. That means-
• no CGT is payable from the estate
• no CGT is potentially payable by the beneficiary until he or she actually sells it; and
• the beneficiary will usually have access to a range of CGT concessions when he or she actually sells.
If however the beneficiary is a non-resident for tax purposes the outcomes can be very different. Potentially CGT can be payable as an estate expense which-
• brings forward the CGT cost; and
• corrupts the intended balance between beneficiaries as because it is payable as an expense of the estate, the cost will be borne by all beneficiaries, not just the non-resident.
Also, when the asset is ultimately sold by the non-resident, he or she may also not have access to the usual CGT concessions.
The potential tax costs to the estate are avoided if the relevant asset comes within the definition of “taxable Australian property” contained in the tax law. Broadly this refers to direct and indirect interests in Australian real property but even then the beneficiary may not get access to the usual CGT concessions when he or she sells.
From an estate planning viewpoint, the key points are –
• recognise the issue at the planning stage. Generally it will be too late to deal with the issue after death;
• where possible, avoid the issue arising by being selective in the type of gifts made to non residents e.g. cash rather than property; but
• If a tax cost is unavoidable, make sure it is borne by the appropriate party.
Many Wills involve complex and unexpected issues. At Everingham Solomons we have experts that can assist you to plan what happens to your estate or review what you have in place because helping you is our business.
When making a Will you need to be aware of special rules that apply to gifts to non-resident beneficiaries. These rules can even apply to gifts to Australian citizens who have lived overseas for a long period.
The general rule is that the beneficiary is taken to have acquired the assets on the day the testator died, and any capital gain or loss relating to a Capital Gain Tax (CGT) asset owned by the deceased is disregarded. That means-
• no CGT is payable from the estate
• no CGT is potentially payable by the beneficiary until he or she actually sells it; and
• the beneficiary will usually have access to a range of CGT concessions when he or she actually sells.
If however the beneficiary is a non-resident for tax purposes the outcomes can be very different. Potentially CGT can be payable as an estate expense which-
• brings forward the CGT cost; and
• corrupts the intended balance between beneficiaries as because it is payable as an expense of the estate, the cost will be borne by all beneficiaries, not just the non-resident.
Also, when the asset is ultimately sold by the non-resident, he or she may also not have access to the usual CGT concessions.
The potential tax costs to the estate are avoided if the relevant asset comes within the definition of “taxable Australian property” contained in the tax law. Broadly this refers to direct and indirect interests in Australian real property but even then the beneficiary may not get access to the usual CGT concessions when he or she sells.
From an estate planning viewpoint, the key points are –
• recognise the issue at the planning stage. Generally it will be too late to deal with the issue after death;
• where possible, avoid the issue arising by being selective in the type of gifts made to non residents e.g. cash rather than property; but
• If a tax cost is unavoidable, make sure it is borne by the appropriate party.
Many Wills involve complex and unexpected issues. At Everingham Solomons we have experts that can assist you to plan what happens to your estate or review what you have in place because Helping You is Our Business.
There are strict rules that apply when a Landlord wants to bring a residential tenancy to an end.
A termination notice must be provided to the tenant. This notice must be in writing, addressed to the tenant, signed and dated by you or your managing agent, provide the date the tenancy is to be terminated and the tenant needs to vacate and in some circumstances provide the reason for the notice.
In some circumstances there is no minimum notice period for the tenant – for example if the tenant dies, the property becomes uninhabitable or is destroyed, is being compulsorily acquired (for example by Council) or is not legally usable as a residence.
In most circumstances minimum notice periods apply to terminate a tenancy, depending on the situation:
If the fixed term has expired and the tenant has continued on – 90 days
If the property has been sold as vacant possession, and the fixed term has expired – 30 days
If the fixed term is coming to an end – 30 days
If the tenant has breached the tenancy agreement or is more than 14 days in rent arrears – 14 days
It is important to note that once a tenant has been given notice they can move out at any time without giving you notice. The tenant will only need to pay rent until they vacate the property, unless they are still under a fixed term agreement whereby they will need to pay rent until the end of the fixed term.
