A recent judgment has tipped the scales even further to the government’s advantage against public servants.
The federal government, it has been said in the litigation context, is a “behemoth”. Public servants who take on the might of the bureaucracy in employment disputes have always faced an uphill battle. The government has practically unlimited resources and its pick of legal talent; employees often have neither. However, in the past this stark inequality was partially alleviated by a requirement in the Fair Work Act that parties must seek permission before they can be represented by lawyers.
Following Gibbens v Commonwealth of Australia, public servants no longer have even this minor protection. In July, the Fair Work Commission rejected an appeal against a decision which gave lawyers at the Australian Government Solicitor the right to appear for the government without permission.
The relevant legislation provides an automatic right of appearance for lawyers who are employees of a party. But, so appellant Gregory Gibbens argued, lawyers of the AGS hold a distinct role: the AGS is a government legal practice that works across departments, whereas the exception is aimed at in-house lawyers. The Full Bench disagreed: “AGS lawyers are … employees of the respondent (that is, the Commonwealth) engaged by the Secretary of the Attorney-General’s department to work in that department.” Accordingly, post-Gibbens, the AGS can appear without leave before the Fair Work Commission, while public servants require permission to have legal representation.
While the legislative interpretation in Gibbens may be correct on a strictly textual view, it is entirely contrary to the Fair Work Act’s policy intention. The explanatory memorandum stated that the commission would “move away from formal, adversarial processes … There will also be a higher bar set for representation.” Tellingly, it continued: “Permission for representation will only be granted to parties (including the minister) where it would enable the matter to be dealt with more efficiently or fairly” (emphasis added).
Moreover, the Gibbens precedent, which the government has since relied upon in other matters, contradicts the position departments have taken in other contexts. In a 2004 High Court case, the Department of Immigration argued that the AGS was not “the Commonwealth” for the purposes of recovering legal fees. Justice William Gummow agreed. While that judgment was made when the AGS was a Commonwealth authority, and it has since been subsumed within the Attorney General’s department, this is seemingly a distinction without a difference.
The government’s approach to this issue continues a trend of self-serving inconsistency – some might even say hypocrisy – when it comes to workplace relations. Two other examples are instructive.
Judges have long adopted the view that the federal government and its myriad departments form one legal entity. The High Court held in 1920 that “the Crown”, or the executive branch, “is one and indivisible”. The bench continued: “Elementary as that statement appears, it is essential to recall it, because its truth and its force have been overlooked.”
In all but name, the government often engages in pattern bargaining during the enterprise bargaining process – seeking common terms for distinct enterprise agreements across multiple agencies – which is illegal under the Fair Work Act. This is permissible, they say, because the departments are not distinct employers but all part of the Commonwealth of Australia.
But when a dismissed public servant pursues reinstatement in the Fair Work Commission, agencies invariably resist on the grounds that doing so would be disruptive to the workplace. If the Commonwealth is just one legal entity, why can’t the unfairly dismissed public servant be reinstated to another department? This issue has arisen in the Fair Work Commission on occasion, and there are no prizes for guessing the position adopted by the Commonwealth when the shoe is on the other foot.
Former Canberra-based Fair Work Commissioner Barbara Deegan was frank about this contradiction in an interview with Workplace Reviewfollowing her retirement. “The bargaining framework does sit uncomfortably with the prohibition on pattern bargaining. Of course in a formal sense there is no inconsistency. The bargaining framework only applies to a single employer – the Commonwealth of Australia. But then in other contexts, when it is suggested that the Commonwealth is a single employer, the response is that under the Public Service Act each agency head is a separate employer or exercises all the powers of an employer. So there is a very good argument that the Commonwealth can’t have it both ways”.
Another area of inconsistency involves the APS’ reach into the private lives of public servant. I have written repeatedly about the government’s overreach in this field, and controversy was sparked again last month when the Australian Public Service Commission sought to regulate public servants’ “liking” of Facebook posts.
This expansive interpretation of the Code of Conduct’s scope was highlighted by one passage. The APSC instructed: “Your capacity to affect the reputation of your agency and the APS does not stop when you leave the office. The comments you make after hours can make people question your ability to be impartial, respectful and professional when you are at work. APS employees are required by law to uphold the APS Values at all times.” Political opinion is not the only area where the APS has sought to intrude into the private lives of employees.
Yet when an employee injures themselves outside of the office (but still in a workplace context), the APS has sought to resile from its workers’ compensation obligations. Comcare famously fought all the way to the High Court (and won) in a case involving a public servant injured having sex while away from home on work travel. The comparison between Comcare v PVYW and free speech cases may be crude, but the point nevertheless remains: the government argues for an expansive definition of what falls within the scope of employment when it suits them, and a restrictive definition when it does not.
Although so much might be expected from a private litigant, Australians are entitled to hold the Commonwealth to a higher standard. Indeed the Model Litigant Guidelines require the government to act “consistently in the handling of claims and litigation”. While it is not obliged to “fight with one hand behind its back in proceedings“, it should certainly not – to use Deegan’s language – be able to have it both ways.
John Wilson is the managing legal director at Bradley Allen Love Lawyers and an accredited specialist in industrial relations and employment law. He thanks Kieran Pender and James Macken for their help in preparing this article.Read more
The ATO has released Practical Compliance Guideline 2017/D12 which provides some welcome clarification regarding when a Legal Personal Representative (“LPR”) may be personally liable for tax liabilities of a deceased estate.
Thankfully for the non-professional LPR, the Guideline provides “user friendly” explanations and a series of practical examples.
Despite the fact that the liability of an LPR to pay tax related liabilities being limited to the value of the deceased’s assets, the Guidelines make it clear that an LPR may be personally liable for tax liabilities if they had sufficient notice of those claims.
The question then becomes, what constitutes “sufficient notice”, and this is where the Guidelines offer some assistance.
Whether or not an LPR had sufficient notice is a question of fact. In some circumstances however, an LPR will be deemed as having sufficient notice. Those circumstances include:
The Guidelines also make it clear that the ATO will not treat an LPR as having notice of any further potential ATO claim relating to returns lodged by the LPR where:
It should be noted the Guidelines apply only to “smaller and less complex estates” that satisfy the following:
Importantly, where the Guidelines do not apply, the LPR continues to have an ongoing risk of personal liability.
It should be noted that once a tax return is lodged, the Commissioner generally has 2 to 4 years, (depending on the nature of the assets in the estate), from the date on which he gives the notice of assessment to amend the assessment.
In other words, while the LPR may not be personally liable if he or she has acted reasonably in lodging all returns and the ATO has not given notice that it intends to examine the deceased’s tax affairs within 6 months, the Commissioner can still amend the notice of assessment up to 4 years from lodgement.
If there are concerns that the ATO may audit the estate, a conservative approach could be to not distribute the estate until 2 or 4 year period has lapsed.
From a practical point of view however an LPR may want to consider:
A properly documented loan agreement can be an effective tool to preserve family wealth.
It is fairly common to find loans between family members and family entities, sometimes for very substantial sums of money. Often the terms of loans between family members are undocumented which can result in complications including complications arising as a result of the following:
Funds advanced to family members that are not documented are uncertain. Questions that may arise with undocumented loans include.
Undocumented loans can be construed as gifts to the recipient (particularly when it comes to family members, there exists a rebuttable presumption that funds advanced constitute a gift). Funds which are construed as gifts could mean they are vulnerable to attack in the event of a relationship breakdown or insolvency.
It should be noted also that if the advance is construed as a gift that the executors do not have an inherent power to reduce a beneficiary’s share of an estate by the amount advanced.
Undocumented loans can be construed as being payable on demand.
Loans that are payable on demand mean (i.e. continuously recoverable at all times) mean that the cause of action arise when the money is advanced. In other words, the time for recovery for the purposes of limitations law is from the time the loan is made, not from the time the demand is made. As a result, if a loan was made more than 6 years ago (the limitation period), it may be irrecoverable.
A properly documented Loan Agreement can prevent these complications from arising by:
It is not enough that there is a document in place between the parties that is signed and dated. The more the loan is presented at arm’s length, the more it is likely to be construed as a “loan”. In other words, your loan agreement should aim to contain the following terms:
A properly documented Loan Agreement is also a useful tool to incorporate as part of a succession plan when trying to maintain equality amongst beneficiaries. To discuss adding a loan agreement to your will, please contact us.Read more
Australia by Design is an architectural show that showcases the top 10 architectural statements for the year in each state and territory in Australia.
The show is hosted by Tim Horton, a renowned Australia Architect.
Mark Love was chosen as a guest panelist, and had the pleasure of reviewing the Kim Harvey School of Dance by Clarke Keller Architects. This particular building also won the Art in Architecture Award at the 2016 Australian Capital Territory (ACT) Architecture Awards. The episode is available to watch below.
The other episodes are available to watch here.Read more
It is a common (though perhaps dangerous) assumption that a successful party to litigation will obtain an order that the unsuccessful party pay their costs on a party/party basis.
This is traditionally known as ‘costs following the event’, with the ‘party/ party’ component of a costs order usually amounting to about 70 per cent of the cost a party has actually incurred.
However, the ACT Court of Appeal’s recent decision in Cooper v Singh provides a useful reminder that the awarding of costs is an entirely discretionary power that courts may exercise as they see fit.
It follows that the expectations of a party (and their counsel) as cost may not align with the court’s view as to how its discretion should be exercised.
Singh also highlights the complex relationship between Calderbank offers and Offers of Compromise, the latter a device created by the Court Procedure Rules 2006 (ACT) (“the Court Rules”).
In Singh, the plaintiff was injured in a motor vehicle accident leading to myriad personal injuries. Prior to the matter being heard, the defendants made an offer to settle the case for $540,000 plus costs. The offer was stated to be pursuant to the principle in Calderbank v Calderbank. The effect of the Calderbank nature of the offer was that, should it not be accepted and the plaintiff fail to obtain an outcome better than $540,000, the defendants could seek an order that the plaintiff pay their costs on an indemnity basis from the date of the offer.
Through this regime, while a plaintiff may enjoy some success in obtaining a judgment, if a defendant can demonstrate that costs were unreasonably incurred because of a plaintiff’s rejection of an offer which would have seen him or her better off overall, a Calderbank may provide costs protection for the defendant. At first instance in Singh, the plaintiff succeeded at hearing but only for $311,603 — a sum considerably less than the defendants’ Calderbank offer.
With the offer having been made shortly before the commencement of the hearing, the defendants sought an order that their costs, essentially those of the hearing days, be paid by the plaintiff on a full indemnity basis.Read more
While the vast majority of employers take the provision of references seriously and provide fair and beneficial documents, a misleading or erroneous reference can be costly. A candidate may require
more training than their reference suggests, or may be entirely unsuited for the position. A derogatory reference, meanwhile, can considerably harm an individual’s job prospects.
Given the vulnerability of workers and prospective employers to inaccurate references, it is perhaps surprising that employers have few legal obligations to provide honest references.
If an employer is reluctant to provide a positive reference, they may be tempted to not provide one at all. Sometimes this will be the best option: the employer does not openly criticise a former employee, the worker is not burdened by a poor report and prospective employers are free to draw their own inferences.
However, there are limited instances where employers may be obliged to provide a reference. In Australia, there is some judicial support for the implication of a contractual term compelling employers to provide references. If it is usual practice in an industry to provide them, and the worker is unlikely to find work without one, the courts might imply such a term. This will, however, be highly context-specific and there is certainly no blanket legal duty on employers to give references.
Once a reference is given, employers may be liable under defamation law if it is inaccurate and damaging. An aggrieved worker might seek damages, or injunct the employer from making further defamatory statements. Employers can avoid liability by being honest and fair in their assessment of the worker, and only making negative statements supported by objective evidence. Provided the negative reference was not given for reasons of malice, the doctrine of qualified privilege will provide a strong defence to defamation lawsuits.
While a prospective employer has no protection under defamation law for damagecaused to them by a false-positive reference, they may be able to sue for negligence. Employers might owe a duty of care to anyone who is likely to suffer damage as a consequence of (both negative and positive) misstatements in an employment reference, which would encompass the worker and possible future employers. This is certainly the legal position in Britain where one case saw an ex-employee successfully sue a company for negligence following the provision of a damagingly inaccurate reference.
The legal position is unsettled in Australia – although some courts have endorsed the British approach, differences in underlying law means the question remains open. Until then, employers would be well-advised to ensure they are fair, honest and take reasonable care when providing employment references.
It is not uncommon for an employer and employee to agree upon a reference if the employment relationship breaks down and the employee exits by way of a settlement deed. These references are typically positive or neutral, and might not reflect the employer’s true sentiment. If Australian courts do establish a duty to provide accurate references, employers could be in breach of that duty by giving a false-positive, albeit agreed, reference.
It is difficult to reconcile these competing concerns, and while the law remains unsettled, employers are in an uncomfortable position. As it is far harder to attach liability for omissions than positive statements, where possible, employers should only include objectively verifiable statements in an agreed reference.
While several legal risks arise when organisations give employment references, they can be mostly mitigated through common sense. Provide accurate information, do not defame former employees and keep any negative comments to oral communication. If these precautions are followed, references need not be a risky business.Read more
Newspaper readers love scandal, and employment disputes can be particularly scandalous. As the widely-publicised litigation between Channel Seven and Amber Harrison demonstrates, the airing of workplace grievances in open court can be damaging to all. Unfortunately for media-shy employers, the principle of open justice – that litigation must be open to the public – is an essential feature of the Australian judicial system.
There are exceptions to the open justice principle. Most courts and tribunals have power to issue suppression, anonymity and pseudonym orders. For example, the Fair Work Commission can ‘de-identify’ (or hide the identity of) parties, order closed hearings, restrict attendance and prohibit the publication of evidence. These orders can be granted where the Commission is “satisfied that it is desirable to do so because of the confidential nature of any evidence” or “for any other reason”. The Federal Court and state courts have similar powers.
Yet despite the scope of its powers, the Commission (and various courts) have been particularly hesitant to abrogate the open justice principle in the employment setting. The 2014 case of Corfield is illustrative. After an employee had sought an anti-bullying order, the employer applied to the Commission to conceal the identity of the parties. The employer submitted that “the publication of the name of the applicant and respondents in what is essentially a private and confidential matter will not be conducive to good governance of the respondent employer”.
Given the employment relationship was ongoing, the respondent argued that a de-identification order was appropriate. Commissioner Michelle Bissett didn’t agree. The submissions of the employer were insufficient to overcome the “presumption… that a hearing will be conducted in public”. She concluded: “Mere embarrassment, distress or damage by publicity is not a sufficient basis to grant such an application.” While this is not an insurmountable hurdle, it does require the employer to demonstrate compelling grounds.
There are other ways to minimise the likelihood of employment disputes descending into trial by media. If an employee is exiting in a situation which may turn acrimonious, ask them to execute a Deed of Release in return for a small ex-gratia payment in addition to their termination entitlements. Not only does this prevent the employee from commencing litigation (at least in theory – some disgruntled ex-employees have been known to try suing regardless), but the Deed can also include a confidentiality provision. This restrains either party from disclosing the terms of the Deed or related circumstances, and a breach entitles the affected party to sue for damages.
Such Deeds can include non-disparagement obligations. These often require that “the parties must not disparage each other”, with disparage defined as “any negative statement, whether written or oral, about either party”. Non-disparagement provisions are common in settlement agreements between commercial disputants, but can also be used in the employment context.
Such clauses are no panacea. Particularly aggrieved employees may not agree to a Deed of Release, preferring to chance their arm before the Fair Work Commission or a court. And if the employee breached the confidentiality or non-disparagement provisions, (public) litigation would be required to seek damages – defeating the very point of the clause. However, in our experience once a Deed is signed and the employee has left the organisation, such steps rarely become necessary.
Judicial luminary Michael Kirby once wrote: “An unfortunate incident of the open administration of justice, is that embarrassing, damaging and even dangerous facts occasionally come to light.”
This sentiment may be cold comfort for human resource professionals trying to protect their organisation’s reputation. It only underscores, though, the importance of effectively managing the termination process to ensure that an employer’s dirty laundry is not aired on the front page.
John Wilson is the managing legal director at Bradley Allen Love Lawyers and an accredited specialist in industrial relations and employment law. He thanks Kieran Pender for his help in preparing this article.Read more
“Discriminatory dress codes remain widespread… the existing law is not yet fully effective in protecting employees from discrimination at work.” — Report of a British House of Commons Joint Committee.
In 1977, the British Employment Appeal Tribunal heard an unusual complaint from an aggrieved bookseller. Austicks Bookshops in Leeds had a policy that prohibited female workers from wearing trousers. One employee, Ms Schmidt, refused to comply. She was dismissed, and subsequently brought proceedings on the basis that the employer’s policy constituted sex discrimination.
In rejecting Ms Schmidt’s claim, Justice Nicholas Phillips recognised the expansive powers of an employer to determine appropriate dress code in the workplace. “As a general proposition,” he opined, “an employer is entitled to a large measure of discretion in controlling the image of his establishment, including the appearance of staff, and especially so when, as a result of their duties, they come into contact with the public.”
Read in 2017, the judgment in Schmidt seems rather antiquated. Certainly, the law has taken considerable steps over the intervening four decades to address such discrimination. Yet the dilemma faced by Ms Schmidt — comply with a sex-specific dress code or be dismissed — lingers to this day. Indeed, just last year professional services firm PwC found itself at the centre of a media storm after an outsourced receptionist in London was sent home for refusing to wear high heels. The furore led to a joint committee inquiry by the House of Commons, which found that clothing related
discrimination remained widespread in Britain and had not been adequately addressed by legislation.
There is no evidence to suggest that the situation is any better in Australia. This is not solely a matter of sex discrimination either. An employer’s ability to regulate employee dress standards, regardless of gender, remains unsettled. Questions of religious discrimination also intrude.
In March 2017, the European Court of Justice found that it was not discriminatory to fire a Muslim employee who insisted on wearing a head scarf contrary to a workplace policy prohibiting visible signs of religious belief. These issues are interrelated. This article will begin by discussing an employer’s power to prescribe and enforce dress codes in the workplace. It will then consider possible legal remedies available to aggrieved employees, located in discrimination legislation and the Fair Work Act 2009 (Cth). Given the paucity of Australian case law in this area, reference to foreign jurisprudence will be made where appropriate.
John Wilson is the managing legal director at Bradley Allen Love Lawyers and an accredited specialist in industrial relations and employment law. He thanks Kieran Pender for his help in preparing this article.Read more
Of hardcore pornography, a United States Supreme Court judge once wrote: “I shall not today attempt further to define the kinds of material I understand to be embraced within that shorthand description; and perhaps I could never succeed in intelligibly doing so. But I know it when I see it, and the motion picture involved in this case is not that.” Putting aside the far less titillating context, much the same can be said of procedural fairness. This amorphous concept is an essential element of employment-related decision-making in the Australian Public Service. Yet procedural fairness is incredibly difficult to define in the abstract.
It also means different things to different people: for decision-makers, it can be a frustrating restraint on the efficient exercise of their powers, while for those affected by an adverse decision the alleged absence of procedural fairness is often a catch-all for any number of grievances. For public servants charged with ensuring procedural fairness, “I know it when I see it” is hardly sufficient.
The concept, an offshoot of natural justice, has ancient origins. A British judge once observed that “even God himself did not pass sentence upon Adam, before he was called upon to make his defence”. For the secular jurist, an early judgment of the Australian High Court drew support from a tragedy by Roman playwright Seneca. Justice Ian Callinan similarly posited: “That no man is to be judged unheard was a precept known to the Greeks.”
Two millennia later, it remains accepted that, absent clear statutory language to the contrary, a government decision-maker intending to exercise their power in a manner that affects rights, interests or legitimate expectations must afford procedural fairness to those affected. In the APS context, this common law duty is supplemented by statute: section 15 of the Public Service Act requires agency heads to establish code of conduct procedures that have due regard to procedural fairness.
What, then, does this entail? To begin with, it is clear what procedural fairness is not. The High Court has repeatedly stressed that “what is required by procedural fairness is a fair hearing, not a fair outcome”. The inverse is also true: a decision might be objectively “right” but can still be invalidated via judicial review if it was made contrary to the requirements of procedural fairness. British courts have summarised that “judicial review is concerned, not with the decision, but with the decision-making process”.
Beyond these exclusions, the concept has two primary components: the hearing rule and the bias rule. The former requires that someone who will be affected by a prospective administrative decision must be heard, whether through oral or written submissions, before the decision is made. Misconduct investigations are an obvious example: it would be grossly procedurally unfair for a decision to be issued without the alleged wrongdoer having an opportunity to make their case.
The second element of procedural fairness demands that a decision-maker be free from bias or any apprehension of bias. This requirement derives from a central legal tenet: a person cannot be the judge in his or her own cause. The decision-maker in a code of conduct investigation could not be the complainant, nor have close ties with the accused. While actual bias is readily identifiable and rarely problematic, the apprehended bias limb often requires closer attention. Decision-makers must ensure that a reasonable bystander would not apprehend the existence of bias from the circumstances.
