Introducing Ya Zhang

Its my great pleasure to introduce Ya Zhang, who recently joined the team at Everingham Solomons with a most impressive and unique experience.

Ya completed her undergraduate qualifications in law in China.  She was then admitted to practice as a lawyer in 2007.

For many years she worked from the Beijing and Shanghai offices of one of world’s largest law firms, primarily in their corporate and commercial law teams.

Ya then moved to the US where she obtained a masters degree in law from the Cornell Law School and shortly thereafter fulfilled the rigorous requirements entitling her to practice at the prestigious New York Bar.… Read More

Insolvent trading

A company is its own legal entity. While it doesn’t have a pulse, just like a person, a company can enter into contracts, incur debts, sue and be sued in its own name.

The directors of a company however must be living, breathing people.  They are the people that control the company.  Although the company is able to do things in its own name, it does so at the will of the directors.

Because a company is a separate entity from the directors that guide it, normally a company’s debts are repaid only from the company’s assets. The company’s creditors do not have access to the directors’ personal assets to repay the company’s debts. … Read More

Defensive Debtor Control – Clint Coles

Undertaking work before being paid is a part of business.  If you’ve been in business for a while you’ll know the difficulties that can arise in getting paid after the fact.

This is a situation where prevention is much better than cure.  There are a number of steps that a business can take to greatly reduce the likelihood of payment problems arising.

Although it seems simple, the first is often overlooked.  It is important to properly identify who your business is dealing with and to make an assessment of the creditworthiness of the entity you are contracting with.  People and companies can enter into contracts, but nobody else. … Read More

We are still learning – Ken Sorrenson

The saying “the only constant is change” certainly applies to the law and legal practice generally. Laws and client needs are constantly changing.

To be an expert and effective solicitor, a lifetime of continuing legal education is required.  In that context Everingham Solomons is very pleased to announce that Clint Coles has been awarded a Master of Laws degree by Sydney University.

The Master of Laws course conducted by Sydney University is without doubt one of the most rigorous and prestigious in Australia.  Clint’s studies centered particularly upon commercial law subjects such as –

  • advanced rules for the drafting and interpretation of commercial contracts, the ability for terms to be implied into contract and the availability of juristic remedies in the case of ambiguity;
  • personal and corporate insolvency including the roles of directors, proprietors, creditors and secured parties in insolvency;
  • Australian business taxes particularly the major transaction taxes of capital gains tax, stamp duty, GST and the various carve outs and concessions;
  • advanced study of the establishment and use of the commercial trust as a vehicle for business and investment, the regulation of managed investment schemes and the potential liability of trustees and beneficiaries,
  • the rationale behind and implementation of the recently developed Personal Property Securities regime in Australia, its impact on borrowers and secured parties and its role in the leasing environment; and
  • structuring strategies for asset protection in the estate and business planning context.
Read More

Air Conditioning in Rented Premises

In our climate, effective air conditioning is usually very important to any lease of retail or office space. A recent Victorian Civil & Administrative Tribunal case highlighted the legal importance of properly documenting and then complying with air conditioning arrangements.

In this case the tenant operated a Pilates studio from a retail premises in Melbourne. When the lease commenced the parties agreed to insert a special condition to the effect that –

  • the landlord would install new air conditioning;
  • thereafter it would be the tenant’s responsibility to maintain the air conditioning; but
  • the landlord remained responsible for any capital repair costs.
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Landlord and Tenant – What’s the best form of security? – Ken Sorrenson

KJSbwI’m often asked by Landlords what’s the best form of security to take from a tenant?

The usual forms of security are one or more of the following: –

  • Personal guarantee from directors or shareholders of a corporate tenant,
  • Cash bond; or
  • Bank guarantee

I generally recommend a bank guarantee.

A personal guarantee requires either a voluntary payment by the guarantors or for a landlord to sue the guarantors. Frequently, a personal guarantee proves to be ineffective because if the tenant can’t pay the rent there’s a good chance that the guarantor’s financial position may not be much better.

A cash bond involves the tenant actually paying an agreed amount of money as security for payment of the rent.… Read More

Debtor Control – A Key to Business Survival

MJEvery business relies on cash flow to survive. It matters not whether you have the best prices, products and/or customer service: if you don’t learn how to properly maintain cash flow, your business will eventually fail. By taking a proactive approach to debtor control you can improve your business’s cash flow and enhance its profitability.

Preventing Bad Debts

Ensure you manage the risk of bad debts by implementing a clear payment and credit policy. Consider:

  1. Performing a credit check on potential debtors:-
    1. Consider having them sign a credit application form or credit agreement
    2. Conduct a pre-credit data check or/and ask for trade references
  2. Setting clear payment terms:-
    1. e.g.
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Do Directors Duties Continue After Retirement? – Ken Sorrenson

KJSbwBusiness relationships are like marriages. Some stand the test of time, others do not.

A company in which two or more unrelated parties are directors and shareholders is a very common structure. The parties involved usually know each other well and learn to accommodate each other’s idiosyncrasies for the good of the ongoing business.  That frequently changes when business operators age or die bringing new people into the business.

The recent case of Advanced Fuels Technology v Blythe arose in that factual situation.

The company Advanced Fuel Technology (AFT) had operated for many years under the equal control and management of Mr Blythe and Mr Thompson.… Read More

Do directors need an indemnity from the corporation they represent? – Terry Robinson

TLRbwWhilst a company structure generally protects directors from being personally liable to pay the company’s debts, this is not always the case. Further Directors may be fined personally by ASIC, or may have to pay the companies taxation liabilities such as PAYG or employee superannuation payments.

So, yes it is a good idea to have what is called a Deed of Access and Indemnity.

The deed is a contract between each director and the Company.

It gives the Directors access to the company’s records, payment of legal costs, and requires the company to affect directors and officers insurance, both during the director’s appointment and for a period of years thereafter.… Read More

TO AIRBNB OR NOT TO AIRBNB – Ken Sorrenson

KJSbwAirbnb and other similar types of short-term accommodation are now very widely used in NSW.

This has been controversial particularly in strata title developments. The perception of “permanent” strata residents has been that short term occupancies are disruptive and sometimes actually damaging to strata property. This has led many strata developments to pass bylaws intended to prohibit short-term lettings which in many cases have been ignored by owners seeking to maximise rental returns from their properties. The issue has become whether strata developments can legally restrict short-term letting?

The NSW Department of Fair Trading view is/was that-

“Strata laws prevent an owner’s corporation restricting an owner from letting their lot, including short-term letting.… Read More