A second notice on different grounds may be given to a tenant if necessary, for example if the tenant has been given notice to end the fixed term but then doesn’t continue to pay rent.
Different rules apply for Commercial, Industrial and Retail leases.
Confused about your rights as a Landlord? Contact the team at Everingham Solomons because Helping You is Our Business.
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 has long provided 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.
Everingham Solomons will also be making a cash donation to the school of the successful applicant to assist in maintaining the excellent educational standards that our region can offer.
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 2020.
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 10 January 2020.
Click here for more information on Libby Campbell.
If your business need skilled workers that are in short supply, a good option for your business is to employ skilled migrants who are already in Australia on a skilled visa such as subclasses 189, 190 or 489/491. Many skilled migrants have high-level qualifications and years of work experience. You may find them valuable to the operation and development of your business.
In regional areas, the most common skilled visa held by migrants is 489 visa (to be replaced by 491 visa as from 16 November 2019). The 489 visa is also called Skilled Regional (Provisional) visa. Typically, under the invited pathway of 489 visa a skilled worker is nominated by an Australian state/territory or sponsored by an eligible relative and is then invited to apply for the visa. Once being granted a 489 visa, a skilled migrant is allowed to live, work and study in a specified regional area of Australia for up to 4 years (extended to 5 years under the new 491 visa). In New South Wales, a specified regional area means anywhere except Sydney, Newcastle, the Central Coast and Wollongong. For the new 491 visa, the specified regional areas in NSW are extended to cover anywhere except Sydney.
489/491 visa holders are eligible to apply for permanent residency if they have satisfied certain conditions relating to residence and work. Accordingly, they have a strong incentive to remain in employment with their employers in regional areas.
If you intend to employ a skilled migrant, you will need to first check if he/she has permission to work and any other work restrictions. You may use the free online service Visa Entitlement Verification Online (VEVO) to check the visa details and conditions of a particular skilled migrant.
When employing a skilled migrant, the employer must comply with Australian employment law. Migrants enjoy the same employment rights and protections as any other Australian employees do.
Employers are reminded that it is unlawful to disadvantage employees and job seekers because of their race, colour, descent, or national or ethnic origin. Therefore, it is important to ensure that your business have a discrimination-free workplace.
If you require assistance with any immigration and/or employment law matters, please contact Everingham Solomons because Helping You is Our Business.
As many of you would know, there is a 5 business day cooling off period which applies to the sale and purchase of residential real estate.
The intent of the legislation which created the cooling off period was to encourage potential purchasers to exchange quickly to avoid being gazumped whilst retaining the ability to pull out of the sale at minimal cost if anything untoward was discovered.
There are a number of situations in which the cooling off period does not apply. One of those situations is where the property is sold at auction or is sold on the same day after a failed auction.
A recent Supreme Court case demonstrated that it is not always easy to say whether an auction has in fact taken place.
The case involved the sale of valuable Sydney house. On the day of auction, many people attended but there was only one registered bidder. The auctioneer and the vendor’s real estate agent negotiated with that registered bidder without actually proceeding to auction the property. Announcements were made to the crowd thanking them for their patience and indicating that negotiations were taking place with the registered bidder.
The negotiations with the registered bidder were successful and a contract was entered into and a 10% deposit paid on the day of the proposed auction. A few days later however the purchaser pulled out of the deal and relied upon the cooling off period provisions. The vendor said the cooling off period didn’t apply because of the auction.
The Supreme Court held that the cooling off period did apply as the auction never commenced. Merely the advertisement of the proposed sale by auction and the gathering of people to attend did not constitute offering the sale by auction. The auction process required the auctioneer to open the auction and request bids.
At Everingham Solomons we have the experience and expertise to assist you with all your property transactions because Helping You is Our Business.
You’ve been saving hard and have the deposit to purchase your first home. You’ve looked at many houses and finally found the one. You’ve made an offer through the real estate agent and your offer has been accepted by the vendor.