One difficulty in defining procedural fairness is its context-specific nature. As High Court justice Frank Kitto mused in 1963: “The books are full of cases which illustrate … the impossibility of laying down a universally valid test … ‘the requirements of natural justice must depend on the circumstances of the case, the nature of the inquiry, the rules under which the tribunal is acting, the subject matter that is being dealt with, and so forth.’ ”
However, drawing on my experience acting for public servants in countless APS code of conduct matters, I can offer some guidance. First, procedural fairness requires that specific and particularised allegations of misconduct be put to the accused. It is insufficient to state these at a level of generality: for example, “it is alleged that, over the past 12 months, you have breached the APS code of conduct contained within the Public Service Act, by engaging in a course of conduct that constituted bullying of your colleagues”.
Instead, the particular detail of each and every allegation must be put: “It is alleged that, on June 12, 2017, you said words to the effect of “you are stupid and useless” to John Smith, being conduct amounting to a breach of subsection 13(3) of the Public Service Act because you failed to treat everyone with respect and courtesy, and without harassment.”
The NSW Supreme Court confirmed the need for such an approach in Etherton v Public Service Board. The allegations in that case were provided to the accused in broad terms and accompanied by hundreds of pages of evidence. Justice David Hunt scolded the decision-maker: “It is only by knowing precisely the basis upon which the board has charged the plaintiff that he can properly prepare.”
Decision-makers are also well-advised to adopt a liberal approach to deadlines. In my experience, decision-makers often set artificial deadlines and insist that the accused reply promptly to allegations. In Etherton, the accused was given just three days to admit or deny the charges against him. Other than in the most urgent of cases, such deadlines will be procedurally unfair.
It is apt to end with complementary quotations from two of Australia’s past chief justices. In a 2010 paper, Robert Gleeson observed: “Procedural fairness is part of our cultural heritage. It is deeply rooted in our law.”
Murray Gleeson had previously offered a method to translate such lofty sentiment into practice. “Fairness is not an abstract concept,” he once wrote. “It is essentially practical. Whether one talks in terms of procedural fairness or natural justice, the concern of the law is to avoid practical injustice.”
Procedural unfairness might be hard to define, but judges and lawyers know it when they see it.
John Wilson is the managing legal director at Bradley Allen Love Lawyers and an accredited specialist in industrial relations and employment law. He thanks Kieran Pender for his help in preparing this article.Read more
A recent Fair Work Commission decision has permitted Australian Government Solicitor lawyers and their state or territory counterparts to appear as of right in the industrial tribunal. This is a troubling judgment for a number of reasons, but is particularly concerning for public servants.
Typically, parties can only be represented by a lawyer before the Commission with the approval of a Commissioner. This is because the Fair Work Act jurisdiction is intended to operate in an informal and non-adversarial manner. Until this point, lawyers for both the applicant (say an aggrieved public servant) and the respondent (the government department) would have to state their case as to why they should be allowed to represent their client. While in most cases leave to appear was granted, the Commission retained the discretion to decline representation when appropriate.
Following Gibbens v Department of Immigration and Border Protection, only the employee’s lawyer has to make such arguments. At first glance this is unproblematic; few Commissioners would decline an employee representation when the government is represented by the Australian Government Solicitor. But often employees do not have the finances to procure legal representation. It is now likely that, despite the clear inequity, a public servant might be forced to battle their department and the Australian Government Solicitor. Employees already feel disadvantaged when legally sparing with their employer, let alone when they are unrepresented against the largest employer in Australia with guaranteed legal representation.
Beyond the tangible effect on employees, taxpayers might also be burdened. The Australian Government Solicitor must bid for government work alongside private law firms, to ensure public legal work is done at competitive rates. But departments will now have an added incentive to engage their services over private options, regardless of costs differences.
Given these deleterious side effects, what motivated Commissioner Williams’ decision in Gibbens? Under the Fair Work Act, in-house lawyers – employees of the organisation before the Commission – are excused from the requirement to seek permission to appear. The Department of Immigration and Border Protection argued that, as Australian Government Solicitor lawyers are employees of the Commonwealth, they were effectively in-house counsel for the department.
Commissioner Williams agreed. He observed: “I have considered the submissions of both parties and am satisfied that lawyers of the AGS are entitled, as of right, to represent the Respondent being the Commonwealth of Australia (Department of Immigration and Border Protection) and consequently permission from the Commission is not required.” Commissioner Williams offered no further reasons and did not consider the policy consequences of his judgment. I have already seen other departments seeking to rely on this decision.
Whether the judgment stands is another question. While Commissioner Williams’ interpretation of the legislation is sound, the practical implications strike at the heart of the Fair Work Act’s objectives in this regard. Additionally, the relevant statutory provisions relied upon in Gibbens concerning in-house lawyers hardly represents an accurate description of the Australian Government Solicitor. That agency has to bid for government work alongside other law firms, which is rather inconsistent with being in-house. Yet the likelihood of a public servant appealing the Gibbens precedent is slim – few employees have the funds or desire to challenge such a procedural point of principle.
To further illustrate the issue, departments do have their own in-house lawyers. The Department of Immigration and Border Protection has an extensive legal department. If this is the case, why would any department choose to engage the Australian Government Solicitor’s services over that of its in-house lawyers? Probably because such counsel are not well versed in employment law matters while the Australian Government Solicitor have specialists.
Gibbens leaves public servants in an undesirable position. The odds have always been stacked against public servants in disputes with the government, and department are already spoilt for choice when it comes to legal representation. David against Goliath indeed.Read more
In the popular imagination, workplace injustice ends with triumph on the courtroom steps. Unfortunately, the reality is often less rosy. Many workplace incidents never find their way to courts or employment tribunals, for reasons ranging from cost to complexity. Even when lawyers are engaged, the vast majority of disputes settle before being heard by a judge. Here are three workplace issues that are rarely litigated.
Prior to the landmark 2014 decision in Richardson v Oracle, non-economic damages in discrimination cases (including sexual harassment) were typically limited to no more than $10,000. This provided a considerable disincentive to litigating unlawful discrimination, with legal costs often outweighing the compensation received. While Richardson has changed things for the better – six figure general damages sum are no longer uncommon – it remains that few of these cases see the light of a courtroom.
Beyond uncertainty as to pay-out, three other factors inhibit litigation. Firstly, discrimination claims under federal law must first be taken to the Australian Human Rights Commission, which insists on a cumbersome and often ineffective conciliation process before an aggrieved individual can take court action. Secondly, discrimination laws provide no costs protection, so if the complainant is unable to make their case, they can face hundreds of thousands of dollars in legal fees; government departments rarely use cheap lawyers. Finally, there is a psychological barrier – discrimination (whether age, sex, disability, race or another attribute) can be deeply traumatic, and many victims would rather forget than relive the incident under cross-examination.
There is, though, one positive reason why discrimination matters are not ending up in court. Employers have rightly adopted, and in admirable instances driven, the broader community’s increasing prevalent stance against all forms of discrimination. One effect of this has been stronger internal protections against discrimination through the enforcement of ‘zero tolerance’ policies. Aware of the risk of vicarious liability, many employers have been diligent in stamping out discrimination.
In every jurisdiction around Australia, employers owe a duty to keep their workplaces free from reasonably preventable risks to their employees. For example, work health and safety legislation and regulations require employers to ensure their employees are not subjected to unreasonable risks while at work. Most employers are highly responsive to employee feedback that something in the workplace is unsafe, and will quickly rectify the situation.
But when an employer fails to act, an employee has little scope for recourse. Work health and safety legislation provides no individually-enforceable cause of action for employees; its provisions are typically enforced by the relevant regulator. This means that the right of an employee to sue an employer for breaching their workplace safety obligations typically does not arise until after the fact, once an injury has occurred.
However, if a government department failed to act promptly to reports of workplace hazards, the Public Interest Disclosure Act provides an alternative route to agitate the matter. The whistleblower protection legislation includes within its definition of disclosable conduct: “conduct that unreasonably results in a danger to the health or safety of one or more persons”. In circumstances of “substantial and imminent danger”, disclosure to the media may even be permissible. A paper cut probably does not meet this threshold, though.
As all public servants (should) know, their employment is subject to additional conditions found in section 13 of the Public Service Act: the APS Code of Conduct. Complaints that employees have not upheld their obligations under the Code are usually managed through internal processes, or sometimes outsourced to external investigators. Public servants often complain that these investigations are managed unfairly, with departments regularly failing to comply with their procedural fairness obligations. The allegations are not properly particularised, the decision maker is bias, the accused is not given an adequate opportunity to respond – the list of grievances is endless.
Regrettably for aggrieved public servants, few will possess the financial resources to successfully remedy these errors through judicial review. Not only will the costs of pursing such a claim regularly enter six-figures, judicial review also operates in an ‘adverse costs’ jurisdiction. This means that if the employee loses, they will not only be liable for their own costs bill, but also that of the Commonwealth.
Additionally, there are very limited remedies available to judicial review, with the most common being an order that the decision be remade in accordance with procedural fairness. This means the investigation will be rerun, often leading to the same conclusion anyway. One alternative route is the Merit Protection Commissioner, who can review administrative decisions made within the public service in a variety of circumstances. This avenue is without cost, and the Commissioner can recommend that the original decision be set aside, varied or remade.
John Wilson is managing legal director at Bradley Allen Love. He acknowledges the assistance of his colleagues Robert Allen and Kieran Pender in the preparation of this article.Read more
Discrimination against disabled workers continues to occur at a disheartening frequency, causing undue harm to society’s more vulnerable and depriving the workforce of valuable human capital. Most cases emerge as a result of management’s inadequate understanding of their obligations under the Commonwealth Disability Discrimination Act 1992, which applies to public and private employers across Australia.
The object of the DDA is to promote equality and eliminate discrimination on the ground of disability. Proper compliance with its provisions will allow all parties to reap the benefits of productive employment, while avoiding inevitably Pyrrhic litigation.
In the employment context, the central obligation under the DDA is that an employer must make all reasonable adjustments to ensure that their employees with disabilities can carry out the inherent requirements of their job. They must make those adjustments up to the point that it would cause them unjustifiable hardship — a high bar. If, once the employer has made those adjustments, the employee still cannot perform the inherent requirements of their job, only then can the employer “lawfully discriminate” against them because of their disability by, for instance, sending them on leave without pay or terminating their employment. These obligations also apply to prospective employees.
To determine the point at which the hardship caused by the reasonable adjustments becomes “unjustifiable”, all relevant circumstances must be taken into account. For guidance, the DDA sets out a list of non-exhaustive factors, including the costs of making the adjustments and the financial circumstances of the employer.
It is difficult to conceive of circumstances where an employer with the resources of the federal government could successfully argue that a non-fanciful adjustment would cause it unjustifiable hardship. That is not to say such circumstances would not exist where some inherent characteristic of the disability would prevent the person from carrying out their job. Where managers are faced with a situation involving an employee with a disability that may affect their performance at work, the preferred approach would be to: 1) determine what the “inherent requirements” are of the pre-adjusted position; and then 2) look to the adjustments that could be made to permit the employee to perform them.
The case law provides colourful illustrations of what constitute the “inherent requirements” — or essential duties — of a position: it is an inherent requirement for a worker at a pharmaceutical plant to have a tolerance to penicillin; it is an inherent requirement for a pilot to be under the age of 60 (most countries prohibit older individuals from flying in their airspace); and it is an inherent requirement for a soldier to be able to bleed without the risk of infecting their comrades with HIV. In each of these cases, the courts held in favour of the employer, where even if reasonable adjustments were made to the point of imposing unjustifiable hardship, the employee would nevertheless be unable to fulfil those inherent requirements, and so each was lawfully dismissed on that basis.
It is easy to envisage more basic examples of inherent requirements that could be fulfilled through making reasonable adjustments. If an employee’s medical condition causes them to fatigue, a reasonable adjustment could be to reduce their working hours. If an employee’s anxiety is triggered by a particular supervisor, a reasonable adjustment could be to change their reporting lines. If an employee’s disability makes their commute to the workplace burdensome, a reasonable adjustment could be to relocate them to a more accessible office. In each example, if the employer was to refuse such adjustments, they would have unlawfully discriminated against the employee, unless they were able to establish that the adjustments would impose on them unjustifiable hardship.
Since 2001, the number of working age individuals on disability support for psychiatric conditions has increased by about 50%, making these issues more salient than ever. They often arise in the context of an employee’s apparent under-performance — invariably sensitive situations that require a delicate balance between protecting the well-being of the employee and maintaining the productivity of the enterprise. If the under-performance may be related to the disability, the matter will be best dealt with at first instance through a medical assessment of the individual’s fitness for duty. The medical assessor, upon request, can provide important guidance on what (if any) reasonable adjustments should be made.
Taking such steps proactively may allow employers to avoid situations such as in Huntley v Department of Police and Justice (Corrective Services NSW), where the employer failed to turn its mind to both the inherent requirements of the position, and the reasonable adjustments that could be made. The court awarded the employee $180,000 in damages, plus interest. Even leaving monetary factors to one side, it is incumbent on all, and particularly APS employees, whose values are enshrined in a statute of their own, to remain cognisant of the heavier hardships borne by others.Read more
Will Application Dismissed – Re CGB  QSC 128
Last week the Supreme Court of Queensland gave its reasons for dismissing an application for a Statutory Will in a $17.3 million dollar estate. The judgement can be found here.
The proposed testator (referred to in the judgement as “CGB”) was based in the Gold Coast area. To preserve the privacy of those involved in the case, the judgement was handed down in de-identified form.
CGB was aged 83 and had been a quadriplegic since he was 40. He had conducted business from his home in Broadbeach before he was moved into an aged care facility in Robina. He had never been married, had two children and an estate worth $17.3 million. Interestingly, he had only recently made contact with his two children in the last 4 years.
The Courts dismissal of the application means that unless an appeal is brought, or a new application is made (and held to be successful), the proposed testator’s two children are set to inherit their father’s estate on intestacy.
The application for the Statutory Will was initially bought by the proposed testator’s accountant, who later discontinued proceedings due to a potential conflict of interest. A litigation guardian was subsequently appointed.
The draft Will was proposed included a number of legacies to certain persons (including his children and a charity, namely, the Spinal Research Institution Ltd).
During the trial, the Court heard evidence from a number of persons including:
The reasons for the Court’s judgement
The Court was required to examine whether the proposed Will “…is or may be a Will….that the person would make if the person were to have testamentary capacity” (s 24(d) of Succession Act 1981).
The Court distinguished the Queensland Succession Act 1984 from the NSW Succession Act 2006 which requires that the proposed Will “is, or is reasonably likely to be, one that would have been made by the person if he or she had testamentary capacity” (s22(b) Succession Act 2006).
The Court stated that in the Queensland legislation, the use of the word “may” “suggests a lower evidential base to satisfy the test”(at 105).
The Court was influenced by the fact that in the proposed testator had twice instructed lawyers about drafting a Will. In both instances, his lawyers stated that it was difficult for the proposed testator to commit to instructions.
Ultimately, the Court was not convinced the proposed Will was one that the proposed testator would have made had he had testamentary capacity. The Court referred to the case of Re Fenwick (which is the leading case in NSW on Statutory Wills) stating that that Court should not simply presume that the proposed testator did not wish to die intestate. If the Court believes that the testator didn’t propose to make a Will at all, then the provisions of clause 24 (d) are not satisfied.
The Court held that the proposed testator was indifferent to dying intestate. The Court commented that he intended to make a Will at some point, and took steps to consult a solicitor, but that he was “ambivalent about whether he did make one or died intestate” (at 141).
The Court also looked at the fact that eligible applicants would be entitled to bring Family Provision Applications if they were left without adequate provision on the proposed testator’s death.
The judgement is a lengthy one, and the application was possibly prejudiced by the terms of the proposed Will (specifically, the number of legacies contained in the proposed Will). Even though the application failed, the Court ultimately ordered that all parties’ costs in the proceedings be paid out of the proposed testators on an indemnity basis, which was quite a generous order.
If you need advice about your will or are involved in a will application, please contact our Estate Planning team to for more information.Read more
A recent New South Wales Court of Appeal case, Feldman v GNM Australia Ltd, considered whether correspondence between parties, prior to the execution of a formal settlement deed constitutes a binding agreement.
The case concerned defamation proceedings brought by Rabbi Feldman against GNM Australia Pty Limited (GNM), the publisher of the Guardian newspaper.
In February 2015, a number of articles were published on the Guardian’s website about Feldman and evidence he gave to the Royal Commission into Institutional Responses to Child Sexual Abuse. Feldman served a concerns notice on GNM pursuant to section 14(2) of the Defamation Act 2005 (NSW) (Concerns Notice). In response, GNM through its solicitors sent an email offering to remove the articles from its website and publish a statement made by Feldman, if Feldman agreed to release GNM of all liability. The email stated that “[a]n agreement reflecting the above would be documented in a Deed of Release which would also include obligations of confidentiality”.
Subsequent correspondence passed between the parties. On 30 April 2015, GNM’s solicitors confirmed GNM’s acceptance of settlement terms outlined in the parties’ correspondence in an email attaching “a draft deed of release documenting the parties agreed terms”. Neither GNM nor Feldman executed any settlement deed. Further correspondence between the parties ensued, largely relating to the confidentiality requirements under the agreement.
On 7 July 2015, Feldman’s solicitors wrote that their client had withdrawn “his offer to settle the matter”. Feldman subsequently commenced defamation proceedings against GNM and the author of the articles. GNM sought a permanent stay of proceedings, contending that the parties had a concluded settlement agreement as at 30 April 2015. The primary judge, McCallum J found in favour of GNM.
Feldman sought leave to appeal. The key questions answered on appeal were whether:
Did the email correspondence constitute a binding agreement?
A contract will fail for incompleteness if an essential or important term is not agreed. Feldman submitted that as at 30 April 2015, the parties did not have a binding agreement because the following terms were incomplete:
Generally, where negotiating parties decide on terms of a contractual nature and agree that the subject of their negotiation is to be dealt with in a formal contract, the agreement will fall into one of the following four categories:
In Feldman, Beazley P highlighted that the above categories “are neither strict nor prescriptive. Nor are they exclusive nor necessarily exhaustive. Rather, they describe circumstances in which a finally binding contract may or may not have come into existence.”
GNM submitted that the contract between the parties as at 30 April 2015 fell into the First Category or Fourth Category.
The Court held:
In summary, the email correspondence did not constitute a binding agreement.
Do solicitors have ostensible authority to bind a client to a contract where litigation is not on foot?
Determining whether or not a person has ostensible authority usually involves an inference based on a representation made by the principal (in this case the client) that the agent (in this case the solicitor) has authority to contract within the ambit or scope of the ‘apparent authority’.
As a general rule, solicitors do not have ostensible authority to bind their clients to contracts. An exception to this rule is in the context of litigation. In the context of litigation, a legal practitioner has ostensible authority to bind their client to a contract provided that the contract “actually and genuinely relates to the litigation”.
In this case, a majority of the Court held that Feldman’s solicitors did not have ostensible authority to bind their client to a contract. Three key factors informed this decision:
Feldman has since been cited with approval by:
What is a deed of settlement?
A deed is a special type of contract. It sets out the legal obligations that the parties agree to be bound by; in short, what the parties can and cannot do to finalise a dispute (of any kind) and/or ensure a future dispute does not arise. A deed of settlement is used to bring an end to a litigious matter or current court proceedings on clearly defined terms. A deed of release is often used in an employment context to ensure the parties’ rights and obligations are recorded in a document.
One of the key differences between a normal contract or agreement and a deed is the issue of consideration. Consideration is an essential element in a contract. It means something for something, and is variously defined as “the price for which the promise of the other is bought” or “a price in return for the promisor’s promise or a quid pro quo. The price can be in the form of an act, forbearance of promise.” It can include the act of performing a term or terms of an agreement in the reliance or expectation of all other terms being satisfied. Consideration is not required for a deed. This is because a deed is intended to record the parties’ solemn intentions to be bound by its terms and that in itself is sufficient.
Some basic similarities with contracts will still be applied, especially in relation to construing its terms. A court will usually interpret the deed using the plain, everyday meaning of the words used in the document in the event there is a dispute.
Consider the following two situations:
In order to answer these questions, we explore what a deed is and what you can expect it to contain, and some words of caution when you may be in a position to need one.
Most law firms and lawyers will rely on their pro forma deeds, amended as necessary to fit the situation. However, the below are some key elements which can be found in most deeds of settlement.
Parties: Who agrees to be subject to the deed and bound by its terms. Whilst it may seem obvious in some circumstances as to who the parties should be, sometimes it is not so simple. Should the directors of a company be parties to the deed, even if the directors personally weren’t part of the court proceedings? Can the other side demand that all of your subsidiary companies be included when the dispute wasn’t specifically about them? This will depend on a case by case basis.
Recitals: A brief background to the dispute set out in dot points. This section should set out succinctly and usually chronologically any facts the parties agree are relevant for the purposes of the deed. If it is to settle a current court case, it may include expressly that the parties have agreed to enter into the deed “without any admissions” and to avoid the time and cost of further litigation.
