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  • agents beware: attorneys behaving badly

    Agents Beware: Attorneys Behaving Badly

    Tips for agents when receiving instructions from third parties and enduring powers of attorney.

    It is not uncommon for real estate agents to be approached by someone acting under a Power of Attorney on behalf of a registered proprietor.

    Where a registered proprietor has appointed an attorney under an Enduring Power of Attorney, it is important that the agent make some enquiries to ensure that person has the legal authority to provide instructions.

    We are living in an ageing population. It is fast becoming a luxury to remain in the family home until death. There is an increasing need for people to move into residential aged care facilities, where a standard method of payment is by way of a ‘Refundable Accommodation Deposit’ (RAD). A RAD is a lump sum payment that operates like a loan in favour of the particular aged care facility. The balance of the RAD is then refunded to the estate of the resident on their death.

    For many elderly people, it is not financially viable to fund a RAD without selling their main residence. To complicate matters, once an incoming resident elects to pay a RAD, they generally only have a period of six months to come up with the money. This increases the pressure on sellers, agents and conveyancers to efficiently bring about exchange and settlement of the property.

    An Enduring Power of Attorney is a legal document under which a principal appoints an attorney (or attorneys) to make decisions on their behalf. The document is ‘enduring’ in that it continues to operate even if the principal loses decision–making capacity. In the Australian Capital Territory, an Enduring Power of Attorney typically gives an attorney broad decision–making powers, including in relation to the property and financial affairs of the principal. It is possible for a person to have a valid Enduring Power of Attorney that grants no powers in relation to property. If an attorney does have powers in relation to a principal’s property matters, these powers may be of immediate effect, or, more often, the use of the powers is conditional on the principal having lost capacity.

    The first thing a real estate agent should do when approached by an attorney is request a certified copy of the Enduring Power of Attorney. The agent should then review the document and consider the following issues:

    1. Is the person giving the instructions actually appointed as an attorney?;
    2. Is the attorney granted powers over property matters?; and
    3. When does the attorney’s power come into effect?

    If the power is expressed to be conditional on the loss of capacity, the agent should go on to request some type of supporting evidence. Generally, a letter from the principal’s General Practitioner, treating Geriatrician, or other specialist is sufficient in this regard. Real estate agents should also be aware that where an attorney intends to act on behalf of a person who is entering into contracts for the sale, purchase or

    leasing of land, the Enduring Power of Attorney must be registered at the ACT Land Titles Office. All Enduring Powers of Attorney must be witnessed by a qualified witness. If you are unsure about any of the issues discussed in this article, or if you would merely like some peace of mind, it is a good idea to contact the person who witnessed the document. Often this will be the solicitor who drafted the document, and who has acted for the client previously in relation to their estate planning arrangements. It was only last week that we had a telephone call from a concerned real estate agent: “Joe Bloggs has turned up at our office waving a document and telling us to sell his mother’s house, including its contents”.

    A significant percentage of elder abuse is committed by attorneys (frequently adult children) appointed under an Enduring Power of Attorney. Aside from superannuation, the family home is often a person’s most valuable asset. Both of these facts highlight the importance of communication between real estate agents and solicitors, and the value in adopting a collaborative approach. As the saying goes, it is better to be safe than sorry. There are a few simple steps real estate agents can take when instructed by attorneys to protect not only themselves, but ultimately the interests of the vulnerable property–owner.

    The Estates & Business Succession Team of BAL Lawyers, a Corporate Partner of REIACT, can assist agents and agencies in reviewing Powers of Attorney. Please contact us to discuss.

    First published in the REIACT magazine.

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  • Termination employment policies and procedural fairness

    Terminating employment: pornography, policies, and procedural fairness

    When handled insensitively or without regard to the regulatory landscape, termination can open a Pandora’s box of potentially litigious grievances.

    Ordinarily, the use of employer provided equipment to access, download and/or store hard core pornographic material would represent misconduct. Unless the employee worked in the sex industry it would be difficult to contemplate that the viewing, downloading and/or storage of pornographic material represented proper, work-related use of the employer’s equipment. — Commissioner Cambridge in Croft v Smarter Insurance Brokers Pty Ltd.

