Mr Farmer died in 1988 leaving the farm to his wife during her life time and then to his son after her death. The son has worked on the family farm since childhood and is now in his late forties.
As the son does not own the family farm, he has had difficulties negotiating funding with his bank because of his mother’s life interest.
His mother agrees to surrender her life interest in the family farm during her lifetime, to enable the legal estate in the family farm to be passed to her son.
Stamp duty on the transfer of mum’s interest to the son is exempt under the inter-generational stamp duty exemption for primary production land.
The family farm is transferred to the son and the family is happy.
Are there any tax consequences of the release of the life estate?
Unfortunately, yes.
The mother’s surrender of her life interest constitutes a capital gains tax event and a market value is attributed to the mother’s surrender of her life interest. That gain must then be included in the mother’s taxable income for that tax year.
As the son has paid nothing for the land, the mother will need to find the money to pay the capital gains tax on the deemed gain on the disposal of her life interest.
The family particularly mum, are no longer happy.
Unfortunately, in this situation, it may have been better for the son to wait until the mother’s death so that the ATO would disregard any capital gain on the death of a life tenant.
Transfer of farming assets between family members is complex and professional advice should be sought.
At Everingham Solomons we have the expertise to assist you because Helping You is Our Business.
In a judgment handed down on 20 April 2012 in Roadshow Films v iiNet, the High Court unanimously found that iiNet did not breach copyright when its customers carried out illegal downloading via their iiNet accounts because, while iiNet may have known of the illegal downloading, it did not “authorize” that conduct by its customers. Well, of course it didn’t and the Court, which, with great respect, is made up of eminently sensible men and women with better than room temperature IQs was not fooled for a moment by the tortured arguments advanced by the copyright owners.
So, the copyright owners continue in a terrible flap about illegal downloading. That’s perfectly understandable. Copyright is a monopoly and monopoly is the keystone of capitalism. And, work which is the product of great creative effort should not be able to be pirated as easily as it is.
The difficulty for the copyright owners is that dissemination of intellectual property in the digital world is out of control and the copyright owners are hysterical and very heavy handed about the whole thing. They continue to lobby the Australian Government. They propose one of two models. First, the Chinese model, by which websites providing information on torrent files will be completely blocked in Australia in much the same way as China blocks Facebook and Google searches of “Tiananmen Square massacre”. The other is the Stasi model under which ISPs must inform on their pirate customers as every second citizen of the old East Germany informed to Stasi on his or her neighbour.
The Government seems reluctant to do anything much in the way of legislation in response to the onslaught of lobbying from the copyright owners. It says that it wants an “industry led solution”, which is Government speak for “don’t ask us; it is all too complicated”.
The copyright owners are not making much headway in Australia nor in the USA, where the proposed SOPA legislation would have put illegal downloader’s in goal for anything up to five years. This caused a great backlash. Wikipedia went down for 24 hours and politicians and journalists starting talking about “the vibe of the thing”, gibberish really but SOPA has stalled.
Sweden is a place where one can get into terrible trouble for illegal downloading but that’s not surprising given that that country’s rape laws are as difficult as putting together a piece of IKEA furniture; something Julian Assange found recently, to his absolute horror.
If you need advice on copyright or other intellectual property, we can help because Helping You is Our Business.
Relocation is a term used in family law proceedings when one parent wants to change where they live and take the children with them. For the Court to determine whether the children can move with that parent to a location sometimes hundreds of kilometers away from the other parent, the Court needs to consider many issues. One of the primary considerations that they take into account is whether the children can still continue to have a meaningful relationship with the other parent.
The recent decision of Lorreck & Watts [2012] FamCAFC 75 is one such case whereby the mother wanted to move from Canberra to Cairns and the Court had to determine whether this would be in the best interests of the children.
There were two children from the marriage aged 10 years and 5 years. The children lived with the mother and spent time with their father. Both the mother and father were born and raised in Queensland and their family and friends were still living there. The father was employed by the Australian Defence Force and throughout the course of the relationship the family moved many times to different locations across Australia.
When the marriage ended, the mother sought to move back to Cairns with the children to have the support of her family and friends. The father sought that the children live with him in Canberra should the mother move away.