Definitions: The key words or phrases used throughout the deed to ensure consistency and readability. A common definition is “Business Day”, which is usually a day on which trading banks are open for ordinary business in the chosen state or territory. Whilst some definitions are straightforward, care needs to be taken to define any settlement sums clearly, including whether they are inclusive of GST or any other taxes, interest, legal costs and disbursements.
Settlement/ Release/ Indemnity: The terms the parties actually agree to do (or not do) from the moment of exchange. These terms are sometimes used interchangeably, however, as their names suggest, they mean very different things. Deeds may have one or all of these components.
As stated above, a settlement will usually be used for a disputed matter. Key terms will include who will do what, and when they will do it; for example, Party A will pay Party B the “Settlement Sum” (which should be set out in your definition section) within ten business days of the date of the deed. Party B will agree to never commence court proceedings or any type of claim in respect of the circumstances which gave rise to the payment.
A release means that past, present and future claims will be limited or discharged in some way; usually they are ruled out in their entirety. In an employment context, if an employee accepts a voluntary redundancy, the employer will want to be released from any liability including, for example, unfair dismissal. By the same token, an employee could require a release from any actions arising from their employment such as negligence.
An indemnity is a type of insurance for future loss or damage. One party agrees to take on the risk of the other party for damage that may occur as a result of a certain event occurring. Be careful that you are not indemnifying a party for acts or events entirely outside your control well into the future.
Default: What happens when a party does not adhere to the terms of the deed. A good default clause will include a detailed process that needs to be followed in the event a party fails to fulfil its obligations, starting from giving notice of the default. An example for non-payment of an instalment agreement is that the balance of the amount becomes due and payable immediately. The consequences of a default will necessarily be different for each party, so any possible contingencies will need to be considered.
Confidentiality: The parties cannot disclose the terms of the deed unless required by law. Most deeds will include a standard confidentiality clause. Depending on how widely it is drafted, it may range from being unable to discuss the exact terms or even as far as being unable to disclose the existence of the deed itself. An exception to confidentiality includes when a party sues for breach of deed in the event of default.
Applicable laws: The jurisdiction to interpret and adjudicate the terms of the deed. An ACT matter where both parties reside in the Territory and the facts all arose in Canberra will usually nominate ACT laws and courts to hear any dispute relating to the deed. This can become complicated when there are national or even international issues which played a part.
Entire agreement: The terms set out in the deed comprises the full conditions by which the parties agree to be bound. This means any prior negotiations and agreements will be superseded, and this is why you want someone with serious drafting skills to capture all the necessary components without making it an overly onerous document.
Execution: The official signing of the deed, usually prefaced with a statement to the effect that it is “executed by the parties as a Deed”. A company will need to execute a deed in accordance with the Corporations Act 2001, by its directors or a director and company secretary. An individual will need to “sign, seal and deliver” the deed, which nowadays means signed before a witness who is not a party to the deed.
Exchange: One party’s executed deed is given to the other party/parties, and vice versa. A deed may be executed in counterparts and this is usually provided for expressly. This means the parties will sign separate but identical copies of the same deed, which together form a single binding document. These days, lawyers often exchange deeds electronically, by sending scanned copies of the signed deed by email. You should ensure that the copies exchanged are identical documents, rather than a previous version which has since become redundant.
Some notes of caution
To collectively answer the questions posed in the opening scenarios, as shown above, a deed is a complicated document which can have serious legal consequences. When used properly, it can be a valuable document for any party. It is always worth getting a lawyer’s opinion early on, or even to review the terms of a deed to ensure that you are not signing away your rights.
If you need legal advice or require assistance in drafting a deed, please contact us.
 Pollock on Contracts (8th ed, 1911), p 175.
 Beaton v McDivitt (1987) 13 NSWLR 162, 168.
 Section 127.
 Limitation Act 1985 (ACT) sections 11 and 13.Read more
Bradley Allen Love offers a range of seminars and workplace training tools which can be tailored to your workplace and interests. Gabrielle Sullivan, Director – Employment & Workplace Relations, recently spoke at the Australian Medical Association equipping practice managers and HR professionals with the fundamentals of employment law, noting that even large corporations manage to get the basics wrong.
Click here to view the presentation: A Guide to Compliance with the Fair Work ActRead more
It goes without saying that when you are hired to market a property, you will find out as much as you can about it to ensure you can find a buyer or a tenant — whether that is information about the house’s design and construction, an understanding of its location and potential price or insider knowledge about the neighbourhood.
One thing that might not be considered is whether the house has been used for illegal activities and whether these activities have had a lasting impact on the property. Attention to these factors has become important recently with the rise in the creation and consumption of a drug called methamphetamine, which has almost tripled since 2011.
Methamphetamine (also called ice or meth) is a highly addictive drug that is made or ‘cooked’ inside properties, which leads to contamination. This contamination has considerable consequences for any current and prospective inhabitants, as well as the condition of the property itself. For example, in 2016 the Courier Mail reported that a family who had purchased a house in rural Victoria had discovered their six year old son had the same levels of methamphetamine in his body as an adult drug abuser, just by living in the house. The family sued the local council for not disclosing the activities.
The chemical fumes that are a by-product of the drug seep into plaster, paint, carpet, the walls, furnishings and the floor, and it is very difficult to remediate — properly decontaminating the house can require completely gutting a property to a shell and in some cases it can be cheaper to demolish. In New Zealand, meth contamination has become such a problem that home insurers like IAG have recently increased premiums and excess levels.
All agents need to be aware of what kind of property they are marketing and whether they need to disclose that some kind of illegal activity — such as meth cooking — has taken place in the property.
A failure to disclose methamphetamine contamination may result in an agent being liable for misleading or deceptive conduct. Indeed, in 2016 in New Zealand a family sued an agent who sold them a meth contaminated house. It is likely that methamphetamine contaminated houses will be seen as ‘stigmatized properties’ — if an agent sells such a property without disclosure they may be open to large fines.
Finding out that a house is being used for illegal activities is likely to be difficult. Some signs of meth contamination can include burns, rust in unusual places like doors and windows, strange smells and stains, and yellowed walls. It may also be prudent to include a section regarding awareness of illegal activities on a client questionnaire when you are first engaged. It may then be necessary to make further enquiries to ensure no misrepresentations are made.
It is clear that smoking meth ruins lives, but the cooking of meth ruins houses.
If you are concerned about what you should or should not disclose, please contact our office for advice.Read more
There is little doubt that we still live in “death denying” community where talking about death is considered an uncomfortable and taboo topic.
Consequently, too few people express their wishes with regards to their burial during their lifetime. Add into the mix the highly emotional time following the death of a loved one and it is only natural that disagreements and disputes arise between family members over a loved one’s burial plans.
Disagreements and disputes can vary from where the person is to be buried, whether they are to be buried or cremated, and who is to be invited (or uninvited) from the memorial service. Disputes are more likely to arise where:
Disputes regarding the disposal of body are unique in that there is usually no “compromise” that could satisfy all parties.
A testator cannot dispose of something which he or she does not own. A corpse is not considered “property” (Williams v Williams (1882) 20 Ch D 659) and therefore cannot be subject to property offences such as being seized or stolen.
Contrary to common belief, wishes and directions set out in a Will regarding burial or cremation are precisely wishes. They are not binding on the testator’s executor or enforceable at law. At best, they offer guidance to the executor and to the family and are morally binding.
Where then does the law stand with regard to the disposal of body?
Where there is a Will , the executor (and if there is more than one, then the executors jointly unless contrary intention is expressed in the Will) has the right and responsibility to arrange for the disposal of the deceased person’s body.
Where there is no Will, then the person with the highest rank to apply for a Grant of Representation in that jurisdiction has the same rights as an executor. This of itself might cause disputes as there may be disagreement as to who ranks has priority ranking to apply for a Grant of Representation (say for example, in the situation where the children of a deceased person deny that the deceased’s girlfriend was his legal “de facto” partner).
The principles regarding the disposal of body were discussed in a fairly recent case of Darcy v Duckett in the NSW Supreme Court. This case had to consider both the principles in law, and also traditional Aboriginal law.
Mr Darcy died intestate leaving 4 children from one relationship and another 4 children with his de facto partner. He was born in Gulargambone (NSW) and was part of the Aboriginal Weilwan tribe. He had also been living on and off with his de facto partner at Bowraville (NSW). Ms Darcy’s sister insisted that he be buried on Weilwan country and his de facto partner wanted him buried in Bowraville.
The common law principles regarding the right to dispose of a body were summarised by the Court (referring to the case of Smith v Tamworth City Council (1997) 41 NSWLR 680):
The Court had regard to the views of the indigenous community. The Court ultimately held that de facto partner had a superior claim for administration of Mr Darcy’s estate and also had superior right based on Indigenous laws and traditions.
Different rules apply to persons who are members of the defence force or armed services who die while on service. Special rules also apply for deceased destitute.
Further, where the deceased has expressed or implicitly requested not to be cremated, those wishes must be taken into account (s 20 Cemeteries and Crematoria Act 2003 (ACT)).
There are two takeaway point from the Darcy case:
The best way avoid a dispute is to make sure you have a valid will in place that clearly sets our your wishes. Please contact our Estate Planning team to learn more.Read more
On 29 June 2017, the ACT Government introduced the Planning and Development (Lease Variation Charges) Determination 2017 (No 1) through which the ACT Government seeks to improve the efficiency and transparency in the ACT planning system, but more particularly the application and codified value of Lease Variation Charges (LVC). The changes brought in under the Determination will apply to development applications submitted after 1 July 2017.
Under the Determination, the codified value of LVC’s relating to GFA increases under commercial and industrial Crown Leases and additional dwellings under residential Crown Leases has been amended. The more controversial of the changes has been the increased LVC payable on variations required to enable unit titling on residential land.
Under the former LVC determination, if a developer were to submit an application to vary a residential Crown Lease to specify that 5 dwellings were permitted on the land, the LVC payable would have been the sum of $32,500 (being, $7,500 for the first 3 dwellings plus $5,000 for each additional dwelling). The new Determination however, sets a flat fee of $30,000 per dwelling meaning that the LVC payable (for applications submitted after 1 July 2017) will now be $150,000.
 Planning and Development (Lease Variation Charges) Determination 2017 (No 1), Explanatory Statement.Read more
Co-operatives are organisations that are owned, controlled and used by their members primarily for the mutual economic, social or cultural benefit of those members. Co-operatives are founded on seven international principles that empower and educate their members and promote community participation and support; they are values-based entities, albeit ones which can turn a profit for their members.
It seems only right that the ACT Government finally introduced the Co-operatives National Law (ACT) Act 2017 (“CNL”); a move which shows its co-operation with the other Australian State and Territory Governments and which delivers comparable rights and obligations of companies.
Co-operatives are prolific around the world. There are approximately 2.6 million co-operatives in the world with about 1 billion members. In Singapore, about 25% of the population is a member of a co-operative, with about 1.4 million members. New Zealand co-operatives represent approximately one fifth of NZ’s economy based on revenue with (again) approximately 1.4 million members. Co-operative enterprises employ 250 million people worldwide and generate over 2.2 trillion USD in turnover all while providing member benefits.
Co-operatives are found in all sectors of the economy including agriculture, banking and finance, housing, insurance, retail, healthcare, aged care and education. The CNL reduces the regulatory burden and reporting requirements to allow co-operatives in Australia (and now Canberra specifically) to stay agile in an increasingly global economy. So what are these changes?
Historically, co-operatives have only been able to trade in the jurisdiction it was registered in unless it also registered as a ‘foreign co-operative’ in other jurisdictions (i.e. the other States and Territories). The CNL relieves the administrative burden of multiple registrations and reporting and allows for mutual recognition of co-operatives, delivering a simplicity that has been afforded to companies registered under the Corporations Act 2001 (Cth) for over 16 years.
Small co-operatives are no longer required to lodge publically available accounts with the Registrar or appoint an auditor to have their accounts audited annually, saving time and money. Small co-operatives will however still lodge an annual return with the Registrar, and, may (as best practice or out of a specific membership concern) conduct an audit. These new measures under the CNL will provide significant costs savings for small co-operatives and align with the financial reporting requirements on small companies under the Corporations Act 2001 (Cth).
The CNL also provides for a hybrid security called “co-operative capital units”. Co-operatives can issue these units to non-members anywhere in Australia allowing co-operatives to raise external capital without compromising member rights and democratic control.
Co-operatives are a fascinating and sustainable business model, particularly in an age of corporate social responsibility and social enterprise. The CNL represents a supportive legal framework to secure the co-operative identity and better equip co-operatives to grow their businesses.
If you want to discuss the implications of the CNL, contact Katie Innes.
 Source: International Co-operative Alliance
 Source: Cooperative Business New Zealand
 Source: International Co-operative Alliance
 Small co-operatives must not have raised funds from the public issue of securities or if it issued shares (no more than 20 members and the amount raised must not exceed $2 million in 12 months) and they must satisfy two of the three criteria:
a) the consolidated revenue of the co-operative and the entities it controls (if any) is less than $8 million for the previous financial year;
b) the value of the consolidated gross assets and the entities it controls (if any) is less than $4 million at the end of the previous financial year;
c) the co-operative and the entities it controls (if any) had fewer than 30 employees at the end of the previous financial year.Read more
If you have been forced into a transaction because of the actions of another, that transaction may be set aside in certain circumstances. The doctrine of duress is well established, and works to protect parties who have been forced into an agreement by the illegitimate pressure or threats from the other party, by giving rights to the aggrieved party to void transactions.
In order to establish a claim for duress, a party must demonstrate that:
But what about circumstances, for example in a commercial transaction, where one party is exerting legitimate pressure on the other? Can legitimate pressure, which is lawful, cease to be a normal incident of commercial transactions and amount to duress? Or should prospective plaintiffs rely on the statutory protections afforded by the Australian Consumer Law?
While the law in this area is continuing to develop, we may be given a clearer picture soon.
In the upcoming months, the High Court of Australia will hear an appeal in the matter of Kennedy v Thorne  FamCAFC 189. This will see the High Court examining the enforceability of a prenuptial agreement insisted upon by one party prior to the marriage; in essence, the consideration will be whether the conduct in that context, whilst lawful, may nevertheless have been illegitimate.
Justice Edelman, newly appointed to the High Court, has worked extensively in the field of restitution, which encompasses the concept of duress. With Thorne v Kennedy being His Honour’s first opportunity to deliver a judgment in the field of restitution, it seems likely that this opening act will cast significant light on the scope of duress. Whilst Thorne v Kennedy will be heard in a family law context, the ramifications to the general commercial law may nevertheless be significant.
The courts have recognised that unlawful conduct, such as threats to a person or threats to detain another’s property, is illegitimate. For instance, if a salesman said to you “Buy this pen for $1,000 or I will beat you up”, the resultant transaction could be voided, on the ground that you only entered into the transaction because of duress. However, what amounts to duress from seemingly ‘lawful’ commercial pressures is still controversial. Watch this space insofar as Thorne v Kennedy may provide clarity in the near future.
Threats are often made in commercial contexts to compel another party into action:
“I won’t supply to you”
Will threats of this nature be considered duress, despite the fact that they are ‘legitimate’? Several courts have considered the extent to which commercial pressures can and should constitute “economic duress”.
In the leading authority in this area, McHugh JA stated that pressure will be illegitimate if it consists of unlawful threats or amounts to unconscionable conduct. However, he left the category of “economic” duress (that is, conduct that is not unlawful) open, only to say that overwhelming pressure, which does not amount to unlawful conduct, will not necessarily constitute duress.
For instance, Company A might say to Company B that they will not supply to them unless Company B agrees to some onerous conditions. Despite the pressure that may be applied, there may not necessarily be a case for duress, as the conduct is not unlawful. What is clear from the case is that, to constitute duress, a high bar has been set.
The phrase “economic duress” has become used frequently, but remains frustratingly undefined, and subsequent courts have been reluctant to interfere with commercial dealings. In Equiticorp Finance Ltd (in liq) v Bank of New Zealand the issue was revisited. In that case, the Bank of New Zealand requested of the chairman of the Equiticorp companies that cash reserves be applied to the discharge of a debt owed to the Bank. It was found that the Bank was asserting commercial pressure, but this pressure did not amount to economic duress.
Kirby P (in dissent) was critical of the inherent vagueness of economic duress. His Honour stated that there needed to be more clarity as to what conduct amounts to economic duress (and is not allowed) and what conduct does not.
While the law in this area is developing, there remains some relief in statute. For example, the Australian Consumer Law prohibits conduct that is “unconscionable”, a concept which can bear many similarities to economic duress. Through this, conduct may not necessarily be unlawful, but may amount to that which ought not to be permitted in commercial dealings.
Since the introduction of the Australian Consumer Law in 2010, there have been various authorities dealing with the question of unconscionable conduct. This begs the question, is it necessary to have both this and “economic duress”? Considering the uncertain nature of economic duress, it seems that relying on statutory protection would be an easier course. Indeed, the NSW Court of Appeal came to a similar conclusion in Australia and New Zealand Banking Group Ltd v Karam.
The main point from all of this is that the law of economic duress is continuing to develop, both through the courts and through legislation. Is there a place for both a common law doctrine of economic duress and statutory prohibitions against unconscionable conduct? The hope is that Kennedy v Thorne will shed some light and provide guidance on the issue; however, until the matter of “economic duress” is resolved, the statutory measures offered by the Australian Consumer Law should be followed at the minimum.
 Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40, 45-6 (McHugh JA).
 Ibid 19 NSWLR 40.
 (1993) 32 NSWLR 50.
 Ibid 106.
  NSWCA 344.
Our business and commercial litigation teams have experience with cases of duress and assisting clients set aside transactions which they have been forced into. If you are concerned because you may have entered into an agreement on account of duress, and wish to know your rights, please contact us.Read more
A recent decision in the NSW Civil and Administrative Tribunal highlights the importance of thinking carefully about whether information constitutes personal information that may be protected by the Privacy and Personal Information Protection Act 1998 (NSW).
In CRP v Department of Family and Community Services it was found that, in the particular circumstances of the application before the Tribunal, an individual’s work address was personal information that was protected by the Act.
Following an incident in which a Departmental employee released the applicant’s work address to an estranged family member, the Tribunal has definitively stated that, in these circumstances at least, doing so amounted to a breach of privacy.
Given how easy it can be to reveal seemingly harmless information, this case demonstrates how important it is to be careful with any information that might be considered to be personal information.
The applicant was employed with the Department of Family and Community Services. He was estranged from his father, with whom he had a long-running personal dispute. The applicant’s father phoned the office without identifying himself. He requested, and received, the address of the applicant’s workplace: previously, he had only known the name of the organisation for which his son worked.
Following this, the applicant’s father went to the son’s place of work, where he confronted him and handed him some documents.
The son – the applicant in the proceedings, argued that through the Department’s actions, his personal information had been shared in breach of the Act.
The Tribunal considered whether the applicant’s work address was information ‘about an individual’ for the purposes of s4 of the Act. If so, by providing the information, the employee had breached ss 17 and 18 of the Act. The respondent argued that it was not, as this was information that had been shared within the normal course of business, as part of the applicant’s work. The Tribunal, however, found that this was not the case.
In coming to its decision, the Tribunal considered the findings of several previous Tribunal decisions saying that the definition of ‘personal information’ was to be interpreted broadly and that the Tribunal should not adopt an overly technical approach. Instead, the Tribunal said that it was important to consider the information that was provided in context.
Ultimately the Tribunal decided that the information had been provided in a context that solely related to the applicant. At the time, there had been no indication that the phone call was made in connection with the applicant’s work, or as part of his role as a caseworker. No other information was requested. By giving out the applicant’s work address, the Department’s employee provided personal information about him, and as a result breached his privacy.
As a result of this breach, the Department was ordered both to apologise to the applicant, and to review its current Privacy Management Plan. However, this case could evidently have significant general consequences. While providing a work address for a co-worker may seem harmless, as we have seen here, the results can be serious.Read more
A few weeks ago we wrote about the Victorian Court of Appeal recognising the rights of de facto children in the case of Scott-Mackenzie v Bail. The case concerned an applicant whose mother was in a domestic relationship with the deceased for 40 years until the mother’s death years prior to the deceased’s death. The applicant bought a claim under Part IV of the Administration and Probate Act 1958 (Vic) in a (bold and successful) attempt to widen the Courts interpretation of “Step Child” to including one where the parties were not married.
This case was handed down in May this year.
Queensland has now followed by recently introducing major changes to the Succession Act 1981 (Qld).
Two major changes include:
The “movement” towards highlighting the changing familial values in Australia all started with the Western Australian case of Blyth v Wilken  WASC 486 which was only handed down very recently in 2015 and at the time, this was truly a landmark decision of its kind Will in Australia.
In the case of Blyth v Wilken, the deceased left a Will dated 2 December 2003 giving the bulk of his estate to “my de facto wife Katherine Mary Murray”.
The deceased and Ms Murray ended their relationship in 2011 and the deceased subsequently died in 2014 without changing his Will.