You organise your pest and building reports. You know your finance is arranged as you’ve been pre-approved by your chosen lender. WRONG!
A pre-approval of finance from a lender is only an “indication” of the amount the lender considers you may borrow based on your previous financial circumstances. Until you receive written confirmation of finance approval from your lender noting the details of the house you intend to purchase and sign a loan contract, the lender is under no obligation to provide you with finance. If you were to exchange contracts based on the “pre-approval letter”, you may not be able to complete your purchase as the finance has not been formally approved for that house.
Not being able to complete your purchase may result in the vendor being able to terminate the Contract, keep your deposit, sue you for any shortfall in the price upon resale of the property and sue you for costs and expenses associated with your inability to complete the Contract and recover damages for breach of Contract.
Once your offer has been accepted, you need to make an appointment with your lender as soon as possible to complete a loan application for your chosen home. In most cases, your lender will arrange for a valuation of the property to be carried out to ascertain whether it will provide them with adequate security for their loan.
Many lenders need to submit your loan application to their mortgage departments located either in Sydney, Melbourne, or Adelaide. This takes time so you need to contact your lender quickly as this will enable you to safely exchange contracts and secure the property you wish to buy.
Some lenders provide a letter stating your loan has been approved subject to various conditions set out in the loan contract. This means you must wait to see the loan contract document to find out what terms and conditions you must comply with before the loan will be approved.
At Everingham Solomons, we take our role of protecting your interests very seriously. We work hard to help you secure the home you wish to purchase and make sure you do not end up in the position where you risk incurring a significant financial loss because you were unable to complete your contractual obligations. It might seem like it can take a long time before contracts are exchanged, but it’s all in the interests of looking after you – our client, because Helping You is Our Business.
Click here for more information on Suzanne Hindmarsh.
Quite often, land developers place restrictive covenants on land. For example the restrictive covenant be that: the land shall only be used for residential purposes, the buildings must be of a certain size or of a certain material or type of construction or design.
Are these restrictive covenants enforceable? The answer is sometimes yes and sometimes no.
Let’s take another example. If you purchase land in a subdivision which contains a restrictive covenant that permits the erection of a single residential building only, can you legally erect a multiple occupancy dwelling such as a duplex or triplex?
Despite what most people think, if the Local Government zoning laws permit multiple occupancies and a Development Consent to build multiple occupancies is granted by the Local Council, then the Council’s Development Consent overrides the restrictive covenant on the land. Therefore the restrictive covenant is ineffective and you can build a multiple occupancy dwelling on the land.
This is because of the provisions of Section 28 of the Environmental Planning and Assessment Act 1979 which clause is mirrored in Clause 1.9a of the Tamworth Local Environmental Plan, provides that to enable any development that has been approved by the Local Council, any covenant or other restriction on use of the land, shall not apply.
The aim of the legislation is to permit any development that is permitted by the zoning laws to be carried out irrespective of private covenants.
Section 28 however only affects a restrictive covenant to the extent that the covenant conflicts with a planning instrument or a consent.
Accordingly, Section 28 will not affect a restrictive covenant where the covenant does not conflict with an environmental planning instrument or development consent. For example in a restrictive covenant in relation to design of a structure, the type of fencing, the type of lawns etc, will remain valid and enforceable.
Land Law is complex.
At Everingham Solomons we have the expertise to assist you in all of your land dealings because Helping You is Our Business.
Before answering this question, we should first understand what agricultural land is. Under the foreign investment framework, agricultural land means land in Australia that is used, or could reasonably be used, for a primary production business. The meaning and scope of a primary production business can be found in the Income Tax Assessment Act 1997. It includes, for example, cultivating or propagating plants, fungi or their products or parts, maintaining animals for the purpose of selling them or their bodily produce, or manufacturing dairy produce from raw material that you produced.