At the first hearing of the matter, the Federal Magistrate confirmed that the mother’s case for moving was strong and there were many advantages for the children should they move. The only reason why the Federal Magistrate did not make Orders allowing the children to move was due to concerns that the youngest child would not be able to continue to have a meaningful relationship with the father.
The mother did not agree with this decision and sought a further hearing of the matter regarding evidence that was presented to the Court stating that the child would cope. The Court subsequently read the evidence of the psychologists and psychiatrists that was presented in the first case. After considering all of the evidence of the mother and the father, the Court determined that the Federal Magistrate had not taken this into account and subsequently permitted the children to move to Cairns.
If you wish to relocate or the other parent seeks to relocate you should seek legal advice from Everingham Solomons because we have the experience and expertise to assist you because Helping You is Our Business.
The NSW Treasurer has announced changes to State taxes and grants which are being heralded as “the most generous scheme in Australia”. Let us examine three key changes.
Firstly, from 1 July 2012, the New Home Grant of $5,000 will be provided to buyers of new homes, whether off the plan or newly built, up to the value of $650,000. The same grant will be available to buyers of vacant land up to the value of $450,000 upon which a new home is to be built. This incentive is open to non-first home buyers and investors alike.
A new home is a home that has not been previously occupied or sold as a place of residence, and includes a home that is a substantially renovated home.
Secondly, from 1 October 2012 a newly named First Home Owner Grant (New Home) Scheme will be introduced for first home buyers who purchase or build a new home. It will replace the current $7,000 First Home Owner Grant from 1 October 2012. The grant of $15,000 applies to contracts signed on or after 1 October 2012 to 31 December 2013. The grant will then be reduced to $10,000 as and from 1 January 2014. The new scheme will apply to first home buyers who purchase or build a new home valued up to $650,000.
Thirdly, from 1 July 2012 the First Home—New Home scheme provides eligible purchasers with exemptions on stamp duty for new homes valued up to $550,000 and concessions on stamp duty for new homes valued between $550,000 and $650,000. The same exemption will be available to buyers of vacant land up to the value of $350,000 and concessions on duty will be available for purchasers of vacant land valued between $350,000 and $450,000 who intend to build a new home on the site.
Importantly First Home—New Home exemptions or concessions do not apply to the purchase of an existing dwelling.
Also, if you are eligible for a stamp duty exemption/concession under the First Home – New Home Scheme, you cannot receive the $5,000 New Home Grant.
Furthermore, if you are eligible for a First Home Owner Grant, you cannot receive the $5,000 New Home Grant for the same property.
If you are considering buying a new home or vacant land to build your new home on, our experienced property team can help answer all of your questions, because Helping You is Our Business.
Click here for more information on Lesley McDonnell
What happens if you enter into a contract on the basis of some representation made by the other party, and you later find that representation to be untrue?
If the representation is included as a term of the contract, the remedy is straightforward, as an action for breach of that contractual provision will usually lie.
If the representation was not included as a term of the contract, but instead existed as a statement made prior to, and separate from, the contract document, the legal rights arising are a little more complicated.
If a false statement is made about a material fact and the purpose of that statement was to induce the other party into entering the contract, then the principal of misrepresentation arises.
The false statement must be about either a past or present fact. Generally speaking, a promise as to future events, a statement of opinion, or a statement of intention is not considered to be a statement of fact and does not constitute a misrepresentation.
Similarly, silence will not normally constitute a misrepresentation without some other special circumstances.
For a misrepresentation to occur it is also necessary to prove that the false statement was calculated to induce the aggrieved party to enter the contract and that the aggrieved party relied on the false statement in so entering the contract.
If a misrepresentation is established, it can be one of either two types; innocent or fraudulent. An innocent misrepresentation occurs where the statement was false, but the party making it did not know it to be so. A fraudulent misrepresentation occurs when the party knew that they were giving incorrect information.
If a person enters into a contract on the basis of an innocent misrepresentation, then a right arises to rescind the contract; that is to get out of the contract as though it had never existed.
If the representation which induced the party to contract was a fraudulent one, then the aggrieved party still has the right to rescind the contract, but the aggrieved party can also seek damages for any loss that they suffered by entering the contract in the first place.