The Court decided that Ms Murray did not receive the gift under the Will because her relationship with the deceased had ended. The Court recognised that the deceased had only intended Ms Murray to receive the gift if she continued to be his de facto spouse – and not in any other instance. In other words, the Court held de facto relationships on the same platform as marriages when it came to the interpretation of a Will.
At the time the judgement in Blyth v Wilken was handed down, there was a lot of scepticism by commentators that this judgement would be appealed or otherwise challenged in the future.
With Victoria and Queensland following the trend towards recognising these relationships, it may be safe to say at this stage that other Australian jurisdictions are likely to follow down the path of recognising de facto and step children’s rights.
To make sure that your will and estate plan takes care of your loved ones, please contact us.Read more
15 June 2017 was World Elder Abuse Awareness Day — a day designated by the United Nations General Assembly to raise awareness on the potential mistreatment and abuse inflicted on members of the elder community.
As the number of older persons continues to steadily increase among the Australian population, so does the risk of elder abuse.
The World Health Organisation defines elder abuse as:
“a single, or repeated act, or lack of appropriate action, occurring within any relationship where there is an expectation of trust which causes harm or distress to an older person. Elder abuse can take various forms such as physical, psychological or emotional, sexual and financial abuse.”
World Health Organisation (WHO – 2002)
It is apparent therefore that elder abuse can take a number of forms and is not just limited to financial or psychological abuse.
Various studies (primarily conducted in Victoria, Queensland and New South Wales and which were based mostly on anecdotal evidence) suggest that it is more common than we realise.
The available evidence suggests that prevalence of elder abuse varies across different types with physiological and financial abuse being the most commonly reported types of abuse recorded. Women are more susceptible to elder abuse than men. There has been no reported study conducted in the ACT on elder abuse to date.
On an international level, the United Nations estimates that based on the available information, 5 to 10 per cent of the elderly population may experience some kind of financial exploitation.
Very broadly, some warning signs of elder abuse might include the following:
Part of raising awareness of World Elder Abuse Awareness Day includes understanding and being able to recognise the signs of Elder Abuse.
Early last year, the Australian Law Reform Commission (ALRC) launched a national inquiry and on Thursday 15 June 2017 (to coincide with World Elder Abuse Awareness Day) released its final report on the topic.
In its report, the ALRC has urged the Federal Government to seize a “once in a lifetime opportunity” to stop the financial and physical abuse of the elderly. The report contains 43 recommendations for the Attorney-General, George Brandis, to consider. The recommendations include:
Be aware, raise awareness and know how to recognise (and when to report) Elder Abuse
Recognise the warning signs in the older person, in the caregiver, in the home and among family. The majority of abusers are those in close contact with the older person and usually family. Of family member abuses, about 50% are reported to be adult children and 20% to be intimate partners of the older person. As mentioned above, the data indicates that women are more susceptible to elder abuse than men.Read more
Below is a short case study around the importance of reference checking, and what can happen if you don’t keep accurate records.Read more
It is a well-established employment law principle that a worker must follow the lawful and reasonable instructions of their employer.
A recent decision of the Federal Court in Grant v BHP Coal has upheld the dismissal of a worker for refusing to undergo a medical examination by a company-nominated doctor. A Queensland boilermaker, who had undergone surgery for a work-related shoulder injury, was cleared by his GP as “fit to return to normal duties” after 8 months’ sick leave. His superintendent directed him to see a company-nominated occupational physician to assess his fitness before he resumed work. The worker refused and was eventually sacked.
The Court did not have to consider whether an employer has an implied contractual right to order a worker to undergo a company medical examination (in the sense that it was not an unlawful direction and, accordingly, fell within the scope of the contract of employment). Here, the broad obligations under Queensland’s coal mining legislation for mine safety and management applied and makes it clear that a mine worker could be required to undergo a medical examination in cases where there might be a risk to the safety and health of the worker and other mine workers because of his injury.
The case does not stand for the general proposition that every direction by an employer to a worker to attend a medical examination with a doctor chosen by the employer will be reasonable. Whether such a direction is reasonable will depend on the circumstances of each case. For example, a worker may only have been sick for a short period of time, or may have already given sufficient information to their employer about their illness. In this circumstance, it is unlikely that a direction to attend a specific doctor would be reasonable.
If an employer was uncertain of a worker’s health status and had genuine concern as to their fitness to perform their job safely, a lawful direction to the worker to attend a medical assessment could be given as it could be argued that there is a genuine and legitimate operational reason for doing so.
Employers have strict and onerous obligations to ensure the health and safety of their workers while at work. Because of these obligations, various courts and tribunals have recognised, in some circumstances, an employer has a right to compel or demand a worker attend an independent medical assessment so they can determine the worker’s fitness for their duties. Any refusal by the worker to do so may expose them to the risk of disciplinary action up to and including dismissal.
An employer cannot exercise this right arbitrarily; they have an obligation to provide “procedural fairness” in the particular circumstances of the case. This includes the employer giving the worker adequate notice of the medical appointment that they require them to attend. Furthermore, procedural fairness also requires that the worker be allowed the opportunity to secure their own medical opinion if they do not agree with the opinion provided by the employer’s doctor.
The doctor conducting the assessment should be provided with a thorough description of the work duties to enable them to assess appropriately whether or not the worker’s disability, illness or injury will affect their ability to undertake those duties. The medical assessment will consider whether the worker is medically fit to perform the inherent requirements of their job and if any adjustments could be made to the role to enable the worker to perform their position. It would be unreasonable for an employer to embark on a “fishing expedition” by asking unnecessarily broad questions of the doctor, such as asking for a complete medical history when the medical issue is more confined.
The short answer is NO.
The federal government’s Merit Protection Commissioner has recently ruled on a “secret medical” on a paper-based assessment from a doctor of a public servant who had not been informed that his mental health was being examined. The public servant had not worked since 2011 as a result of claimed bullying and harassment suffered whilst employed by the Department of Human Resources. A doctor’s report was commissioned to assess work fitness and was done without the public servant’s knowledge or consent. The Commissioner found that the Department breached its legal obligations when it handed the public servant’s medical file to the doctor asking for an assessment. The Commissioner’s office ordered the Department to discard the “file assessment” on its employee finding that it failed its legislative requirement to act in a fair and reasonable manner.
The short answer is NO.
The current advice on the Fair Work Ombudsman’s website is:
Employers attending medical appointments
We don’t consider it reasonable for an employer to go to a medical appointment with an employee unless an employee requests this.
We also don’t consider it reasonable for an employer to contact the employee’s doctor for further information.
Source reference: Fair Work Act 2009 (Cth) Section 107
 Grant v BHP Coal Pty Ltd  FCAFC 42 (10 March 2017)
 “’Secret medicals’ on public servants unlawful, authority rules”: The Canberra Times 16 March 2017, page 8Read more
Imagine you are a cook. You just landed your dream job as a personal chef. You arrive at your employer’s home ready to impress but receive a message saying your employers will dine out. You take the wages left on the kitchen bench and leave disappointed. The same thing happens again every day of your first week of work until, finally, you snap, threatening to resign unless you are given an opportunity to cook. Your employer replies: “Provided I pay my cook her wages regularly, she cannot complain if I choose to take any or all of my meals out.”
These words, quipped by judge Lord Cyril Asquith, reflect a general rule developed by British courts in the mid-19th century: an employer has no obligation to provide their employees with work. Why, though, you might joke, would an employee ever ask their employer for more work?
Imagine a month passed and you still haven’t cooked for Asquith. Deciding enough is enough, you interview for a new position and are asked to prepare a steak. You overcook it. When employees are denied the opportunity to perform the job they were hired for, they will lose skills – whether those are the skills of a chef or a capable public servant. This old rule is particularly concerning in the modern era, when the job market is competitive and prospective employers almost always want details of a candidate’s experience.
Public servants are among those who might feel this most acutely because their employment, promotions and performance reviews depend heavily on meeting performance targets and metrics. It is easy to see how an Australian Public Service career could be derailed when a public servant is denied work. Additionally, given it is difficult to terminate government employment, some managers might be tempted to simply stop giving their employees work instead.
Fortunately, the courts are sympathetic to employees in this predicament. Numerous exceptions were developed to address the problems arising from this rule, typically taking the form of implied terms in employment contracts.
First, the courts have held that employment contracts for public performers – including actors, sport stars or even cartoonists – impliedly require the employer to give their employee reasonable opportunities to perform. However, given few people conduct their careers in the public eye, the value of this exception is limited.
Second, courts have found that contracts for skilled employees contain a limited requirement to provide a reasonable amount of work. This exception applies to apprentices, trainees and professionals with continuing practice obligations (it’s not the first time lawyers carved out an exception for themselves). However, this caveat is not a blanket obligation to provide work – as Arnold Mann, a surgeon in Canberra, discovered in 1981 when the court found his employer was not required to provide him with patients to operate on when no patients needed operations (Mann v ACT Health Commission).
Third, when an employee receives performance-based pay, courts have found employers must provide a reasonable amount of actual work. This exception most commonly applies to employees who receive a proportion of their pay from commission. The amount of work an employer is required to offer will depend on the circumstances, but, generally, courts have found the obligation is to provide enough work to give them an opportunity to earn a commission.
Fourth, when an employee is appointed to perform specific duties, courts have found that a failure to provide work of the kind contemplated amounts to a breach of contract. For example, if it is contrary to the contract of a chief executive to undertake general office cleaning, it follows that it is also against their contract to not have work at all. This is highly relevant in the APS, given federal government employees are frequently employed to positions with well-defined duties and obligations.
There are other reasons why these rules are particularly applicable to public servants. APS employees must adhere to obligations found in the Public Service Act’s code of conduct. It is unclear how these obligations might affect the general rule’s application in this context. The code could be interpreted as a two-way street: if the public servant must perform work effectively, then the public service must provide work to be effectively performed. Alternatively, if a public service manager fails to give an employee work, the manager may breach the code by failing to ensure “effective performance from each employee”. The employee could then lodge a code of conduct report against their manager.
An extra option open to an employee who finds themselves denied work is to pursue a complaint under workplace bullying and harassment protections. Though legally speaking these protections are not exceptions to the general rule, practically workplace bullying and denials of work can go hand-in-hand. There are several remedies available to bullying victims, including stop bullying orders. If it is accepted that denying an employee work constitutes bullying, it follows that a stop bullying order could take the form of an order to provide them with work.
It would be fair to question the purpose of this old rule if judges are going to find exceptions at every turn. The High Court itself has expressed similar sentiments. In 2005, justices Ian Callinan and Dyson Heydon queried “the current relevance of judicial pronouncements made more than 60 years ago in the United Kingdom”.
Given the right case, it is possible Asquith’s quip will be overruled. But, until that time, a little piece of Dickensian England remains part of Australian employment law. Indeed, employees asking for work might feel a little like Oliver Twist asking the master for more gruel.
John Wilson is the managing legal director at Bradley Allen Love Lawyers and an accredited specialist in industrial relations and employment law. He thanks Robert Allen and Kieran Pender for their help in preparing this article.Read more
The Victorian Court of Appeal recognised earlier this month in the case of Scott-Mackenzie v Bail that stepchildren of a de facto couple have the same rights as of married couples for the purposes of Family Provision Applications. The effect of this case is significant (at least in Victoria, for now) as it overturns the common law principal that a stepchild/step-parent relationship is created and recognised only when the parties are married.
The case concerned a claim brought by a stepchild pursuant to Part IV of the Administration and Probate Act 1958 (Vic). Part IV of the Act allows an “eligible person” to bring a claim for provision (or further provision) from the estate of a deceased person. The definition of eligible person, contained in section 90 of the Act includes the following:
(c) a stepchild of the deceased who, at the time of the deceased’s death, was—
(i) under the age of 18 years; or
(ii) a full-time student aged between 18 years and 25 years; or
(iii) a stepchild with a disability;
In this case, the applicant’s mother was in a domestic relationship with the deceased for 40 years until the applicant’s mother died in 2001. Following the death of the applicant’s mother, the deceased commenced a domestic relationship with another woman and when he died, left his entire estate to her. The estate was worth just under $1 million.
The Court stated the following in relation to the word “stepchild”:
“In modern life, domestic partnerships are no longer uncommon. They have become considerably more common than they were, say, 30 years ago. Domestic partnerships can, and frequently do, have all of the appearances of partnerships that are marriages and have been recognised by the Parliament as a legitimate alternative to marriage. The fact that the word ‘stepchild’ came into existence at a time before domestic partnerships became more common explains why definitions have previously referred to either an original marriage and a subsequent marriage, or merely a subsequent marriage”.
It is important to note that the Court found the stepchild/ step-parent relationship of de facto couples is broken by separation of the couple, not by death of one of the partners. Therefore, if the deceased and the applicant’s mother had separated before her death, the stepchild/ step-parent relationship would have been broken.
It is important to note that this is a Victorian case and therefore, Victorian law. It is uncertain whether the ACT or NSW Supreme Courts will apply this case should a similar situation arise. In Queensland, section 40A of the Succession Act continues to refer to a stepchild/step-parent relationship as one arising only by way of marriage.
The takeaway from this case is that you may need to carefully consider children from a de facto partner when writing your Will or, if you are the child of such a relationship, to take considered advice in relation to any potential family provision claim.
To make sure that your will and estate plan takes care of your loved ones, please contact us.Read more
Whether you are moving to Canberra as an employee or employer, your future employment relationships are likely to be at the forefront of your mind. In 2009, significant changes were made to Australia’s industrial relations law which will affect those relationships. Given strong penalties are awarded for non-compliance, it is important that you are familiar with your rights and obligations under Australian employment law.
Here are five things you need to know:
1. National Employment Standards
With very few exceptions, workplaces in Australia are governed by the Fair Work Act 2009 (Cth). Therefore, it is likely your future employment in Australia will be subject to the National Employment Standards (NES) contained in that Act. Covering areas from maximum working hours to leave, these 10 entitlements represent a minimum standard that no employment contract can fall below. Failure to comply with these standards can leave contractual terms voidable and result in considerable penalties being awarded against the employer.
Pay is central to every employment relationship and Australia has a famously generous national minimum wage – $17.70 per hour in 2017. But this is not the end of the story. Under the 2009 changes, the wages received by many employees are determined by industry awards. These set base pay rates for an industry according to the nature of work undertaken and frequently exceed the national minimum. Award rates are updated regularly (every six months in some industries), so it is essential to regularly check the applicable award.
3. Unfair Dismissal
Employers should be cautious of, and employees familiar with, the right of a recently dismissed employee to make an application to the Fair Work Commission arguing that their dismissal was harsh, unjust or unreasonable. If the Commission agrees, employers may be required to reinstate the employee or pay them compensation. What constitutes a harsh, unjust or unreasonable dismissal will depend on the circumstances. Employers can also be found liable under these rules if they handle a dismissal in an improper manner, even if there is a valid underlying reason for the dismissal.
4. Adverse Action
In keeping with Australia’s strong stance against discrimination, Australian employees are protected from the “adverse actions” of their employer if those actions were taken due to certain protected attributes possessed by the employee. In other words, an employer is liable for discrimination on the basis of a protected attribute – including gender, sexuality, disability and race – even when those actions would otherwise be legal (for example, terminating employment contracts). As with unfair dismissal, employers may face severe penalties from the Fair Work Commission for breaching these protections.
Due to Australia’s federal structure, many employment relationships attract obligations under Commonwealth (or federal) legislation as well as state/territory statutes. In many instances, these obligations are concurrent. Under Australian industrial law, rights and obligations can even arise for employment contracts executed overseas. Employers (and their employees) should be aware of these jurisdictional traps.
John Wilson is the managing legal director at Bradley Allen Love Lawyers and an accredited specialist in industrial relations and employment law. He thanks Robert Allen for his help in preparing this article.Read more
The Federal Government has announced changes to superannuation from 1 July 2017 that will affect many individuals. As we draw closer to 1 July, more and more people are seeking advice on how the changes will affect them and specifically, what the changes mean to their existing wills and estate plans.
The Federal Government has imposed a $1.6 million balance cap on the total amount that a member can transfer into a tax-free pension phase account from 1 July 2017. This will mean that from 1 July, many members will need to transfer a significant portion of their superannuation benefits into accumulation phase, which will attract the superannuation 15% tax on income generated within the fund, including capital gains.
How will the member’s family and their estate be impacted when the member dies? Consider the situation where a husband and wife each have $2 million in pension phase. The husband and wife each execute binding death benefit nominations to leave their super to the other. The husband subsequently dies.
Traditionally, the wife could maintain the benefits within the superannuation environment by commencing a death benefit pension and subsequently commuting the pension (after the relevant period of time, known as the 3 month/6 month rule, and provided the super fund deed permitted this to take place).
From 1 July however, things will need to change. The following would need to occur:
Once the funds are out of the superannuation environment, contribution limits and the “work test” may prevent the wife’s ability to recontribute funds back into superannuation.
Auto-reversionary pensions offer some relief and flexibility by not causing a debit to the recipients transfer balance account until 12 months after the death of the member. As a result, a reversionary pensioner has 12 months decide whether to cash out their pension or retain it.
The estate planning issue is then where should this lump sum withdrawal be paid. It will be necessary to review and update estate plans including Wills and binding death benefit nominations in light of these changes:
Make sure you get your estate affairs in order before the changes arrive on 1 July 2017.Read more
Episode one of Pushing the Boundaries are available to watch below:
Mark Love was chosen as a guest panelist, and had the pleasure of reviewing the Kim Harvey School of Dance by Clarke Keller Architects. This particular building also won the Art in Architecture Award at the 2016 Australian Capital Territory (ACT) Architecture Awards.
Internships are becoming increasingly prevalent in the legal sector and elsewhere. While internships can be beneficial for intern and host organisation alike, these atypical workplace arrangements pose several thorny employment law questions. When, as is commonplace, interns are unpaid or only receive a modest ‘stipend’, these dilemmas become particularly pressing.
The foremost question concerns the legal status of the intern. ‘Internship’ is not a legal term of art – it has no meaning at common law or under the industrial relations regulatory landscape created by the Fair Work Act 2009 (Cth). An intern is therefore either an employee, or has no legal relationship whatsoever with the host organisation. There is no middle ground. This article will not consider the status of ‘volunteers’ in this context, although that topic is perhaps deserving of a separate contribution.
Where an intern is objectively considered to be an employee, they are entitled to the minimum wage and basic entitlements as set out in the Fair Work Act, National Employment Standards contained therein and any applicable award or enterprise agreement. Accordingly, organisations who use interns without providing them with the requisite wages and conditions risk exposure to considerable liability – through litigation initiated by either interns themselves or the Fair Work Ombudsman – for non-compliance with the Fair Work Act. This risk has been exacerbated by recent developments.
The Fair Work Ombudsman’s crackdown Concerned by the apparent increase in unpaid work arrangements across the country and perhaps inspired by highprofile internship-related lawsuits in the United States, in 2012 the Fair Work Ombudsman commissioned a report into the phenomenon. In Experience or Exploitation: The Nature, Prevalence and Regulation of Unpaid Work Experience, Internships and Trial Periods in Australia, academics Andrew Stewart and Rosemary Owens found that – despite a dearth of official data – internships are undeniably on the rise. They observed that ‘unpaid work exists on a scale substantial enough to warrant attention as a serious legal, practical and policy challenge in Australia’.
The Ombudsman was quick to respond, and has successfully prosecuted three companies in recent years for utilising unpaid or underpaid interns. In the first case to be determined, Fair Work Ombudsman v Crocmedia Pty Ltd  FCCA 140, Judge Riethmuller penalised a Melbourne-based sports media company $24,000 for an ‘exploitative’ arrangement where two individuals undertook work in return for modest ‘expenses’ payments.
Similarly, in Fair Work Ombudsman v Aldred  FCCA 220, the respondent was ordered to pay $17,500. While these sums may seem modest, Judge Riethmuller sounded an ominous warning at the end of his Crocmedia judgment. There can be little doubt, he noted, ‘that the penalties are likely to increase significantly over time as public exposure of the issues in the press will result in respondents not being in the position of being able to claim that a genuine error of categorisation was made’ (at ). This prediction came to fruition in mid-2016, when the Federal Circuit Court imposed a penalty of almost $300,000 on a media company that had failed to pay an intern for 180 hours of work and committed various other breaches of the Fair Work Act (see Fair Work Ombudsman v AIMG BQ Pty Ltd  FCCA 1024).Read more
Upon implementation of the reforms, Land and improvements duty (often referred to as stamp duty) will not be payable until a transfer of dutiable property has been registered with the Registrar-General. An instrument that gives effect to a dutiable transaction such as a Contract for Sale must be lodged with the registrar-general within 14 days of the date the agreement is completed. Duty must then be paid within 14 days of the date of registration of the Transfer.
This represents a significant change for those purchasing property in the ACT, who will not be required to pay duty until after settlement and registration have occurred. These changes also apply to the purchase of an off-the-plan unit, where duty will not be payable until registration of the Transfer. Currently stamp duty for an off-the-plan purchase is payable within 1 year of entering into the Contract or earlier if the unit is completed. Now you will not have to pay stamp duty until the unit is completed.