    In late September, the Fair Work Commission delivered judgment in a seemingly remarkable unfair dismissal case. The employer had sought to rely on pornography found on the fired employee’s work laptop and mobile phone, discovered after termination, to justify the dismissal. While Commissioner Cambridge accepted that such actions constituted misconduct, he nevertheless concluded that a panoply of errors in the termination
    process meant that they did not constitute a valid reason for dismissal. The termination was therefore harsh, unjust and unreasonable, and an award of compensation was ordered — an eye-catching result given the applicant admitted using employer provided technology to download pornography.

    Croft is highly instructive, providing employment lawyers and employers alike with a range of lessons about how not to terminate employees. The dispute highlights the limitations on the ability of employers to justify
    dismissals based on information acquired post-termination, while also emphasising the importance of procedural fairness, rigorous policy mechanisms and consistency in workplace decision-making. This
    article will commence with an outline of Croft, before considering each topic in turn.

    Croft

    Mr Allan Croft was an insurance manager at a small insurance broking firm. His employment was ‘beset with difficulties from an early stage’ due to his ‘fractious’ relationship with the Directors of the employer. The employer alleged that Mr Croft was given several verbal warnings about underperformance and misconduct during his employment, but these were never particularised in written form.

    In January 2016, the employer dismissed Mr Croft. Rather than terminating on the basis of underperformance or misconduct, they sought to rely upon a contractual clause which purportedly permitted termination without cause on four weeks’ notice. Mr Croft subsequently filed unfair dismissal proceedings.

    In his decision, Commissioner Cambridge firstly dealt with the alleged ‘right to dismiss at will’. He held that a dismissal made without reason but solely reliant on a purported contractual right ‘would plainly subvert the statutory unfair dismissal laws, and also offend the broader common law position’. Commissioner Cambridge then considered whether Mr Croft’s accessing, downloading and storing of hard-core pornographic material on employer provided technology — the alleged misconduct discovered only after he had been dismissed — constituted a valid reason for the termination of his employment. On balance he decided — for reasons outlined below — that it did not. Accordingly, Mr Croft’s dismissal was found to be harsh, unjust and unreasonable, and $10,000 in compensation was awarded.

    Continue Reading.

    Written by John Wilson and first published in Ethos.

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  • Crown Lease

    Crown Lease in the ACT: What a strange Land it is! Sort of.

    Buying real estate in Canberra – the first thing you will notice is that you don’t actually buy the Land.

    The Australian Capital Territory (ACT), and in particular Canberra, offers an almost unrivalled standard of living and lifestyle. Its open landscape City plan facilitates ease (and speed) of travel throughout the Territory and provides  generous access to restaurants, cafes, parklands and the rural hinterland making it one of the most highly rated and liveable  cities in the world. Yet when you look at buying a stake in the ACT, you’ll be confronted with a somewhat different form of “land ownership” compared to that of its neighbours New South Wales  and Victoria, namely leasehold. The ACT’s leasehold system applies to all land in the Territory, other than National Land. Under the leasehold system, all land is owned by the Commonwealth and leased to residents of the ACT, meaning that all commercial, residential, rural and community title land is owned and leased by the Commonwealth and managed by the ACT Government. The terms of this leasing arrangement are set out in what’s called a Crown Lease.

    But the system, in practise, is not so alien. The Crown Lease sets out the terms and conditions for the “owner’s” (the “lessee”) use and occupation of the land, including the right to exclusive use and enjoyment of the land during the term of the Crown Lease. This is not so different to the manner of land use control exercised by state planning authorities, such as a “Council”. The Crown Lease however, dispenses with the often politicised approaches that can occur through “Council approval” processes.

    Before entering into a “Crown lease”, there are some points to consider:

    Length of Crown Lease

    Ordinarily, the term (or length) of a Crown Lease in the ACT will be 99 years. So, although the money you’re coughing up for your house may not buy you the land, you will be buying the right to use the land for the term of the Crown Lease. For most purposes, there is no practical difference between the use of the Crown Lease in the ACT and other title systems in Australia, a Crown Lease can be sold, mortgaged or devised under a will.