If you have any further enquiries, or would like to discuss any matters of contract law further, feel free to contact Everingham Solomons Solicitors because Helping You is Our Business.
The starting point is that restraint of trade clauses are prima facie invalid because they infringe public policy, which holds, quite understandably, that a person should not be able to stand in the way of another person earning a living.
However, under the Restraints of Trade Act 1976 (NSW), a restraint clause will not be invalid if it was reasonable in all the circumstances at the time that it was made.
When deciding the validity of a restraint clause, the Court will ask whether the person seeking to impose the restraint (usually an employer or the incoming purchaser of a business) has a legitimate interest to protect and whether the restraint amounts to reasonable protection of that interest.
Legitimate interests include confidential information, client lists, secret operating procedures, formulae and the like. Legitimate interests are valuable. They can include an employer’s connection with his clients.
In a recent Victorian case, an employee had been seconded to one of his employer’s key clients. After a period, he resigned and took up a job with the client. The employer commenced proceedings to enforce the restraint clause, which prevented the employee from providing services to any former client for a period of 12 months after leaving his employment. The employer argued that its legitimate interest was the investment in their employee’s training and that the purpose of the restraint clause was to ensure that its employees did not use secondments as an opportunity to gain alternative employment. The Court found that the employer’s customer connection was capable of protection but such protection was only afforded where employees had achieved a position such that they had the practical ability to control their employer’s customers as if those customers were their own. The Court did not consider that the seconded employee fell into this category.
In determining whether restraint clauses are reasonable, the Court will consider various matters including the negotiation process, the bargaining position of the parties, the nature of the employer’s business, whether consideration was given for the restraint and the duration of the restraint and geographical area.
Legal proceedings should never be commenced without a great deal of analysis and consideration. In the case of restraint clauses, analysis of the legitimacy of the interest being protected and the reasonableness of the restraint will be critical. The employment team at Everingham Solomons can help with that analysis because Helping You is Our Business.
Have you developed a great product, logo, brand, design or process? Are you a wannabe “inventor”? Do you have a unique target market?
If this description fits you or your business, you should be considering intellectual property (IP) protection.
IP protection comes in various forms, depending on what you are wanting to protect:
Trademark: a valuable marketing tool which identifies your “brand”. Commonly used to protect a word, logo, letter, number, phrase, picture or shape (but can extend to sound and smell too!). By registering a trademark, you have a legally enforceable right to exclusive use of the trademarked item.
Patent: a right that is registered for new, inventive and/or useful devices, substances, methods or processes to provide the owner with a legally enforceable exclusive ability to exploit the invention.
Design: registration protects new and distinctive designs (that is, shapes, patterns, configurations) that have a commercial use. Registration of a design gives the owner exclusive rights of licence and sale.
Plant Breeder’s Rights: protects new varieties of plants to enable the owner to exclusively cultivate, sell and distribute. The owner of a Plant Breeder’s Right is entitled to receive royalties from the sale of the plant.
Copyright: protection of original expression of ideas (not the ideas themselves) is automatically protected in Australia. Examples include books, music, films, artwork and computer programs.
Registration of your Intellectual Property is required in order to obtain the protections offered by trademarks, patents, designs and Plant Breeder’s Rights. Failure to register your idea or product could lead to other people imitating your IP or worse still, claiming a registration so that you will not be entitled to use your own invention!
Online registration is now available to make the application process more timely and cost effective. There is no excuse for putting off your IP registration any longer.
If you are considering IP registration, contact the team at Everingham Solomons. We are well equipped to assist you with all your intellectual property enquiries Because Helping You is Our Business.
Click here for more information on Rebecca Greenland.
There are a number of valid reasons to terminate employment. These include:
Capacity
Capacity relates to the employee’s ability to perform the inherent requirements of the job. To rely upon capacity as a reason for termination, the core duties of a position should be compared against the employee’s ability to perform those duties. Evidence should exist to attest to the lack of capacity, and reasonable alternatives considered to termination.
Conduct
Reasons related to conduct can range from serious contraventions of workplace health and safety obligations to serious misconduct. There must be evidence that the conduct occurred. You should then assess whether termination is fair or whether a lesser form of disciplinary action is more appropriate.