How is the stamp duty amount secured?
We assume in practice ACT may adopt a system similar to that in Victoria (where the incoming mortgagee registers the Transfer and attends to payment of stamp duty from the loan amount). Any unpaid duty liability under the new regime will become a secured charge on the property under the Taxation Administration Act 1999, allowing the ACT government to take measures to recover the debt. Accordingly, purchasers will need to ensure they have the funds to pay the duty when the liability arises.
There will also be changes to the application process for exemptions to stamp duty. To apply for an exemption a purchaser must indicate the category of exemption when the Transfer is lodged with ACT Land Titles. The purchaser will not be required to provide supporting evidence unless requested by the ACT Revenue Office. However, as with the current duty model it appears there will be no pre-assessment of exemptions and purchasers must ensure they are able to pay the full duty amount if an exemption is not granted.
If you require specific duties advice or advice regarding a particular transaction, please do not hesitate to contact a member of our experienced Commercial and Real Estate Team.
1. Real Estate Institute of Australia, Real Estate Market Facts December Quarter (2016).
2. Real Estate Institute of Australia, Real Estate Market Facts December Quarter (2016).
3. In the Revenue Legislation Amendment Bill 2016 (No. 2).
Technology has changed the way we live our lives. We have the internet in our pockets, speaking with someone face-to-face in another country is merely a click away and we can order groceries on our fridge. Even the Real Estate industry is not immune to technological change. In 2014, investment worldwide in real estate start-up technology companies amounted to US $1.4 billion and eConveyancing is now or will soon be live in 7 of the 8 Australian jurisdictions.
Continuing this trend, the NSW State Government has passed the State Revenue Legislation Amendment Bill 2017 (the Bill) which has amended the Duties Act 1997 (the Act) to make it clear that a dutiable instrument includes instruments in digital form capable of being reproduced, stored and duplicated by electronic means. This means that digital instruments effecting a dutiable transaction are considered dutiable instruments under the Act and must be lodged with the Office of State Revenue for assessment of stamp duty.
The Bill also brings about further changes to the Duties Act 1997 giving rise to or clarifying exemptions to stamp duty. These include:
The definition of associated persons under the Act has also been extended to include beneficiaries of sub-trusts, allowing the Office of State Revenue to look behind sub-trusts to determine if there are related people involved in a transaction.
Clearly duty legislation in Australia is constantly evolving to suit changing times. Regardless of where your property transactions occur, it is important to obtain up-to-date duty advice to ensure your transaction is not subject to unnecessary or unanticipated costs.
 Tech innovators aim to shale up property industry, The Financial Times (https://www.ft.com/content/e746fbb4-d87b-11e4-ba53-00144feab7de)Read more
Four BAL Directors have been recognised for their legal excellence in the 2017 edition of the Australian Financial Review’s Best Lawyers Australia list. Produced by a peer review company and published by the Australian Financial Review, the list is compiled following an extensive evaluation process. The list includes more than 3000 lawyers from 330 law firms nationwide, up from more than 2850 last year.
The directors have been successful in the following practice areas:
This is the eighth consecutive year the Alan Bradbury has been acknowledged for his expertise. Managing Legal Director John Wilson makes his fifth appearance in the list, while Mark Love and John Bradley were again recognised for their respective practices.
John Wilson congratulated his fellow Legal Directors on their achievements.
“A listing in Best Lawyers is a considerable honour, reflecting as it does the praise of fellow practitioners in each speciality,” he said. “For three of my colleagues and I to be included speaks highly to the calibre of our team at Bradley Allen Love.”
Best Lawyers is the oldest and most respected peer-review publication in the legal profession. A listing in Best Lawyers is widely regarded by both clients and legal professionals as a significant honour, conferred on a lawyer by his or her peers. For more than three decades, Best Lawyers lists have earned the respect of the profession, the media, and the public, as the most reliable, unbiased source of legal referrals anywhere.Read more
Following media discussion in 2016 about comprehensively introducing paid domestic violence leave, the impacts of familial violence beyond the home – particularly in the workplace – are under scrutiny.
Around one in six female workers has experienced or is currently experiencing domestic violence (DV). Many victims of DV experience financial risk or poverty. Financial security, such as stable employment, increases a victim’s ability to leave a violent situation, and gives them a secure financial future independent from their attacker. However, it can be difficult to maintain employment while suffering abuse and its flow-on effects.
DV can impact employment in numerous ways: perpetrators may interrupt workplaces – giving rise to work health and safety issues; victims may need time off work in order to access support services; victims may be unable
to concentrate at work and have performance related issues. Understandably, this can make the employment relationship volatile for both the employee and the employer.
Under the Fair Work Act 2009 employees experiencing DV, or caring for an immediate family member who is experiencing DV, have the right to request a ‘flexible working arrangement’. For example, an employee may request to start work later because they have had to move to a new suburb with poor public transport in order to escape their abuser. Employers are not obliged to agree to requests for a ‘flexible working arrangement’, provided any refusal is based on ‘reasonable business grounds’. For some organisations it would not be possible to have an employee start later because that employee normally opens the shopfront, and the business cannot afford to hire another employee to cover this duty. In general, employees do not have the right to challenge the refusal of a flexible working arrangement unless they are entitled under an enterprise agreement. However, that does not mean that an employer should feel free to refuse all requests. A request for a flexible working arrangement should open up a dialogue between employer and employee to see if they can find an arrangement that is suitable for both parties.Read more
A report released on 20 March 2017 by the Real Estate Institute of Australia (REIA) has found that residential property prices continued to rise in the December quarter 2016 across Australia.
REIA reported 545 sales of residential property in the December quarter in Canberra. In the ACT, the median house price has reached $621,000.00, which is an increase of 5.3% over the quarter and 4.2% over the previous year. The Inner South experienced the largest increase of 7.9% over the quarter and 6.3% over the previous year.
Compared to December 2015, the median house price rose for all Canberra zones but the Inner Central, which saw a decrease of 5.4%.
These figures mean that housing affordability has again worsened in the ACT, with the proportion of income required to meet loan repayments hitting 19.7%.
The median rent for a three bedroom also increased in the ACT to $460.00 per week, which represents a 9.5% increase from the previous quarter and 6.4% annual change.
The median rents for four bedroom houses in Inner South (14%) and Inner Central (12.8%) saw the biggest increases, and median rents generally increased for all sized in all zones except two bedrooms in Inner Central, which decreased by 2.2%. The vacancy rate, however, increased to 2.2%.
Rental affordability consequently has declined in Canberra and 17.6% of a family’s annual income being required to meet rent payments.
Over this same period the price for other property in Canberra decreased by 1.2% to $425,000.00, but it was steady when compared to the 2015 year. The median price for other dwellings increased only in Inner Central, while it dropped as much as 11.4% in the Inner South. There were 365 sales of other dwellings in the December quarter, with the most in Inner Central and the least in the Inner South.
The above figures show that the market has continued to be tightly contested. To stay ahead of the curve, contact BAL Lawyers who can assist you with your property transactions.Read more
Internships and work experience programs are commonplace in many industries. They can provide essential practical training for students and recent graduates, while giving employers a “trial period” in which to assess potential future employees. For less scrupulous companies, interns also represent a limitless pool of free labour. It is not surprising then that responses to an intern survey ranged from “valuable learning experience” to “slavery”.
Regardless of the exact name or shape, all internship programs face legal risks. This is because Australian law maintains a binary conception of employment: an individual is either an employee, and thereby entitled to the full range of employment protections, or not. The current scheme has little room for lesser shades of employment: paid interns, unpaid interns and the like.
It follows that where an employment relationship is objectively considered to exist between a company and an intern, the latter is entitled to pay and other benefits in accordance with the relevant award. Where proper remuneration has not been provided, the company risks legal action from aggrieved interns and prosecution by the Fair Work Ombudsman.
The ombudsman has been pursuing internship cases with vigour lately, successfully seeking a total of over $300,000 in penalties against several companies over the past two years.
Penalties are usually imposed in addition to full payment of entitlements to the interns involved. While some of the penalties paid in early cases – $17,500 in one, $24,000 in another – may not provoke immediate fear, Judge Riethmuller sounded an ominous word of caution in a 2015 case involving media company Crocmedia.
“There can also be little doubt,” the federal circuit court judge observed, “that the penalties are likely to increase significantly over time as public exposure of the issues in the press will result in respondents not being in the position of being able to claim that a genuine error of categorisation was made.” In other words, turning a blind eye to the risks posed by internships will no longer suffice.
Unfortunately, determining as a matter of law how an intern should be classified is fraught with difficulty, as neither case law nor statute offers a clear dividing line between employee and non-employee in this context. An individual’s attendance at a workplace for a matter of weeks in a predominantly observational capacity will not satisfy the criteria of an employment relationship.
Conversely, a three-month program where the intern works regular hours and undertakes productive work in a position indistinguishable from junior employees will almost certainly amount to employment. Where the middle ground falls is unclear.
Herein lies the dilemma: for an internship to be useful for both parties, interns need to be engaging in proper work and not simply sitting around ‘making coffee’. Yet that important characteristic is the very thing that exposes companies to risk. As the ombudsman explained: “Where the arrangement involves productive work rather than just meaningful learning, training and skill development, it is likely to be an employment relationship.”
The obvious solution is to employ interns on a fully award-compliant basis – that is, to engage the individuals as short-term employees. However, in many cases this defeats the purpose and leaves little incentive for prospective employers to run such programs.
A more comprehensive way to avoid these legal risks is to take advantage of the vocational placement exception in the Fair Work Act. This excludes from the Act’s coverage individuals undertaking unpaid work as a requirement of an authorised educational or training course.
Aligning an internship program with a local school, university or training college would therefore be a prudent risk mitigation strategy. While such an approach may limit flexibility, this seems a small price to pay to ensure a legally compliant scheme.
If the current oversupply of graduates in many professions continues, internships may become even more commonplace. In this context, companies need to tread carefully in devising and operating their own internship programs. When the various pitfalls are minimised, internships can be a valuable experience for both parties. Offered without due regard to the legal risks, an attempt to attract free labour can become very expensive.Read more
2017 could prove to be a landmark year for a previously neglected aspect of Australian workplace law. Where those who blew the whistle on corporate or public sector wrongdoing once faced retribution without legal protections, recent developments have underscored the need to comprehensively safeguard whistleblowers in this country. While the sentiment expressed by former NSW Police Commissioner Tony Lauer in the 1990s may still reflect the prevailing attitude in Australian workplaces, change is afoot.
Late last year, in a political deal between the Coalition and crossbenchers to pass the double dissolution trigger legislation, strong protections for union whistleblowers were introduced. As part of the pact, the government also agreed to review public and private sector whistleblower protections with a view to enacting reform by 2018. In January 2017, the first ever case under whistleblower provisions in the Corporations Act 2001 (Cth) was filed against Origin Energy by their former compliance lawyer.
If the applicant is successful, the implications for corporate Australia will be far-reaching. Elsewhere, the Public Interest Disclosure Act 2013 (Cth) — although far from perfect — has helped facilitate the reporting of public sector misfeasance and corruption by federal mandarins since coming into force in 2014. Improvements in this vexing field will inevitably be slow and controversial. It took two decades, six parliamentary inquiries, and a number of unsuccessful bills before the Public Interest Disclosure Act was finally passed. But with apparent domestic political will for greater whistleblower protections and impetus from developments in foreign jurisdictions, there is room for optimism — and a need for external lawyers and in-house counsel alike to be aware of the regulatory landscape.
This article will begin by exploring the history of whistleblower protections in Australia, before considering three relevant laws which protect whistleblowers in different sectors. It will then consider the strategic utilisation of whistleblower legislation in employment litigation and the potential applicability of foreign laws to Australian whistleblowers, before concluding with a discussion of expected developments in the coming years.Read more
Many people, especially individuals and small businesses, may be familiar with the ACT Civil and Administrative Tribunal (usually referred to as the ACAT or Tribunal). With their focus on early alternative dispute resolution and proactive case management, the ACAT hears claims in a wide variety of areas, most notably civil disputes residential tenancy, mental health and unit titles claims.
In December 2016 several changes were made to the Tribunal’s powers. The main change was an increase in the civil disputes jurisdiction of claims to $25,000, a significant increase from the previous maximum of $10,000. The ACAT website states the increase is to “ensure that the civil dispute jurisdiction of ACAT continues to be able to address the needs of the Canberra community.”
A few months in, does it look like parties to an ACAT civil claim have benefitted from the changes? Below, we explain the updated procedures, crunch some numbers and provide our insights into how this may affect you.
To accommodate the widening of the ACAT’s jurisdiction, new procedures have been adopted to progress claims in a timely and cost-efficient manner. For contested claims up to $3,000, a Conference and Determination process has been implemented. The Tribunal will list the matter for a preliminary conference, with parties to file all material prior to the conference. If the matter is not resolved at the conference, it will usually be scheduled before a different ACAT Member on the same day for hearing.
For those bringing claims over $15,000, the Tribunal may use the Conference and Evaluation process. Parties will be required to submit a case summary and position summary prior to a preliminary conference being held. If the dispute does not settle at the conference, the matter will proceed to a directions hearing where a timetable will be set to take the matter to hearing.
Both processes are intended to assist in:
One of the other changes affecting the civil claims includes the requirement for Presidential Members of the Tribunal to be eligible as Magistrates. Other interstate tribunals also employ a judicial head, so it remains to be seen whether this will change the culture of the ACAT, as some fear it may.
Reasons for changes
The dual purpose in raising the maximum jurisdiction was to:
It remains to be seen whether the increase in jurisdiction will see a larger number of matters being filed in the Tribunal rather than the Court. Between July 2014 and June 2015, 1997 matters were lodged in the civil jurisdiction of the Magistrates Court. In comparison, the Tribunal’s 2015-2016 Annual Review, published a month before the changes were implemented, indicated a general downward trend in the number of civil dispute applications lodged as follows:
Existing matters in the Magistrates Court which now fall into the Tribunal’s jurisdiction can also be transferred to the Tribunal on application by either of the parties. If the Court considers it to be the interests of justice to transfer the matter, it will make that order accordingly.
The jurisdictional increase also brings the ACAT more in line with its interstate equivalents. For example, since May 2014 the NSW Civil and Administrative Tribunal (NCAT) has determined consumer claims up to the value of $40,000, an increase from its previous limit of $30,000. In Victoria, the VCAT Civil Claims List can hear disputes for any amount of money that arise out of the purchase or supply of goods or services of any value (noting the claim must have a connection to the state of Victoria).
The jury is out
The change in the civil claims maximum to $25,000 took many by surprise. Whilst most had been expecting an increase, the 250% jump was far more than would be considered a proportionate increase in line with inflation.
The move clearly had community support and good policy reasons behind it. However, the increase has also put more pressure many Tribunal users, especially sole traders and small businesses which regularly provide goods and services for under $25,000. As mentioned above, until recently the ACT Magistrates Court had jurisdiction of matters between $10,001 and $250,000. One of the key differences between the Magistrates Court and Tribunal is that the Tribunal is a “costs-free jurisdiction”, meaning that parties to an application must bear their own costs, including legal costs, unless the Tribunal otherwise orders.
Therefore, whilst a litigant could previously have expected to recover their legal fees along with a sizeable debt of, say, $20,000, this is no longer the case. Except in special circumstances, legal fees will have to be worn by the claimant, or they may consider prosecuting a claim without lawyers. Despite the Tribunal’s aim to be friendly to self-represented litigants, running an ACAT case from start to finish is often a daunting prospect for most.
It remains to be seen whether the ACAT can handle the increased number of claims which have trickled down from the Magistrates Court, whilst upholding its key “cheap and fast justice” function. Watch this space for a full review when the annual figures are released. In the meantime, if you need help with an ACAT claim, or have any questions about your options, please contact Litigation. Bradley Allen Love assists clients, whether claimants or respondents to an application, in preparing their cases, advising in relation to required evidence and legal points which may arise as part of the claim, and can support or attend the Tribunal as required.
 ACT Magistrates Court Annual Review 2014-15, from: http://www.courts.act.gov.au/__data/assets/pdf_file/0005/971321/act_magistrates_court_annual_review_2015.pdf.
 Consumer Claims Regulation 2014 (NSW) regulation 4.
 ACT Civil and Administrative Tribunal Act 2008 (ACT) section 48.Read more
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:
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.Read more
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.
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.Read more
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:
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.
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.
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.
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).
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.
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.Read more
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.
Kelly v Jowett  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”.
First published in Ethos.Read more
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.”Read more
Despite the fact that people care more about the result of the final Saturday in September than the goings-on in Parliament, the AFL does not wield governmental power (though the AFL might wish otherwise). How then did James Hird allege that he was denied procedural fairness when the question of whether he breached the rules was determined? While those proceedings were ultimately discontinued, it raises the question of whether procedural fairness applies to private organisations.
Historically, procedural fairness has been a common law right that applied only to governmental powers that, when exercised, negatively affected the rights or interests of an individual. Where certain decisions are made, procedural fairness operates so that the decision must be reached in a fair manner.
More recently, the courts have begun to expand the role of procedural fairness and have applied it to companies and private organisations. The classic example of decisions affecting individuals is where members or employees are suspended or terminated (e.g. for supplying performance enhancing supplements).
The key procedural fairness principles to keep in mind are:
The hearing rule has an added benefit, in that it can give the decision maker advance warning of the defence to be made and highlight any weaknesses in their own case.
So why does procedural fairness apply to private organisations? For government decisions, the duty was implied into legislation, rather than expressly provided for. In much the same way, the duty arises from the rules of the particular organisation being construed on the basis that fair procedures are intended. Express words in the rules can operate to exclude the duty, but if the rules are silent it is likely that procedural fairness will apply.
It is important to remember that the critical question for procedural fairness is not whether the ultimate decision is fair; it is whether it was reached fairly. The best practice is to assume that procedural fairness will apply to decisions that negatively affect the rights or interests of an individual. You should have proper procedures in place so that decisions of this nature are made in a procedurally fair manner; if you don’t play by the rules, you may end up with a decision that does not stand.Read more
The gravity of workplace sexual harassment changed in Australia in July 2014. While at a societal level it has long been accepted that such conduct cannot be tolerated, the law lagged behind. Suing an employer for its failure to prevent sexual harassment was costly and rarely led to a sufficiently large award of damages to justify the financial and emotional expense.
That changed three years ago. The Full Court of the Federal Court’s landmark judgment in Richardson v Oracle Corporation Australia Pty Ltd significantly increased the range of damages available in sexual harassment cases. Compensation in the order of $10,000-$20,000 was suddenly replaced by $100,000 and above, jolting employers into action for fear of costly litigation and significant liability.
The result, to speak generally, has been a greater responsiveness to sexual harassment complaints, more thorough investigations and harsher sanctions (including termination) for perpetrators. For the most part, this cultural change has been rewarded. Two recent unfair dismissal cases have reasserted that serious sexual harassment warrants dismissal.
The applicant in Torres v Commissioner of Police was terminated on the grounds that he had engaged in a pattern of lewd behaviour, particularly with junior employees. His indecent conduct included serenading a colleague with a song about anal sex, bragging about his genital piercings, asking a junior employee “do you want to suck my c*ck” and making vulgar comments about female visitors.
The applicant claimed that this was all “innocent joking”, and not out of place in the particular workplace. He offered: “At work we have a culture, in the police I call you a name and you call me a name, we swear at work and everything and all that they used against me. I do swear at work but so does everybody else”. These comments fell on deaf ears, with the tribunal holding that the dismissal was fair. Neither the fact that he had never received harassment or code of conduct training nor that he was a decorated senior special constable swayed the tribunal.
In Applicant v Respondent, an airline dismissed a cabin crew supervisor after the applicant showed explicit images of a colleague to other colleagues and made inappropriate sexual comments. The cabin crew supervisor, like the police commissioner, pleaded that his actions were in keeping with the workplace culture. He argued that it was “common for there to be discussions of a sexual nature while at work”. These pleas were ignored, and the Fair Work Commission found that the employee’s dismissal was not harsh, unjust or unreasonable.
The above two cases are examples of egregious workplace conduct handled appropriately by the employers, and subsequently upheld by workplace tribunals. Read together, they strongly condemn the use of ‘workplace culture’ as an excuse for poor behaviour and support employers taking swift action in the face of blatant sexual harassment.
However, another recent Fair Work Commission decision is hard to reconcile with this trend. In Renton v Bendigo Health Care Group, Commissioner Michelle Bissett found that an employer was harsh for dismissing a nurse who had tagged two colleagues in a sexually explicit video on Facebook.
Indeed, it is difficult to understand how the actions of the airline employee or senior constable differ wildly in crudity from the behaviour of the nurse in this case. The applicant had shared a video of an obese woman in her underwear ‘dropping’ her stomach onto a man’s back. He captioned this video “[Colleague 1] getting slammed by [Colleague 2] at work yesterday”. The nurse also left tissues and ‘blobs’ of white sorbolene cream on the desk of one of the colleagues tagged in the video, to make it appear — so the employer alleged — that the colleague had been masturb*ting.