If your land falls into the category of agricultural land, then the foreign buyer must get approval for the proposed acquisition from the Treasurer if the threshold of $15 million is exceeded. You may think that the value of your agricultural land is below $ 15 million, so there is no need to worry about the approval. However the $15 million threshold is defined as the cumulative value of agricultural land holdings owned by the foreign person (and its associates). For example, if foreign company A proposes to buy your agricultural land valuing $5 million, but it (or its subsidiary company) has already acquired an agricultural land valuing $11 million in Australia, then the proposed transaction would be subject to approval by the Treasurer.
There are exemptions to the above general rule, for example:
1. No threshold applies to foreign government investors; ie; any investment by a foreign government needs approval;
2. Higher thresholds apply to non‑foreign government investors from certain countries (e.g. a $1,154 million threshold applies to US, New Zealand and Chilean investors, and a $50 million threshold applies to Thai investors, and these thresholds are not cumulative);
3. The thresholds do not apply to certain acquisitions of agricultural land by owners or operators of wind or solar power stations.
If the proposed sale of your agricultural land requires approval, the application should be lodged by the foreign buyer with the Foreign Investment Review Board (FIRB). You could not complete the transaction until an approval is granted.
Lastly, the foreign person’s acquisition of your agricultural land must be notified to the ATO, regardless of whether it requires approval and regardless of value.
If you should have any questions in respect to the purchase of land by foreign investors, please contact me at Everingham Solomons because, Helping You is Our Business.
As of the 26th of September 2019, NSW has had a change to one of its road rules. From this date Motorists will be required to slow down when passing stationary Emergency or breakdown / tow vehicles which are displaying flashing lights.
A trial version of this rule change has been in effect for the past 12 months, however amendments to this have been made due to public feedback.
So what does this actually mean for Motorists?
Motorist will now be required to slow down when passing stationary vehicles which are displaying red and blue or yellow flashing lights. These vehicles include Ambulances, Police vehicles, Fire and Rescue vehicles, State Emergency Service vehicles, Volunteer Rescue Organisation’s vehicles, Traffic Commander vehicles, Transport Emergency vehicles, Tow Trucks and Breakdown Assistance vehicles.
Motorists who are travelling in an area where the speed limit is less than 90km/ hour, you will be required to slow down to 40km/hour when passing a stationary Emergency or breakdown / tow vehicles displaying flashing lights.
Motorists who are travelling in an area where the speed limit is more than 90km/hour, will no longer be required to slow down to 40km/hour, however will be required to slow down to a reasonable speed suitable for the conditions and circumstances. This speed is at the judgement of the Motorist, however it is expected that you make a clear, notable and safe attempt to reduce your speed. You will also be required to give plenty of space when passing these vehicles, including switching lanes if circumstances allow you to.
Much like all of the NSW road rules, penalties apply when you do not comply with them. In this circumstance, the penalty for breaching this road rule is a $457.00 fine and a loss of 3 demerit points.
If you believe you have been wrongly fined under this new road rule, you can apply to have the fine reviewed or appeal the penalty notice in Court, if you have grounds to do so. Before taking any matter to Court we strongly recommend that you seek legal advice from one of our experienced Solicitors as it can become quite costly if you are unsuccessful in your appeal. Everingham Solomons have experienced Solicitors that can assist you because Helping You is Our Business.
The position of a trustee of a trust is an important position which is governed by State and Commonwealth Legislation and Case Law.
When making a Will you need to be aware of special rules that apply to gifts to non-resident beneficiaries. These rules can even apply to gifts to Australian citizens who have lived overseas for a long period.
There are strict rules that apply when a Landlord wants to bring a residential tenancy to an end.
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.
As many of you would know, there is a 5 business day cooling off period which applies to the sale and purchase of residential real estate.
You’ve been saving hard and have the deposit to purchase your first home. You’ve looked at many houses and finally found the one. You’ve made an offer through the real estate agent and your offer has been accepted by the vendor.
As of the 26th of September 2019, NSW has had a change to one of its road rules. From this date Motorists will be required to slow down when passing stationary Emergency or breakdown / tow vehicles which are displaying flashing lights.