    But then what? 

    Although most residential Crown Leases in the ACT are granted for a term of 99 years, the term will not be renewed upon your purchase of the Crown Lease. You will instead acquire the balance of the term of the Lease.

    Upon expiry of the term of the Crown Lease, provided that the land is not required by either the Territory or the Commonwealth and the terms of the Crown Lease provide for a renewal, you may apply for a renewal of the Lease. The first renewals are approaching and there is every political and social reason to expect that these leases will be seamlessly renewed; in fact, many Crown Leases have already been renewed for valuation or sale purposes, as mortgagees often require that you apply for a renewal if the term of the Crown Lease is set to expire with 25 years.

    Development conditions

    When considering buying vacant land in the ACT, you should seek a copy of the Crown Lease as it will contain development conditions and construction timeframes. You can also check the Lease and Development Conditions Register. This will allow you to see building, lease and development conditions prepared for the blocks – the Environment and Planning Directorate must approve these conditions.

    Lease availability

    For new blocks of land, or areas that are still being developed, Crown Leases will not be issued until all necessary services, roads and other civil works around the area are completed. In this instance, you will not become the registered owner of the land until the works are complete and the Crown Lease has been granted and registered at the ACT Land Titles Office.

    As you will not be the registered owner until the Crown Lease has been granted, you may find it difficult to borrow money from a bank or other financial institution, and will not be able to build on the land, until the Crown Lease is granted. In most instances, a specimen (or draft) Crown Lease will be attached to a Contract for Sale to assist you to determine what you are buying and to obtain finance (where necessary).

    Costs

    The rent to be paid by an owner (or lessee) under a residential Crown Lease will be 5 cents if and when demanded” (no demand has yet been made), but some, and typically commercial or rural leases have substantive land rent.  Such leases are subject to payment of an annual land rent charge billed quarterly; however, lessees have the option of paying weekly, fortnightly, monthly or quarterly.

    Selling your leased block?

    As the lessee under a Crown Lease, you can sell your interest in the Crown lease provided you have complied with all building and development conditions contained in the Crown Lease, or you must otherwise obtain consent from the relevant Minister to the sale of the land.

    In short, if you are looking to buy real estate in Canberra under the modern land ownership leasehold system and get a new Crown Lease on life, consider the points above and seek advice as to your rights and obligations. If you’ve finished this article, and are still wondering about the strange land laws of the ACT, please contact the team at BAL Lawyers, as we can answer any questions you might have regarding leases in the ACT.

    First published by Capital Express.

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  • Designated responsibility supervision duties of a law firm

    Designated responsibility: the supervisory duties of a law firm principal

    It is a breach of the Solicitors Conduct Rules to allow an employee to have conduct of a matter without reasonable supervision. This article considers two matters relating to the duty to supervise.

    The Legal Profession (Solicitors) Conduct Rules 2015 contain an express duty for solicitors with designated responsibility for a matter to exercise reasonable supervision over all employees engaged in the provision of legal services for that matter. This is a non-delegable supervisorial responsibility.

    Allowing an employed solicitor, clerk,paralegal, or any other employee to have the conduct of a matter without reasonable supervision breaches that rule and, depending on the seriousness of the failure involved, may constitute unsatisfactory professional conduct or professional misconduct, especially in financial matters.

    Supervisors’ duties

    Kelly v Jowett [2009] NSWCA 278 (4 September 2009)

    This case was an appeal from a Family Provision Act matter where an employed solicitor handling the matter in the first instance had, among other things, deliberately and consistently flouted the Court’s orders and directions, and had failed to file affidavit evidence in the matter. The Court of Appeal considered whether there had been a failure by the firm to supervise the employed solicitor.