The commissioner was initially sympathetic to the hospital, noting that the matter required a “swift and strong response”. Yet given the Facebook incident was a “one-off” and that previous “jokes” along the same theme as the sorbolene cream incident had not given rise to a reprimand, the dismissal was deemed harsh and an order for compensation made.
How are employers to proceed in the face of such contradictory decisions? Notwithstanding Bendigo Health Care, it would be advisable to err on the side of caution. That case seemingly represents an outlier, rather than the rule.
APS departments should adopt a two-pronged approach. HR professionals should ensure strict adherence to the procedures and processes created by the relevant policies, which are designed in accordance with the APS Code of Conduct. At the same time, actions taken should be proportionate and those involved must be afforded procedural fairness. While the administrative apparatus that accompanies Code of Conduct investigation in the APS should, in theory, ensure proportionality and procedural fairness, we see too often that this is not the case.
Sexual harassment is serious issue. Following Richardson, employers — whether public or private — are on notice that such conduct cannot be tolerated, and that the onus is on them to prevent its occurrence in the workplace. Employers must tread carefully when navigating the sexual harassment minefield.Read more
A recent study by the Australian Bureau of Statistics found that approximately 71% of Australians primarily use vehicles to commute and 88% use a car to get to places other than work. Unfortunately, as many as two-thirds of new car buyers have experienced problems with their vehicles in the first 5 years of use. What happens when your hard-earned car is a lemon?
In Australia, consumers are protected by the Australian Consumer Law, contained in the Competition and Consumer Act 2010 (formerly known as the Trade Practices Act 1974), which provides a number of guarantees, including guarantees as to:
These guarantees are implied by law into all purchase agreements for goods priced under $40,000 or acquired for personal, domestic or household use. This includes cars purchased for personal or family use. Whether under warranty or not, cars must comply with certain standards so as not to breach the guarantees. The above two guarantees are explored further below.
“Acceptable quality” means that goods must be safe and free from defects, amongst other things. This encompasses a range of potential problems that could occur with a car, from engine issues to more minor concerns such as appearance. However, this guarantee does not cover defects which the consumer knew about prior to purchase or damage due to abnormal use.
The guarantee as to fitness for any disclosed purpose means that goods will be reasonably fit for:
This provides another, more specialized, layer of protection in addition to the guarantee as to acceptable quality. For example, a car acquired from the dealer for regular family camping trips should be able to handle off-road terrain; the sale of a car which cannot could be in breach of the Australian Consumer Law, despite the car being otherwise in good working order.
Where a guarantee has been breached, the failure to comply with the Australian Consumer Law can be classified as either a major or a minor failure. The remedies available to the buyer differ according to this classification. Whether a failure is major or minor will depend on the circumstances; however, a major failure occurs where:
Cars that undergo multiple repairs may indicate that there has been a major failure to comply with consumer guarantees.
Remedies available include requiring the supplier of the car to remedy the failure (if minor) or rejection of the car, with a corresponding right to compensation. Consumers may also recover damages for any reasonably foreseeable loss or damage suffered by reason of the failure.
So what can you do if you suspect your car is a lemon?
Often these matters are resolved in the early stages without recourse to litigation, but sometimes something more is required to get the solution you need. If you are experiencing difficulties or the manufacturer or dealer is dragging the chain in fixing your car, let us know if you need help. If life gives you a lemon, there are protections available – so don’t settle for lemonade.Read more
In a decision handed down by Moore J on 2 February 2017, the Land and Environment Court has held that the amalgamation of two Councils effectively put an end to a criminal prosecution brought by the EPA for an environmental offence committed by one of the Councils prior to the amalgamation.
The EPA had commenced criminal proceedings against the former Wellington Shire Council on 21 April 2015 for an offence of “causing water pollution” in breach of s.120 of the Protection of the Environment Operations Act 1997. The old Council entered a plea of guilty to the charge but a sentencing hearing for the offence had not been held when, on 12 May 2016, the Local Government (Council Amalgamations) Proclamation 2016 was made. That Proclamation dissolved both the old Council and the former Dubbo City Council and constituted a new Council now known as Dubbo Regional Council.
The Proclamation contained a number of provisions to give effect to the amalgamation, including provisions transferring a range of staffing, financial and legal responsibilities to the new Council. One of those provisions expressly provided that any proceedings relating to the assets, rights or liabilities commenced against one of the old Councils and pending immediately prior to the amalgamation were to be taken to be proceedings pending against the new Council.
Following the amalgamation, the new Council applied to strike out the EPA prosecution. The Council’s position was that clear words would be required in the Proclamation to result in the criminal liability of a former Council being transferred to the new Council. It argued that, in the absence of express statutory provision and clear language, it was ‘inconceivable’ that a legal person not in existence at the time of the alleged offence, could be found to be criminally liable for an offence alleged to have been committed by another person.
The Court accepted the Council’s argument, holding that clear and express language would be necessary to have the effect that criminal proceedings commenced against a former Council could be continued against the new Council. The Proclamation transferring assets and liabilities to the new Council should therefore be taken to have transferred only civil liabilities, not criminal ones.
A second Proclamation was made on 9 September 2016, the Local Government (Bayside) Proclamation 2016. Although the primary purpose of this Proclamation was to dissolve the former Councils of Rockdale and Botany Bay, it also contained a number of amendments to the first Proclamation. One of those amendments was a new provision that expressly transferred criminal liability from dissolved Councils to newly constituted Councils.
Section 736 of the Local Government Act 1993 permits the amendment of a Proclamation by the Governor but expressly provides that, except with the consent of the relevant Council, such an amendment is not to affect anything done before the publication of the Proclamation. The Court found that these provisions meant that the second Proclamation could not have the effect of transferring criminal liability to the new Council unless the new Council had agreed to that occurring, which it had not.
In those circumstances, the Court struck out the prosecution that had been brought against the former Wellington Shire Council by the EPA and the Council was effectively given a ‘get out of jail free’ card.
If you have any questions about Local Government Law, or about the proceedings above, please contact Alan Bradbury.Read more
In a decision handed down on 6 February 2017 the NSW Court of Appeal found that the lessor of goods had failed to perfect their security interest in circumstances where the PPSA applied and, as a result, lost title to $US44 million worth of equipment.
Under the PPSA if a person supplies goods on credit or leases goods then they can (and should) register a ‘security interest’ to protect their ownership of the goods until either (1) the goods are fully paid for or (2) the lease comes to an end and the goods returned. Registering a security interest on the Personal Property Securities Register ‘perfects’ their rights and puts the world on notice that it claims an interest in the goods. The PPSA is about registration; it is no longer about ownership rights.
In this case, on 5 March 2013 General Electric International Inc (GE) agreed to lease four mobile electricity generating gas turbines to Forge Group Power Pty Ltd (Forge Power) for two years. The turbines were delivered and installed to a temporary power station. GE sold part of its leasing business to Power Rental Op Co Australia (Power Rental) and took ownership of the turbines in October 2013, even though the turbines were physically at the Forge Power site.
As luck would have it, voluntary administrators were appointed to Forge Power on 11 February 2014.
Under the PPSA unless you have a perfected security interest, when an administrator is appointed title in goods that are leased by the company can vest in the administrator. At no point did GE or Power Rental register on the PPSR, even though they had approximately 344 days between the start of the lease and the date of the administration to do so.
The administrators claimed that because there was no perfected security interest, and the lease of the equipment was a ‘PPS Lease’ they now owned the turbines (worth approximately US$44 million). In order to get their turbines back Power Rental argued that because the turbines had been fixed to the land, they were not ‘personal property’ and the PPSA did not apply to them.
The Court of Appeal held that the turbines did not become ‘fixtures’ to the land. As the turbines were not ‘fixtures’ the PPSA did apply, the lease of the turbines was a PPS Lease and should have been registered. As neither GE nor Power Rental registered or perfected their security interest, they lost title to the turbines.
If you supply goods on credit or you lease or hire goods then you can (and should) register a security interest – don’t assume you are protected.
If you have any questions regarding the PPSA or the PPSR, contact Katie Innes.Read more
Allegations of misbehaviour must be handled with great care, as a recent case shows. Serious misconduct in the workplace is no laughing matter. It takes effort, though, to suppress a chuckle when reading the recent Fair Work Commission case of Walia v Citywide Service Solutions. Notwithstanding its private sector context, Walia offers a reminder about the care needed when managing code of conduct allegations and provides a timely opportunity to revisit the Australian Public Service’s misconduct process.
The applicant in Walia was employed by Citywide as a garbage-truck driver, operating in the Melbourne CBD. In June 2016, Bobby Walia was midway through a 10-hour shift when a City of Melbourne inspector spotted him urinating in a laneway. The inspector issued Walia with an infringement notice for public urination.
Walia notified his employer of the incident, who were understandably concerned. Walia said he had urgently needed to urinate but found it difficult to park his garbage truck near a public toilet. Citywide determined that, as Walia’s actions were against the law and had the potential to cause reputational damage to Citywide, it would terminate his employment for serious misconduct. Walia promptly sought unfair-dismissal relief.
Commissioner Michelle Bissett began her consideration of the dispute by observing: “There have been many (perhaps too many) decisions of the commission where an employee has had his employment terminated for urinating other than in the toilet.” She held that, while Citywide had a valid justification – “[Walia] provided no cogent reason why he did not stop to go to the toilet before it became urgent” – the dismissal was nevertheless harsh. Termination was “disproportionate to the gravity of the misconduct”, especially given that Walia had immediately self-reported and shown contrition, and that termination would also have an inordinate adverse impact on him. Accordingly, Bissett ordered Walia’s reinstatement.
Had the applicant in Walia been a federal public servant, his misconduct would have been dealt with under the APS code of conduct and the relevant agency guidelines. I have dealt with the minutiae of code disciplinary investigation on many occasions before, and don’t propose to do so again here. The Public Service Commission’s 2015 Handling Misconduct: A Human Resource Manager’s Guide and the Australian Government Solicitor’s 2014 Misconduct in the Australian Public Service legal briefing are both good starting points.
The key takeaway point from Walia, though, is that conduct considered by the employer to constitute serious misconduct does not axiomatically justify termination. While the label “serious misconduct” is often used in the APS context, it must be noted that the term does not appear in the Public Service Act. Notwithstanding the concept’s origins in the common law – and it is well accepted that, absent a legislative framework, an employer can summarily dismiss an employee for a single act of “serious misconduct” where it is fundamentally inconsistent with the continuation of the employment contract – termination on such a basis could still fall foul of the unfair-dismissal protections.
Moreover, it should always be borne in mind that the APS misconduct regime is protective rather than punitive. Sanctioning public servants can only be done to protect the public, maintain proper standards of conduct within the APS and uphold the service’s reputation. Too often, this protective purpose is forgotten in a rush to punish misbehaviour. In the Walia case, the incident occurred in sight of an apartment block, giving rise to a reputational hazard. However, had Walia’s public servant equivalent urinated out of sight behind a corner, imposing anything more than a reprimand would be questionable.
There is, though, one notable exception that deserves consideration. Employees at the Australian Criminal Intelligence Commission, Australian Federal Police and Australian Border Force are all subject to a peculiar provision in their respective originating legislation. Where the agency head reasonably believes that the conduct of a terminated employee amounted to serious misconduct, and this conduct had or is likely to have a damaging effect on the agency’s reputation or staff morale, they can make a declaration. This declaration precludes the Fair Work Act from applying to the termination, such that the terminated employee can’t lodge an unfair dismissal claim or demand payment in lieu of notice.
While the specialised nature of the Australian Criminal Intelligence Commission or the AFP may justify this limitation, its introduction in the Australian Border Force Act means thousands of public servants are now at risk of losing their right to challenge a termination. The explanatory memorandum’s justification was hardly persuasive: … in instances of serious misconduct … the application of the Fair Work Act can impact on the ability of the secretary to both quickly and decisively remove an APS employee … For example, a review of the dismissal that results in the person having to be reinstated may send a mixed signal to the community or the workforce about the tolerance of serious misconduct within the department.
The latter proposition borders on the absurd: an employee would only be reinstated should the commission determine they had not committed the misconduct, or there were compelling mitigating circumstances that make the termination “harsh”. Suggesting this eventuality would be destructive of public confidence in the Border Force is tantamount to arguing that appeal rights in criminal cases should be removed because an overturned conviction undermines faith in the prosecutor’s office.
Thankfully, terminated Border Force staff who are subject to such a declaration can still challenge the misconduct finding (and, indeed, the declaration itself) via judicial review. Nevertheless, this development is deeply troubling, and unlikely to lessen red tape for affected employees – or the public service generally – in resolving nasty workplace disputes.
Managing misconduct is rarely easy, and often reasonable minds will differ on the appropriate response to misbehaviour in the workplace. To some, the decision in Walia might be “taking the piss” and offer yet another example of the Fair Work Commission’s employee-friendly nature; to others, Citywide’s initial handling of the incident would be considered grossly excessive and the ultimate outcome entirely just. For those managing misconduct in the APS, adopting a proportionate and procedurally fair approach should prevent headline-grabbing outcomes like that in Walia.
Does your home and contents insurance policy provide liability cover if you cause injury or death to another person in an accident?
Though most Australians insure their homes, more than one-third do not insure their contents. Contents insurance covers the financial cost of repairing or replacing your household personal possessions and furnishings such as curtains, furniture, white goods, stereo, TV, computers and other electrical appliances, clothing, jewellery, sporting equipment and even toys.
It is important to check that the home and contents insurance includes liability cover to protect against financial loss if your actions or your negligence is found to cause a person to be injured or killed.
The insurance should cover two key financial risks. One is the compensation that you may be ordered to pay the injured party, plus their legal costs if a claim against you is upheld. The second is the legal cost of defending a claim. Ordinarily the level of coverage for all claims from any one incident under contents legal liability cover should be at least $10 million including all associated legal costs. Some policies will provide coverage of up to $30 million for public liability.
The importance of checking your home and contents insurance cover was recently highlighted when the ACT Supreme Court ordered a cyclist to pay nearly $1.7 million in damages to a fellow cyclist who was knocked off his bike and hit by a car when the cyclists side by side collided on their way home from work.
At the time, the cyclists were riding on a major road in a designated cycling lane after dark. The wheel of the offending cyclist struck a wooden stake lying on the cycle-way. The accident occurred during the evening peak hour in winter when there was adequate lighting; which the court found would have allowed the offending cyclist to see the wooden stake. The primary judge found that the offending cyclist should have seen the wooden stake in adequate time to take evasive action had he been keeping a proper look out for objects on the cycle-way.
The offending cyclist appealed the decision that he had breached his duty of care and caused injury and financial loss to his fellow cyclist on the grounds that the findings against him were based on inadequate evidence about flawed lighting, and that expert evidence was required to show that he failed to exercise reasonable care. He also argued the primary judge did not properly explain his reasons for finding the accident was avoidable. The ACT Court of Appeal found that none of the challenges to the primary judge’s findings were supported by the evidence. Special leave to appeal to the High Court was refused.
The subsequent publicity surrounding the case, as it was widely reported in the Canberra media, resulted in an increase in the membership of the local cycling group Pedal Power ACT which automatically provides insurance coverage for its members.
Fortunately, the negligent cyclist had insurance protection under his general home and contents insurance policy which provided liability cover for his fellow cyclist’s injuries. Certainly, cyclists should have insurance protection against liability to others, in their own interest as much as for the victims of anyone they negligently injure. Whilst this may be a benefit of membership of a local cyclist organisation, it is prudent to check whether this coverage exists as part of a home and contents insurance policy.Read more
“Sunlight,” eminent American judge Louis Brandeis once mused, “is said to be the best of disinfectants.” Yet while transparency is now a popular political buzzword, Australia remains an unfriendly place for those who dare to let the light shine on corruption and maladministration. The words of former NSW police commissioner Tony Lauer – that “nobody in Australia much likes whistleblowers” – continue to ring true.
While the enactment of the federal Public Interest Disclosure Act in 2013 introduced long overdue protections for public sector whistleblowers, complementing a patchwork of similar legislation at state-level, this reform has been largely ineffectual. The absence of a comprehensive whistleblower scheme in the private sector only exacerbates a prevailing atmosphere of hostility towards those who report governmental or corporate wrongdoing.
Unlike some jurisdictions where whistleblowers are adequately protected from retaliation, able to seek financial rewards and even empowered to initiate lawsuits when regulators fail to act, whistleblowers in Australia face severe personal and professional consequences. A Fairfax headline last year said it all: “Americans pay millions to whistleblower at BHP; we hound them out of their jobs”.
Political developments last November provide hope that change could be imminent. The Derryn Hinch and Nick Xenophon cross-bench deal to pass the government’s union regulation legislation came in return for strong protections for union whistleblowers, and the promise that similar laws will be introduced in other sectors. A parliamentary inquiry will report by June, with the objective of implementing “an equal or better whistleblower protection and compensation regime in the corporate and public sectors” by mid-2018. It has even been suggested that an American-style system of bounties or financial rewards for information could be established.
Long-time observers of whistleblower protection laws in this country will not hold their breath. The federal Public Interest Disclosure Act, which although flawed represents a consideration step forward, took two decades, six parliamentary committees and three unsuccessful bills before finally being passed in 2013. Nevertheless, the prospect of improved whistleblower protections for public servants and the introduction of a private sector equivalent is enticing.Read more
The Bradley Allen Love law firm in Civic could almost be mistaken for an art gallery. As a supporter of the arts for over a decade, lawyer and EASS Patron Keith Bradley AM has a collection that overflows from the office to his home, then into his family’s homes.
“I’ve been collecting for about 12 to 15 years, and I own works across the broad spectrum of photography, glass, woodwork, painting, and sculpture. I find it very enjoyable”, he says.
Works by graduates Sally O’Callaghan, Joel Arthur, Yioryios Papayioryiou and Sara Freeman adorn the office and board room walls, and that’s only what’s on view at work.
“Our home in Fadden is over run with art. The walls are full so I’ve had to move out into the gardens. I’ve got ceramic tiles by Oscar Blyth going up the front of my house, overlooking the Brindabella Valley.”
Buying art for living spaces is something Bradley is particularly passionate about.
“I think it’s sad when people spend an awful lot of money on their houses but don’t have the daring or the bravery or the inventiveness to buy something that expresses their personality, or something that’s a bit quirky, or interesting or beautiful”, he says.
“The only trouble is with all this art you feel you never want to move from the house! It’s all too entrenched. But I get a great deal of fun and satisfaction out of it.”
He also likes to meet artists whose works he buys, and have them over to view the work in its new home.
“The University medalist from last year, glass artist Hannah Gason, came over with her husband to install her lovely piece on the wall.”
Asked what will happen when he runs out of space, Bradley paused, then admitted “that’s a problem, yes.”
But he’s tackled that issue so far by assisting his family to also acquire art. “My most recent purchase from this year’s graduating exhibition was three very beautiful photographs by Monica Styles. They’re going to go into my daughter’s new place in Campbell, and I think they’ll look very snappy in a modern apartment.”
“The other item I bought is a bit law related – we’ve got a commercial conveyancing department here in our law firm and there’s a terrific collage by Emma Holland that will suit that space.”
While Bradley loves buying art for the office, he doesn’t do it alone, but with help from business partner Bill McCarthy who is on several of the arts boards in the ACT.
“He’s a wonderful collector with a very good eye and he enlivens the walls of our office with a lot of the art that he buys”, Bradley says. “But I concentrate on art from ANU School of Art, which I love to support.”
The Personal Property Securities Act (PPSA for short) and the Personal Property Securities Register (PPSR) came into effect nearly five years ago, yet some businesses have never heard of these terms. Regardless of the size or type of your business, the PPSA is likely to affect you.
So what is a “security interest”? A security interest acts like a charge or mortgage over personal property that secures a payment. It allows a supplier to retake possession of the goods it supplied if the customer fails to pay their debts. By registering their interest on the PPSR, the supplier is making sure that their rights are enforceable. To help explain how securities interests and the PPSR may affect you, here is a tale based on a true story but for educational purposes only of course.
Seem complicated? It can be; which is why you need to understand your rights to protect your goods.
This case was determined largely in favour of the customer; but it shows the range of outcomes that can occur when you do (and do not) register your security interests. If you supply goods on credit then make sure your contracts specify what the buyer can do with those goods, whether you can register a security interest and if you do have that right, make sure to register it. Otherwise you too might miss out on reclaiming your goods.
 Warehouse Sales Pty Ltd (in Liq) & Lewis and Templeton v LG Electronics Australia Pty Ltd & Ors  VSC 644
A registration on the PPSR means that if your customer doesn’t pay, or goes broke, you are in the best position to get your goods, or their value, back. If you do have any registrations that transferred across to the PPSR when it started in 2012 and you haven’t taken any action, your registration may no longer ensure your interests are protected.
When the PPSR was established, it replaced over 30 registers (which recorded “security interests” in all types of personal properties). Registrations were automatically moved across to the PPSR on 30 January 2012. Many of these registrations migrated with missing or incomplete fields. The PPSA, provided a grace period, allowing the creditors/secured parties time to fix and update these migrated registrations.