Performance
In cases of persistent poor performance of duties, the employee should be notified of the precise issues, given an opportunity to respond and generally provided with a reasonable period of time to improve. There should be prior warning that continued poor performance may result in termination.
Genuine redundancy
Genuine redundancy may constitute a valid reason if it can be demonstrated that a position is no longer required to be performed by anybody, consultation with the employee has occurred, and acceptable redeployment options considered and offered.
Termination Pursuant to Employment Contract
The employer may terminate provided the employment contract contains a mutual notice of termination clause, and provides for the same or more generous notice period than required by the National Employment Standards.
Termination of any employment is always a serious issue, often involving complex legal issues and heightened by emotion and stress on both sides. Expert legal advice is required.
The Employment Law team at Everingham Solomons is well equipped to assist you with all your workplace relations issues because Helping You is Our Business.
Click here for more information on Jessica Simmonds.
An application was made before the District Court of NSW in late 2011 to trace the name of the biological father with the name of a former lesbian partner of the birth mother.
This application was made by a former lesbian partner of the mother of a ten year old child. The former partner and the mother chose to have a child by artificial insemination. The mother and the former partner met the sperm donor via a newspaper advertisement. The mother was inseminated. A child was born thereafter. The sperm donor was registered on the child’s birth certificate. Indeed, the sperm donor had a close relationship with the child and contributed tens of thousands of dollars to the child’s welfare.
In 2008 NSW law was amended to permit two women whom had a child when in a relationship to have BOTH of their names placed on the Register of Births as parents of the child.
Because of this change to the law, the former lesbian partner sought to have her name replace the sperm donor’s name on the birth certificate. He opposed the application.
The Court held:-
Under the provisions of the Status of Children Act, the rebuttable presumption in the father’s favour, that he is a parent is displaced by the irrebuttable presumption that because the child was conceived through a fertilisation procedure he is presumed not to be the parent;
The clear words of the Births, Deaths & Marriages Registration Act shows only two people may be shown on the Register as the child’s parents.
The sperm donor (biological father) agreed that there was no contractual agreement prior to the birth that he would be on the Register when he agreed to donate the sperm.
Whilst there might be conflicting views within the community as to who should be registered as parents, the law is clear. The former partner was successful.
We have the experience and expertise to assist you with all your Family Law needs because Helping You is Our Business.
Click here for more information on Jennifer Blissett.
Privilege in legal circles or legal professional privilege is a lawyer and client’s right to maintain confidences.
This means that any oral or written communication between a client and his or her solicitor cannot be disclosed. This has the effect of allowing the client to be open and frank with his or her solicitor without fear of incriminating themselves.
This right of a client is protected by both legislation and the common law. The Evidence Act 1995 provides that a confidential communication between a client, lawyer and/or third party is privileged, if the communication was bought into existence for the dominant purpose of providing legal advice and/or litigation.
This may sound like a fairly simple test, however you can be rest assured that lawyers will complicate it.
There have been a number of high profile matters where legal professional privilege has been raised. Most recently Michael Williamson, the head of the Health Services Union was caught with a suitcase full of documents in a carpark following a raid on his office. At this stage the Police have been unable to look at the documents as he has asserted that the documents were subject to a legal professional privilege claim. This claim is yet to be tested by the courts however the documents cannot be inspected by the Police until this claim for privilege is determined.
Another high profile case is that of Rupert Murdoch in the UK. Mr Murdoch said that his solicitors had done an investigation in which they found there was no evidence of any illegal activity. The law firm was unable to protect itself because the advice it had given was privileged and the privilege is that of the client’s. It could however be said that Mr Murdoch may have waived the privilege by saying what the advice was.
Advice must be legal advice and does not extend to advice given by accountants. Having said that if the advice is to a solicitor (about a mutual client), then it would be covered by legal professional privilege.
The privilege belongs to the client and can only be waived by the client or an order from the court. If you have any questions about capturing or maintaining privilege, please call us at Everingham Solomons because Helping You is Our Business.
Mr Farmer died in 1988 leaving the farm to his wife during her life time and then to his son after her death. The son has worked on the family farm since childhood and is now in his late forties.