    The employed solicitor signed a notice of appearance as the solicitor on record. During the conduct of the matter he failed to keep the client appraised of the progress of the matter, failed to comply with undertakings to file affidavit evidence
    within defined times, gave the clients 20 minutes’ notice of a Court ordered mediation (which the client was unable to attend due to the late notice), and had failed to inform the clients of the hearing because he had told them he would be seeking an adjournment. The employed solicitor appeared at the hearing, without the clients, and gave submissions.

    In short, the carriage of the matter was left entirely to the employed solicitor. The partners of the firm did not take any direct role in supervising the employed solicitor’s conduct of the matter. This remained the case even after the partners knew of the employed solicitor’s unreliability and his serial delinquency in complying with the Court’s directions. The partners told him “This file is your mess, clean it up”.

    By the time of the Appeal judgment, the employed solicitor was no longer practising. Other solicitors within the firm described the employed solicitor’s conduct in intra-firm communications as “woeful”.

    Keep Reading.

    First published in Ethos.

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  • HR-Human-Resources-Bully-Harassment

    Bullying and Harassment: The New Black in HR

    Being a HR manager, there will often be times you have to deal with employees not getting along.

    You may be dealing with employees complaining about being bullied, requests to be moved to different office locations, claims of unfair work loads and staff taking long breaks.

    These situations can get out of hand very quickly if not dealt with swiftly.

    To illustrate some of the do’s and don’ts of how to deal with bullying claims at work, watch the case study video below that follows Sarah, Jim and Julia through their tales of bullying. This tale is based on a true story, but for education purposes only, of course.

    The video highlights Sarah’s story as a manager at an accounting firm, and her actions around some of the employees she supervises.

    Jim thinks Sarah is putting too much pressure on him and makes a bullying complaint to the HR Manager.

    Julia makes a complaint to HR that she is being bullied by Sarah her as well, citing that Sarah ‘monitors her breaks’.

    Sarah, in turn makes a complaint about the two employees that have made unsubstantiated bullying accusations against her, she also feels that they have been spreading rumors about her.

    The claims end up in front of the Fair Work Commission, who note that these issues should have been dealt with on a HR level, and not have been allowed to escalate to this point.

    Bullying at work occurs when: a person or a group of people repeatedly behaves unreasonably (objectively!) Towards a worker or a group of workers at work, and the behaviour creates a risk to health and safety.

    Take Note: bullying does not include reasonable management action carried out in a reasonable manner.

    It is important to refer to your office bullying and harassment policy, to make sure you are treating employees fairly and reasonably.

    If you need help dealing with bullying and harassment claims at work, please contact the employment team.

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  • The midwife who breached a mother's confidentiality: lessons for public servants

    The midwife who breached a mother's confidentiality: lessons for public servants

    Public servants must comply carefully with their confidentiality obligations, a recent case highlights.

    An employee, whether in the public or private sector, has obligations of confidentiality to their employer. The extent of these obligations varies significantly, depending on the nature of the job, the employer and the information at issue. The onus of confidentiality has a multitude of sources, arising from legislation, contract and the law of equity: this combination, it has been said, “is an unhappy mixture”.

    Our starting point, as usual, is the federal Public Service Act. The Australian Public Service’s code of conduct imposes a range of requirements with relevance to confidentiality: public servants must “behave honestly and with integrity”, “act with care and diligence”, “comply with any lawful and reasonable direction” and “maintain appropriate confidentiality about dealings that the employee has with any minister or minister’s member of staff”. Similarly, federal government staff must “at all times” comply with the APS values, one of which is that “the APS demonstrates leadership, is trustworthy and acts with integrity, in all that it does”.

    Beyond these legislative obligations, public servants – like ordinary employees – have duties of confidentiality arising from their employment contract. These can be express or implied. The twin implied duties of “loyalty and fidelity” and “confidence” impose requirements on employees not to misuse information gained in the course of their employment. Both duties also have alternative underpinnings in the law of equity, such that the exact shape of these confidentiality obligations is frustratingly nebulous.