However, this period is coming to an end on 31 January 2017 for registrations that were migrated without an end date.
The PPSA is about registration; it is no longer about ownership rights. If you had (and continue to have) a relationship with a customer or supplier where, prior to 2012, you held a charge over goods (cars, stock, crops etc) and have done nothing about it recently, we strongly recommend you search the PPSR now. If your charge migrated across to the PPSR and has not been claimed or amended, your rights may be ineffective and you may lose rights to recover the goods.
If you need assistance searching the PPSR please contact Katie Innes.
As you are aware, under the Agents Act 2003 (ACT) (“the Act”), a Licensed Agent commits an offence if they deal with Trust money otherwise than as directed by the person for whom the money is held. The maximum penalty being $15,000 for individuals and $75,000 for a corporation. Records must be kept stating the material details of every transaction the Agent conducts.
Failure to comply with the record keeping requirements may result in a maximum penalty of $7,500 for individuals and $37,500 for a corporation. In addition to monetary fines, the Agent, who will also be in breach of the rules of conduct, may have their licence cancelled or suspended.
Agents are at risk of breaching their Trust account requirements if they disburse money contrary to the directions of the parties. If the parties cannot agree on the distribution of the funds, to ensure compliance with the Act, an Agent must hold the funds until agreement is made or court proceedings are commenced. If court proceedings are commenced, the money may be paid into the court, to be held until a decision is made. If court proceedings are not commenced by the parties, one option the Agent may consider is to make its own originating application to the court as a third party under rule 35(1)(a) of the Court Procedure Rules 2006 (ACT). The originating application would be a request to pay the disputed Trust monies to the court where they would be held until the dispute is resolved between the Seller and the Buyer.
If you consider that there may be a dispute in relation to the money you hold in Trust, keep the lines of communication open. If the Contract is subsequently terminated and the parties cannot agree on how it is to be disbursed, a letter to both advising that you may seek the assistance of the courts may be enough to push the parties to come to an agreement. Until you receive written confirmation from both parties that convey the same instructions, do not disburse the Trust monies. Seek legal advice if you consider the dispute is likely to require court assistance or if you are not certain what to do.
First published in REIACT newsletter. Full article available for download here.Read more
A quick guide to The Cans, the Can’ts, the Whats, and the Hows of Delegation AND Sub-delegating Council Functions under Legislation and the Common Law
Chapter 12, Part 3 of the Local Government Act 1993 (NSW) (‘LGA’) governs the power of Councils to delegate their functions.
Principally, section 377 of the LGA affords Councils the power to delegate certain functions to general managers or to other persons or bodies (other than directly to other Council staff).
The statutory regime is designed to facilitate delegations of authority, in recognition of the important functions delegates play in maintaining the effective and efficient governance of Councils. However, the scope of the power to delegate is not without restrictions and Councils need to be aware of the legislative and common law principles governing delegations.
Section 377 of the LGA provides that Council functions can be delegated to general managers and to other persons or bodies. However, the Council cannot delegate directly to an employee of the council other than the general manager.
Section 49 of the Interpretation Act 1987 (NSW) provides some further guidance:
A function can only be delegated to an office or position that is in existence at the time that the delegation is made: Australian Chemical Refiners Pty Ltd v Bradwell (1986) 10 ALN at N96.
Section 377 of the LGA requires delegations to the general manager to be made by Council resolution.
Section 49(2)(b) of the Interpretation Act requires delegations be in writing or evidenced in writing.
Delegations can be general or limited: section 49(2)(a) of the Interpretation Act. Where a function may be exercised in relation to a number of different matters or classes of matters, the delegation may be restricted to only certain matters or classes of matters.
The delegation may be made subject to conditions: section 49(3) of the Interpretation Act. Any conditions restricting the exercise of the delegation must be satisfied for the exercise of the delegation to be valid: Aldous v Greater Taree City Council  NSWLEC 17.
A delegation can cover a wide range of functions. Additionally, section 378 of the LGA gives a general manager the power to delegate any of his functions, including functions that have been delegated to him by the Council.
The delegation of a function includes the power to exercise any other function that is incidental to the delegated function: Interpretation Act, section 49(4).
Where the exercise of a statutory function requires the formation of an opinion, belief, or state of mind, when the function is delegated it is the opinion, belief or state of mind of the delegate and not the primary decision maker that controls the exercise of the function: Interpretation Act, section 49(7).
Even where a function has been delegated, the primary decision maker (the Council or general manager) may still exercise the function at any time prior to its exercise by the delegate: Interpretation Act, section 49(9).
Some functions must be exercised by the Council itself and cannot be delegated. The Council’s non-delegable functions are set out in section 377(1)(a)-(u) of the LGA and include (but are not limited to):
A Council is precluded from delegating a function that is specifically required by any legislation to be exercised by resolution of the Council: section 377(1)(u) of the LGA.
A Council and a general manager are precluded from delegating their power of delegation: sections 377(1)(t) and 387(1) of the LGA.
Where the exercise of discretion is involved in the exercise of a Council function, the function cannot be delegated in a way that requires the discretion to be exercised in a specific way. For example, section 80 of the Environmental Planning and Assessment Act 1979 (NSW) confers power on the council to determine whether to grant consent to a development application. The function conferred involves the exercise of discretion as to whether or not to approve the application unconditionally, to approve it subject to conditions, or to refuse it. The Council cannot delegate the power to approve a development application without also delegating the power to approve it subject to conditions or to refuse it: Belmorgan Property Development Pty Ltd v GPT Re Ltd & Anor  NSWCA 171.
A Council is also obliged to review all of its delegations within the first 12 months of each term of office: section 380 of the LGA.
NB: this is a ‘guide’ only. The legal principles discussed about are intended to provide a general overview of the legal principles applicable to the delegation of Council functions. It is not exhaustive and does not constitute legal advice. Should any questions or issues arise regarding delegation please feel free to contact BAL Lawyers on (02) 6274 0999 or seek alternative legal advice.
Hamlet was fortunate not to be an employment lawyer or human resources professional. Following a recent Queensland case, the question of whether or not to investigate employee misconduct is more vexed than ever.
Public and private sector employers now find themselves walking a tightrope where a misstep in either direction can lead to litigation and liability.
In late September, the Queensland Industrial Relations Commission delivered judgment in East Coast Pipeline Pty Ltd v Workers’ Compensation Regulator. The case involved a workplace investigation into complaints of sexual harassment and bullying. The accused employee allegedly told a colleague that “flavoured condoms were on sale, and that maybe that would give her something to do in the lunch break”, suggested that his colleague was a lesbian because she received flowers from a female friend, made lewd comments about her skirt, and demeaned and swore at other colleagues.
Upon hearing these allegations, the employer initiated a formal investigation into the employee’s behaviour. The employer requested the complainants make their complaints formal, conducted interviews, kept meticulous records, required all participants to sign and endorse interview minutes, suspended the accused employee and sent home the complainants.
To most, the approach adopted by the employer in this case is uncontroversial. Bullying and sexual harassment are serious matters. Employers can be vicariously liable for the sexual harassment of an employee, and the potential for substantial awards of compensation has increased dramatically following the landmark 2014 case of Oracle v Richardson. Being complacent to sexual harassment in the workplace is now a potentially expensive exercise, and for some the decisive action of East Coast Pipelines may resemble best practice.
However, in the present case, the employee under investigation subsequently lodged a workers’ compensation application, claiming that the unreasonable actions of his employer were major contributing factors to a psychological injury he suffered. Despite his employer mounting a vigorous defence, the claim was accepted by WorkCover and then upheld by the Industrial Relations Commission. Both found that East Coast Pipelines had contributed to the employee’s mental health injury by proceeding straight to a formal investigation, and that the employer’s approach did not constitute reasonable management action. Read More.Read more
Since formalising our 12-month health and well being plan with Healthier Work ACT, BAL has already seen improved employee engagement and enthusiasm about participating.
The Directors recognise the correlation between health and well being and productivity, and are proud of BAL’s focus on the program.
To take care of our staff and look after their well being, our team along with the staff at Healthier Work ACT developed the BAL Health and Well being 12 month Plan. Each year it is renewed and refreshed with new activities, initiatives and a different charity to support. Our health and well being plan is broken up into four sections, aligned with the seasons, to address four aspects of health and well being; to help reduce stress, minimise absenteeism and promote well being.
More importantly, it is raising awareness of the high rates of stress and depression that historically affect the legal profession and that the additional vitamin D and exercise obtained through our program may go some way to alleviate this for staff. The end goal is to ensure that all employees are in a happy and supportive workplace with healthy work strategies with both a mental and physical benefit.
Healthier Work has developed the Healthier Work Recognition Scheme, to acknowledge and reward Canberra businesses who are committed to the workplace health and well being journey.
Now in our second year of the ACT Government program, we are very excited to have received our silver status this year.
Our Healthier Work ACT case study is available here.Read more
Workplace drug tests are now commonly conducted across a number of industries. Lately, there has been talk of implementing workplace drug testing programs among all employees of the Australian Public Service.
Melbourne radio station, 3AW spoke with legal director, John Wilson on Drug Testing Employees:
If you are having trouble with drug testing in the workplace, call the BAL employment team on 6274 0999 or contact us.Read more
From 12 November 2016 amendments to the Competition & Consumer Act (2010) (Cth) will take effect which mean that small businesses will now be considered ‘consumers’ and have the benefit of the unfair contract terms regime. Small businesses will be able to seek relief from the Courts to strike out any terms in their “standard form contracts” which are “unfair”.
The regime doesn’t apply to all contracts; contracts must be ‘standard form contracts’ entered into on or after 1 July 2010 and constitutions of companies, managed investment schemes and other similar bodies are excluded from the regime. However, the regime may apply to certain commercial leases and licences of land.
If you haven’t already, we recommend that you review your current contracts (including leases) to determine whether this regime applies to you, to identify any potentially “unfair” clauses and enforcement issues.
For more detail about how the amendments will apply, please visit our website here.
If you would like us to review your existing contracts, please contact Katie Innes.Read more
The 2016 Doyles Guide listing of leading Canberra Wills & Estates Litigation Lawyers has just been released and details solicitors and law firms practising within the areas of Wills & Estates Litigation, Disputes and Contested matters in the ACT legal market who have been identified by their peers for their expertise and abilities in these areas.
BAL Lawyers has been listed as a First Tier Firm in the category of Leading Wills & Estates Litigation Law Firms – Canberra, which is the highest category available in this section. Full Listing Here.
An additional Congratulations to Keith, who this year has been listed as a Leading Wills & Estates Litigation Lawyer – Canberra, 2016. Keith’s ability to empathise and identify with clients’ particular needs sets him apart from others in this practice area. Keith has been listed in the Preeminent section, which is the highest category available to practitioners. Full Listing Here.
Our Estates Lawyers take a holistic approach to estate planning, considering your broader personal, family and financial circumstances to ensure your wealth is passed onto the people you wish to benefit in an efficient and tax-effective way. If we can assist you with a making a will, appointing a power of attorney, estate litigation or helping you set up a business succession plan, please contact us.
Bradley Allen Love are a proud partner of Will It Your Way and are committed to providing young and mature Australians to obtain a legally binding Will and Estate Plan.Read more
When it comes to a company, the corporate “constitution” is often assumed to be the most important document when it comes to governing its day-to-day affairs and operations. In reality, there are a range of issues which are not covered by a constitution and implementing a Shareholders Agreement can be key; giving certainty and clarifying shareholder “rights”, expectations and procedures. These become particularly useful in the event of a dispute or relationship breakdown. Shareholders Agreements cannot remove a shareholder’s statutory rights.
Consider the following issues which can be covered in your Shareholders Agreement:
The risk in not having a Shareholders Agreement is that a dispute or stalemate between the decision makers could jeopardise the operation of the business or payment of creditors, leading to a deterioration of the business’ good will and value. Absent a predetermined resolution process, the only way to resolve a dispute may be litigation, which in turn can lead to the winding up the company by the Courts.
Ideally, your Shareholders Agreement can be drafted and filed away, never needed because the business and the parties are working well together. If, however, you ever get caught up in a dispute, you’ll be glad you’ve got a safety mechanism in place.
First Published in B2B Magazine, available here.Read more
On October 18, 24 teams from Canberra businesses came together for an evening of Sweatworking to raise money – each team registering with a minimum $250 donation to Global School Partners.
The fifth annual Sweatworking® event saw the teams rotate through 10 stations completing a variety of exercises including the gruelling burpee and jump!
After the 10 rounds were completed, there was a quick break for a sausage sizzle and some networking, before the finals began.
The teams that made it to the finals we Much more than Money, EY, Netier and BAL Lawyers.
The finals were close, but Much more than Money couldn’t be rivalled. A huge congratulations to the Winning Team from Much more than Money – “Much More than athletes” – who proudly took home the champions cup.
Sweatworking® is an annual networking event organised by Bradley Allen Love Lawyers which pits teams from a variety of Canberra organisations against each other in a physical challenge.
Bradley Allen Love created the annual Sweatworking® challenge to facilitate being able to network and staying active at the same time.
It’s an event that focuses on health and fitness and most importantly friendly competition. It’s the Bradley Allen Love way to network – fresh, exciting and innovative.” Sweatworking® is not only a fantastic fundraiser assisting the wider community, but participants also benefit from the experience of exercising in a challenging outdoor environment. “The correlation between physical and mental health cannot be underestimated.
We are excited about our partnership with Global School Partners, raising funds to assist them in the vital role they play in our community
Thank you to everyone for participating in our Sweatworking event last night. We cannot thank everyone enough for the donations that totalled $6,500! We were very proud to hand over the cheque to Simon Carroll, CEO of Global School Partners.
The list of organisations that participated in Sweatworking®2016 and donated are;
|Addvantage Accountants||Global School Partners|
|SPA Accounting||MUCH Pty Ltd|
|DUO||Ernst & Young|
|Southlands Capital Chemist||Trilogy|
Looking Forwards to seeing you all for Sweatworking 2017!
Sweatworking 2016 brings together Corporates from across the region to push their athletic prowess to the limit tomorrow with Global School Partners set to reap the benefits of an evening spent Sweatworking®.
Sweatworking® is an annual networking event organised by Bradley Allen Love Lawyers (BAL) which pits teams from a variety of Canberra organisations against each other in a physical challenge, each team registering with a minimum $250 donation to Global School Partners.
Now in its fifth year, Sweatworking 2016 will see 25 teams of four; rotate through 10 stations completing a variety of exercises in the bid to take out the Champions Cup, awarded to the team with the most points at the end of the event.
BAL Lawyers created the annual Sweatworking® challenge to facilitate being able to network and staying active at the same time.
Sweatworking 2016 compliments the work ethic and philosophies of staff at BAL Lawyers while raising funds for a different charity each year.
It’s an event that focuses on health and fitness and most importantly friendly competition. It’s the BAL Lawyers way to network – fresh, exciting and innovative.
We are excited about our partnership with Global School Partners, raising funds to assist them in the vital role they play in our community.
Sweatworking 2016 will commence at 6:00pm (sharp), Tuesday 18 October at the AIS Outdoor Synthetic Oval.
The list of organisations participating in Sweatworking®2016 and donating are;
|Addvantage Accountants||Global School Partners|
|BAL Lawyers||MUCH Pty Ltd|
|DUO||Ernst & Young|
|Southlands Capital Chemist||Netier|
Media and spectators are welcome to attend this event to encourage their friends or colleagues. Participants will enjoy a BBQ and refreshments at the conclusion of the event.Read more
It is not uncommon, in claims seeking monies owed under services contracts, for plaintiffs to plead an alternative cause of action in quantum meruit (Latin for ‘what one has earned’). In doing so, the litigant is essentially saying: ‘even if there is some defect in the contract on which I rely, I have nevertheless performed services at your request, and it is not fair that you benefit from my services without paying me for them.’ In principle, this is not an altogether unreasonable fall-back position. But what if it is your only position? What if youhave not taken steps to formalise your expectations for payment through a written contract? How are you going to prove what the value of your services amounts to? The recent ACT Supreme Court case of Beagle v ACT & Southern NSW Rugby Union Limited  ACTSC 71, in which the ACT Brumbies successfully defended a quantum meruit claim, considered these issues.
Mr Beagle – a retired gaming industry consultant – approached the ACT Brumbies in December 2014, at a time when the organisation was publically known to be without a major sponsor heading into the 2015 Super Rugby competition. In a meeting with the Brumbies’ then CEO on 4 December 2014, Mr Beagle asserted that he knew of a possible sponsor but, for confidentiality reasons, he could not disclose who. Whilst the Brumbies were interested in being introduced to the unidentified sponsor – at least, generally, given the uncertainty as who they were talking about, or to – no terms were agreed as to what, precisely, Mr Beagle would do, or how he would be paid (if at all). Rather, only vague comments were said, along the lines that Mr Beagle would expect a “finder’s fee” or that the Brumbies would “look after him” if Mr Beagle “pulled it off”.
It was not, however, discussed or agreed what was meant by a “finder’s fee”, or how Mr Beagle expected to be “looked after”. More importantly, the meeting ended without any clear certainty as to what Mr Beagle was tasked to “pull off”.
On 15 December 2014, Mr Beagle met with a Hong Kong group (‘Aquis’), who had arrived in Canberra as part of their purchase of the Canberra Casino. Prior to the meeting, Mr Beagle provided Aquis’ executive director with a Brumbies sponsorship proposal document. However, Aquis agreed to meet with Mr Beagle before receiving the sponsorship document, with a view to gaining insight into the workings of ACT Government. When it became apparent to Aquis that Mr Beagle was of no assistance to that end, the meeting was concluded. Aquis’s executive director gave evidence that she could not recall the extent – if any – that the Brumbies may have been discussed at that meeting.
In early 2015, with Aquis having completed its purchase of the Canberra Casino, it sought advice from its public relations advisors as to strategies to engage with the ACT community. The advice was to sponsor the Brumbies. When a sponsorship deal was subsequently completed, Mr Beagle surfaced to claim his “finder’s fee” for his part in the transaction. The Brumbies, unaware of what approaches Mr Beagle made to Aquis (keeping in mind that Mr Beagle had declined to identify his contact for “confidentiality reasons”), and having identified and approached Aquis independently through their publicly reported purchase of the Canberra Casino, refused to pay any such fee.
In the absence of a contract setting out (a) what he was tasked with doing, or (b) how he would be remunerated, Mr Beagle commenced proceedings against the Brumbies exclusively through a claim in quantum meruit. In doing so, Mr Beagle likened his services to that of a sports agent, and sought a reasonable compensation, comparable to a commission, in the sum of $587,000.
Applying the Quantum Meruit principles
Even in the absence of a contract, the law may impose an obligation to make restitution, or pay reasonable compensation, on a quantum meruit basis where a plaintiff can prove that:
In the Beagle case, it was accepted by the Brumbies that a ‘request’ was made for Mr Beagle to deliver their sponsorship proposal to an unidentified potential sponsor. Whilst not known to the Brumbies at the time, through the legal proceedings, it was evident that Mr Beagle did so – such that the elements (1) and (2) above were satisfied.
However, where Mr Beagle’s claim came unstuck was his failure to prove the Brumbies were aware of his expectation for payment. To the extent that the Brumbies had acknowledged an entitlement, it was conditional upon Mr Beagle “pulling it off”, which imported a requirement that he have some causal influence over Aquis’ eventual decision to enter the sponsorship was required – Mr Beagle was unable to make this out on the evidence.
The court also did not accept any ‘benefit’ was conferred upon the Brumbies which would render their refusal to compensate Mr Beagle for the services carried out by him (largely outside of their knowledge or control) as being unjust. Accordingly, neither element (4) nor (5) above was satisfied.
The simplest way to minimise disputes is to formalise your agreements in writing. Where practicable and possible, legal advice should be obtained. Had Mr Beagle made it clear that he expected to be paid such a significant “finder’s fee”, notwithstanding the steps taken by him would be minimal, the Brumbies no doubt would have instructed him not to carry out any services and no dispute would have arisen.
Equally, if you do have a contract on foot, do not assume that pleading an alternative quantum meruit claim will solve any technical deficiencies in your contractual claim. As the High Court held in a leading quantum meruit authority, Pavey & Matthews Pty Ltd v Paul, ‘An inability to sue on a contract provides no ground for imposing a quasi-contractual obligation inconsistent with the contractual obligation to pay remuneration.’
For example, if your contract fails to clearly set out the remuneration payable, you may encounter the same difficulties as Mr Beagle in establishing your opponent’s knowledge of your expectation to payment. Alternatively, the compensation payable under quantum meruit may see your remuneration assessed in line with industry standards or conditions which you had not intended your contract to be limited by.
After all, and returning finally to the Beagle decision, in many respects it is easy to argue that there was an enforceable contract in place. That contract, however, would have required Mr Beagle to “pull it off” (that is, arrange the Aquis sponsorship), such that his entitlements under contract would have been ‘nil’. In sum, then, the Beagle case demonstrates that relying on quantum meruit, whether exclusively or as a fall-back position, is a risky bet. For Mr Beagle, his gamble failed to pay off in the ACT Supreme Court.