    This uncertainty is compounded in the public sector context because of the special nature of such employment, and a lack of judicial clarity as to whether the duties should be altered to reflect that character. As Federal Court Justice Paul Finn explained in 2003, “there is no significant Australian jurisprudence on how the duty is to be adapted to accommodate the distinctive demands of public service employment that result from the ‘special position’ [that] … public servants enjoy … This is not the place to essay the significance that ought be given to the precepts of loyalty, neutrality and impartiality which are hallmarks of a public service … My only comment would be that to consider the duty in a setting such as the present without regard to such precepts would involve a flight from reality.”

    While such high-minded concepts were not at issue in the recent South Australian Industrial Relations Commission case of Kore v chief executive, Department of the Premier and Cabinet, the judgment provides an instructive example of the confidentiality obligations imposed on government employees.

    In Kore, a midwife at a public Adelaide hospital, Erin Kore, sought out information about a newborn baby and then passed these details on to a personal friend, the baby’s father. While the midwife knew the mother and father were no longer in a relationship, she was apparently unaware of a past history of aggressive behaviour on the father’s part. The mother soon drew this breach of patient confidentiality to the hospital’s attention, citing safety concerns for herself and the baby, and the midwife was suspended pending an investigation into alleged breaches of South Australia’s code of Conduct equivalent.

    Kore was later sacked, and brought proceedings claiming the dismissal was harsh, unjust or unreasonable. She argued there were numerous mitigating circumstances: the midwife otherwise had an exemplary record, this was a single isolated incident, she had shown contrition, cooperated and had not acted maliciously. While commission Deputy President Karen Bartel accepted many of these arguments, she ultimately denied Kore’s application: “It is with some regret that I am unable to conclude that the dismissal was harsh, unjust or unreasonable.”

    Three of Bartel’s observations are noteworthy. First, the hospital asserted that Kore had no valid reason for accessing the information from the birth register, despite the fact that reviewing the register was an ordinary part of her role. Bartel wrote: “I do not accept the respondent’s view that the applicant should have skimmed past the entries for Ms H in the birth register … This criticism is not realistic … The issue is not that she became aware of the details, but that she disclosed them”.

    Moreover, Bartel emphasised that the employee’s position will be a highly relevant factor. That Kore had obligations under the code of ethics for midwives in Australia and that maintaining the confidentiality of patient health information was an integral requirement of her role both weighed heavily in Bartel’s decision. “The applicant’s conduct,” Bartel wrote in her concluding remarks, “took place in the context of professional obligations upon her, which emphasise the importance of trust and confidentiality”.

    Finally, consonant with Finn’s comments above, Bartel stressed the importance of context in determining the gravity of a confidentiality breach. She wrote: “The nature of public sector employment carries with it obligations which do not exist in the private sector because of the public accountability requirements of government.”

    Yet the public service’s special nature cuts both ways. Public servants may have greater duties than private sector employees, but these duties are ultimately owed to the Australian people, not a particular department or manager. The necessary consequence is that there will occasionally be situations where disclosure of confidential information is in the public interest, even if – were it to take place in the private sector – it might represent a breach of confidentiality. That was not contended in Kore for obvious reasons, but such cases have arisen previously.

    The law’s response to this conflict is uncertain. Finn once hinted that, in cases where the implied constitutional protection of political communication is invoked, it might not be proper for the federal government to rely on a duty of confidentiality. Elsewhere, it has been suggested that the public interest in the disclosure of “iniquity”, whether criminal, civil or political wrongdoing, “will always outweigh the public interest in the preservation of private and confidential information”.

    APS employees should take due care to abide by their confidentiality duties, particularly given the unsettled legal position. As Kore shows, breaches can happen inadvertently and even when the individual believes themselves to be acting in good faith. However, confidentiality should not silence public servants when the public interest demands otherwise.

    Judicial luminary Anthony Mason deserves the final word. As he explained in the High Court’s 1980 Commonwealth v John Fairfax & Sons Ltd judgment: “It is unacceptable in our democratic society that there should be a restraint on the publication of information relating to government when the only vice of that information is that it enables the public to discuss, review and criticise government action.”

    First published in the Canberra Times.

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