Disclaimer: Bradley Allen Love acted for the Brumbies in their successful defence of Mr Beagle’s claim. Please note this case is currently subject to appeal. Further updates will be provided as they become available.Read more
Costs, it might be said, are an unsexy topic. Amidst the cut and thrust of high stakes litigation, questions of costs can be easily overlooked. Yet that does not diminish their importance. Many a courtroom victory has been soured by an unfavourable costs order.
In the employment context, costs take on additional importance. The financial stakes in employment disputes are often lower than in commercial litigation, such that costs can quickly surpass any damages awarded. Almost all employment grievances involve at least one individual party, who ordinarily will be far less able to absorb an adverse costs order than a corporate litigator. The diverse variety of costs regimes governing workplace-related litigation, which in turn often have complex and uncertain exceptions, only amplifies the necessity for employment lawyers to be attuned to the law in this area.
The following article intends to provide practitioners with an accessible guide to costs in employment disputes. It will begin by considering the costs protections offered by the Fair Work Act 2009 (Cth) and Public Interest Disclosure Act 2013 (Cth), before identifying other prominent employment related claims which lack beneficial costs regimes. It then concludes by highlighting an important yet often overlooked issue — the application of inconsistent costs regimes to litigation where multiple causes of actions are pleaded.
Fair Work Act
The general position in disputes under the Fair Work Act, which account for the bulk of employment litigation, is that parties bear their own costs. Thus, in unfair dismissal and general protection claims, among others, the costs result is the same — win, lose or draw. This default position gives effect to a desirable policy objective: encouraging the resolution of employment disputes in a cheap and efficient manner. When neither party can be awarded costs, there is — in most circumstances — a common interest in avoiding protracted litigation. Although there are nuances to the costs treatment of different sections of the Fair Work Act, and slight deviations depending on the chosen forum (whether the Fair Work Commission or a court exercising federal jurisdiction), generally the exceptions to this no costs principle are limited to three. Read More.
First published in Ethos: Journal of the ACT Law Society.Read more
These days, information is can be the most valuable asset a business can own – so how do you protect it when entering into a new business partnership? Confidentiality or Non-Disclosure Agreements (NDA) are used in a wide variety of business relationships, where protection of one or both sides’ confidential information is essential, whether it’s customer and contact lists, design concepts or logo material, employee data or the protection of non-patented inventions being presented to a manufacturer or new investor.
Here are four quick tips to keep in mind when crafting an NDA for your business.
1. Define the confidential information appropriately
Your first question should be what information needs to be protected? The key to a successful and enforceable NDA is an accurate and comprehensive definition of what information is confidential and covered by the agreement. If you are intending to “open your books” then it should be an exhaustive definition that covers all business information disclosed in the course of negotiations, the relationship or for the purpose of the collaboration. Without a definition, you may have difficulty enforcing the parameters of the NDA in a later dispute.
2. Permitted purpose
You should specify the purpose for which the confidential information is being disclosed and can be used. This will limit the recipient’s use of the confidential information to that prescribed purpose. Any other use for any ulterior purpose will be a breach of the agreement, with liability consequences.
3. Disclosure to employees
If you are disclosing information to a company or entity, then the information will often need to be shared with the directors and/or employees of that entity. An NDA can ensure that the original recipient is held responsible for the actions of their employees and others in possession of the confidential information and place limits on who can receive the information, minimising the potential distribution of your confidential information.
4. End of the agreement
Consider the “end-game” – NDAs should make clear what happens to the information at the end of the business relationship, whether this occurs upon the expiry of a fixed term on a certain date, or when certain conditions are met. Details to cover here include the return or destruction of any confidential information still in the possession of the recipient and a continuing obligation to not disclose.
The above tips are designed to minimise the risk of your confidential information being released to the general public and to give certainty to the contracting parties. If you are considering a business collaboration or commercial joint venture, we recommend that you seek professional advice on whether an NDA is an appropriate mechanism to protect your information.Read more
When is it OK to discipline an employee for swearing in the workplace?
Everyone has done it. Whether in a fit of rage, while watching a close sports game or experiencing pain, the occasional expletive is part of a standard vocabulary. But what happens when such language is uttered in the workplace? At what point does friendly banter or light-hearted self-criticism become a breach of the public service code of conduct?
The answer is no longer as simple as it might once have been; coarse language has become increasingly commonplace in society. As a fair work commission explained last year, “there is no doubt that workplaces are more robust in 2015, as they relate to the use of swearing, than they were in the 1940s”. Drawing the line between acceptable and unacceptable conduct is increasingly difficult.
Two recent private sector cases highlight this uncertainty. In Sayers v CUB Pty Ltd, a Carlton & United Breweries employee told a colleague “you are nothing but a dirty gringo c—” and “any place, any time, you name it, you are going down”. After he was sacked on the ground of serious misconduct, Mark Sayers applied for unfair-dismissal relief.
Despite a rather creative application, which asserted that “gringo” was not intended as a racist slur because the target of the comment was South American, and the term is traditionally used by South Americans to disparage North Americans, Sayers’ claim failed. Fair Work Commission deputy president Richard Clancy observed that “there is no place for behaviour in the workplace that combines threats of violence, racial slurs of such an offensive and degrading nature, and such inappropriate abuse and offensive language”.
In contrast, in Goodall v Mt Arthur Coal Pty Ltd, a mining truck operator won reinstatement after his dismissal from BHP Billiton’s Hunter Valley coal mine. Jodie Goodall had engaged in “banter and chat” over a radio system “as a means of dealing with fatigue” towards the end of a 12½-hour night shift. This “banter” included comments that a colleague was…Read more.
First published in the Canberra Times, July 2016.Read more
The statistics regarding drugs in Australia are overwhelming. Nearly one in two Australians have used an illicit substance in their lifetime; 15% have used an illicit substance in the last 12 months; and 93,148 were arrested for “dealing” an illicit substance in 2010/11. But what should you do if a property you manage is tenanted by a drug dealer?
This situation came up in the recent NSW Case of Davis v NSW Land and Housing Corporation  NSWSC 1025. The landlord tried to kick out a tenant because the tenant’s husband had been using her unit and common property to sell heroin.
The Court ruled that the tenant, by allowing her husband to sell heroin from the premises, had permitted the use of the premises for the purposes of the sale of a prohibited substance (in contravention of section 91 of the Residential Tenancies Act 2010). This meant the landlord’s successful application to the Tribunal to terminate the tenancy agreement was valid.
In the ACT the Residential Tenancies Act 1997, unlike its NSW counterpart, does not have specific provision allowing ACAT to terminate a residential tenancy if the premises are used in the cultivation or supply of a prohibited drug.
However, the Residential Tenancies Act 1997 does insert into all residential tenancy agreements a clause prohibiting the tenant from using the premises, or permitting them to be used for an illegal purpose. If the tenant does use or permit the premises to be used for an illegal purpose, the landlord can seek to have the tenancy terminated by taking the following steps:
If ACAT is satisfied that the breach justifies a termination, it will order the termination of the tenancy.
Although issues such as a tenant selling illicit substances or drugs do not arise every day, residential property managers should still be aware of the terms of the Residential Tenancies Act 1997 allowing termination of a tenancy agreement.
The Property team of BAL Lawyers, a Corporate Partner of REIACT, can assist agencies with tricky situations. If you find your agency or your landlord clients in a tricky situation please give us a call.
 Statistics from http://www.druginfo.adf.org.au/topics/statistics-trends#illicit and http://aic.gov.au/media_library/publications/facts/2013/facts_and_figures_2013.pdf.
 Residential Tenancies Act 2010 (NSW) s 91(1).
 Residential Tenancies Act 1997 (ACT) s 70(a).
This article was first published in REIACT newsletter, September 2016.Read more
The recent case of Chamberlain Group Pty Ltd v Kids for Life Academy Pty Ltd  NSWCA 241 (Chamberlain Group) demonstrates that landlords should tread carefully when requests for consent to assignment of leases are made by tenants. Lease documents will generally set out the requirements necessary for consent to assignment of a lease, however the conduct of the parties may also be taken into account when determining whether or not consent to assignment of a lease has been obtained.
In Chamberlain Group, the Court ruled that the landlord’s conduct supported a conclusion that “consent” had been provided to the request for assignment of the lease regardless of the fact that no formal documentation had been executed by the parties. The following factors were relevant to this determination:
The Court held that the conduct of the landlord in this case amounted to the landlord providing the necessary “consent” set out in the lease and this was despite the fact that no assignment documentation had been formalised and no transfer of lease had ever been registered.
The terms of the lease in this case stated simply that landlord “consent” was the necessary pre-condition to assignment, not that an agreement regarding landlord “consent” be obtained first.
The Court confirmed that whilst there was no registered lease to the assignee on the title to the land, there was nonetheless an enforceable unregistered leasehold interest in the Premises and the caveats lodged on the title to the land by the assignee to protect its interests were upheld.
It is important to remember that not all leases will be drafted in the same manner and that conduct can amount to consent in certain circumstances. If you require advice and assistance in a matter involving an assignment of lease, please contact a member of our experienced Leasing Team.
Changes to mandatory energy efficiency disclosure for office premises:
From 1 July 2017 premises capable of being used as an office which are offered for lease will require a Building Energy Efficiency Certificate (BEEC) in accordance with the Building Energy Efficiency Disclosure Act 2010 if the area of the premises is greater than 1000m2 (this reduces the threshold from 2000m2). After 1 July 2017 owners of premises with a lettable area over 1000m2 but under 2000m2 must ensure compliance with the obligation to have a BEEC before offering to lease the premises. Significant financial penalties may be imposed for noncompliance.
 Chamberlain Group  NSWCA 241 paragraph .
 Chamberlain Group  NSWCA 241 paragraph .
 Chamberlain Group  NSWCA 241 paragraph .
 Chamberlain Group  NSWCA 241 paragraph .
 Chamberlain Group  NSWCA 241 paragraph .
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 Chamberlain Group  NSWCA 241 paragraph .Read more
The recent case of Spuds Surf Chatswood Pty Ltd v PT Ltd (No 4)  NSWCATAP 11 (the Spuds Surf Case) demonstrates that landlords should be aware of their conduct and the impact of new tenancies on existing tenancies when making a new deal.
Lease documents will not always refer to sightlines or guaranteed views, contain height restrictions or refer to a proposed new tenancy that was not considered at the time of entering into the Lease.
The relevant facts of the Spuds Surf Case are:
The relevant findings from the Spuds Surf Case are:
In ordering the rent relief, the NSW Civil and Administrative Tribunal noted the “ongoing nature” of the Landlord’s unconscionable conduct “may well” have contributed to the tenant’s reduced turnover and subsequent financial difficulties.
The emphasis of the decision in the Spuds Surf Case focused on the actions of the Landlord and whether the Landlord acted unconscionably.
When considering new tenancies which may affect current tenants’ sightlines or views, irrespective of what is contained in the lease documents, it is recommended that landlord’s maintain an open dialogue with tenants. There are also notification requirements within the Leases (Commercial and Retail) Act 2001 (ACT) which may apply.
It is important to remember that not all leases will be drafted in the same manner and that conduct can be unconscionable in certain circumstances. If you require advice and assistance in a matter involving a new kiosk tenant, please contact a member of our experienced Leasing Team.
Changes to mandatory energy efficiency disclosure for office premises:
From 1 July 2017 premises capable of being used as an office which are offered for lease will require a Building Energy Efficiency Certificate (BEEC) in accordance with the Building Energy Efficiency Disclosure Act 2010 if the area of the premises is greater than 1000m2 (this reduces the threshold from 2000m2). After 1 July 2017 owners of premises with a lettable area over 1000m2 but under 2000m2 must ensure compliance with the obligation to have a BEEC before offering to lease the premises. Significant financial penalties may be imposed for noncompliance.
 Spuds Surf Case, paragraph .Read more
The recent Land and Environment Court of New South Wales decision in Tanious v Georges River Council  NSWLEC 1330 is a timely reminder of the utility of a local orders policy for NSW councils in relation to controlling the number of animals at a residential property.
Mr Tanious kept 3 roosters, 30 chickens, 1 turkey rooster, 1 female turkey and between 130 and 150 Japanese quail at his residential premises. Georges River Council (formerly Hurstville City Council) considered that the keeping of this number of birds was excessive for the site and had the potential to cause unhealthy conditions.
On 18 January 2016 the Council issued an order to Mr Tanious under section 124 of the Local Government Act 1993 which required him to remove all poultry from the property with the exception of 10 birds (including all roosters but excluding offspring to three months of age), and required the remaining birds to be kept in a paved poultry house 15.2 metres from a dwelling. Mr Tanious appealed the Council’s order and sought to set it aside or alternatively, to increase the number of birds that may be kept at his premises.
The Council relied upon its ‘Local Orders Policy – Keeping Animals’ (Policy) for the purposes of assessing the number of, and manner in which, birds could be kept at the premises. In the case of domestic poultry and guinea fowl, the Policy permitted a maximum number of 10 birds with poultry houses to be 4.5 metres from buildings. In the case of other poultry (including ducks, geese, turkeys, peafowl and other pheasants), the maximum number of birds permitted was 5 and the poultry housing was required to be at least 30 metres from a dwelling. The Policy also noted that a greater separation distance may be required in particular cases; hard paving must be provided under roosts if within 15.2 metres of a dwelling and roosters were prohibited where crowing will cause offensive noise.
The Court was guided by the Policy in coming to its decision. It noted that the Policy sought to regulate an appropriate number of animals that can be kept in a residential property within the community, had been the subject of public consultation and had recently been reviewed.
Unsurprisingly, the Court considered that the number of birds kept by Mr Tanious at his premises needed to be reduced. However, it found that the Policy permitted up to 15 poultry birds (including the Japanese quail, but excluding offspring to 3 months of age) to be kept and that it only required a separation distance of 4.5 metres between a paved poultry house and the dwelling house. It therefore applied the Policy and varied the terms of Council’s order so it was consistent with these requirements.
The Court supported the Council’s position in relation to the keeping of the roosters. It found that, having regard to the proximity of nearby residential properties and the manner in which the birds were housed, the keeping of a rooster was likely to result in ‘offensive noise’ (as defined in the Protection of Environment Operations Act 1997) and required them all to be removed.
What can your Council learn from this case?
The Court’s reliance upon the publicly exhibited policy as a guiding factor to determine the number of birds and the manner in which they are kept demonstrates the value of a clearly stated local orders policy for the keeping of animals.
The decision also illustrates that the Court will hold a Council accountable to the terms of its orders policy unless there are clear reasons not to do so.Read more
When drafting your Will it is important to be aware that many words do not carry what would seem to be their everyday meaning. If a document could have a side-view mirror it would read: “Warning: words in Will carry greater legal baggage than appears.”
Take the word “survive.” If you leave something in your Will to grandchildren who “survive” you, what do you mean? Do you intend to benefit only those grandchildren who were born during your lifetime? Or do you intend to benefit all the children your children may have, even if they were born after your death?
There have been cases that have turned on just this question. Lawyers and judges alike have debated the sense in which “survive” should be construed, calling on dictionaries, Shakespeare, and “intuition” in the process. Overwhelmingly, the interpretation has been this: to “survive” is to “outlive” – someone survives you if they live both during and after your lifetime.
It is an interpretation that is not without a catch, or two (or three). One such catch is known as the 30-day rule.[i] It applies in all Australian jurisdictions, and it means that even if a beneficiary survives you, they are presumed to have died before you unless they lived for a full 30 days after your death.
Another catch in the word “survive” could be that you unwittingly enable impatient beneficiaries to access their inheritance earlier than you wanted them to. Imagine you leave your estate to your two children, Bill and Ben, provided they attain the age of 30. If either die before you, you leave everything to any children that they have “who survive [you].” This means that if you die and Bill and Ben have no children, there are never going to be any grandchildren who could be considered to “survive” you. There is no-one else your estate could possibly go to except for Bill and Ben. So, Bill and Ben say, “why can’t we take the money now? Why should we have to wait til we’re 30?” From a legal perspective, it is a good question.
Finally, does a child “survive” you if they were not yet born but were conceived and anticipated while you were alive?[ii] What about frozen embryos that are created during your lifetime but only implanted and carried to term after your death?[iii] The normal meaning of the word “survive” does not adequately cover these cases and therefore may not align with your intentions.
To survive is not merely to live after, and it is not merely to outlive: terms and conditions attach.
Ultimately, the best way to guard against your testamentary intentions being misconstrued is to seek the advice of specialised estate planners who are aware of these language minefields and can navigate the drafting of your Will through them.
[i] See, for example, Wills Act 1968 (ACT), section 31C.
[ii] See, for example, Knight v Knight (1912) 14 CLR 86.
[iii] See, for example, Krstic v State Trustees Ltd  VSC 344.Read more
The recent NSW Court of Appeal decision in De Angelis v Wingecarribee Shire Council  NSWCA189 has significant implications for development applications which are made but not determined before an amendment to a Local Environmental Plan (LEP) comes into force.
In De Angelis v Wingecarribee Shire Council  NSWLEC 1, a case decided by the Land and Environment Court in February this year, the Court found that the standard instrument savings provision, clause 1.8A, applied to an application which was made but not determined before an amendment to the Wingecarribee LEP commenced. In this case Wingecarribee Shire Council delayed determining a development application it had received for mixed use development and amended its LEP by rezoning the land the subject of the application so that the proposed development was prohibited rather than permissible with consent. When the deemed refusal of the application came before the Court the Council asserted that the Court had no power to grant consent to the application on the basis that the development was prohibited by the amended LEP. The Land and Environment Court did not agree and applied clause 1.8A to ‘save’ the operation of the unamended LEP. The Court’s interpretation would then have enabled it to go on to determine the development application on its merits and did not require the application to be refused.
However, the application of clause 1.8A in this context was comprehensively rejected by the Court of Appeal. The Court of Appeal found that clause 1.8A only applied to development applications which were made before the commencement of an original LEP and did not ‘save’ development applications which were made but not determined before an amendment to a LEP came into force. The Court noted that savings provisions are generally not ambulatory in their operation, but instead deal with a precise point in time, being when the new legal instrument commences. In the words of the Court, to give clause 1.8A any additional operation is ‘inconsistent with its purpose, as well as its language’. It followed that, in this case, clause 1.8A did not apply and the proposed development was prohibited by the time the matter came to be determined by the Court.
The Court of Appeal’s decision has two key implications:
A married couple have been ordered to pay more than $1.1 million in damages to a friend who fell from a ladder while working with friends on their roof.
The accident occurred after the couple engaged their friend as a paid contractor to replace the roof of their home. The husband provided and erected the ladder in the “A position” in front of the carport roof. The top of the ladder was about 40cms lower than the roofline. Their friend fell from the ladder while descending it frontwards, hitting his head and suffering other injuries.
In a decision of Hendrex v Keating  Tas SC 20 (13 April 2016), the Tasmanian Supreme Court found that the husband failed to eliminate the foreseeable risk of a person falling from the ladder in failing to erect the ladder in an extended position instead of the A position or secure it with a rope to the carport roof. The couple breached their duty of care to their injured friend as they had a duty to protect him from harm while travelling up and down from the carport roof; that his capacity to take care for his own safety did not alter this duty; and that the accident was reasonably foreseeable.
The case is a timely reminder of the problems that a householder can encounter when a group of friends are engaged to work on their home. Here, the husband arranged to pay the friend for his work; the other friends volunteered to work without payment. The husband provided a ladder and was present at all times controlling the work project.
There was a finding of contributory negligence against the friend as he increased the level of danger to himself by using the ladder when it was not in the extended position, using the ladder when it was not secured, and coming down the ladder frontwards with nothing to hold onto. The Court considered that the friend’s negligence was greater than the husband’s and the damages ($2.6 million) were reduced by 60% because of contributory negligence. The Court regarded the friend as an experienced tradesman working irregularly, mainly doing tiling and roofing work and was engaged, at the time of the accident, as an independent contractor.
It is important that a householder is aware of the liability risks when friends are engaged to perform work on their home. The householder should always consider the risks associated with the work when making decisions about who will undertake the work. A risk assessment should be conducted in relation to all facets of a work project so a decision can be made whether to engage experienced or licensed professionals to undertake specific work. Only involve friends if the overall health and safety risk is very low and, if in doubt, always seek assistance from a licensed professional. When you engage a tradesman, your home should become their workplace. These tradesmen should provide their equipment to perform the work and be responsible for their own occupational health and safety issues.
If you engage a domestic worker such as gardener or cleaner, you could be liable to pay compensation if they are injured. While your home and contents insurance may have public liability cover, this does not necessarily mean that this will include cover should a worker be injured on your property.
This is because public liability insurance does not normally apply if the person injured is considered an “employee” under the terms of the policy or generally at law. It does not matter if you believed you had engaged your gardener or cleaner as an independent contractor and not as an employee – if the terms and conditions of their engagement indicate that they are an “employee” at law, then they will be entitled to bring a workers’ compensation claim and possibly sue for common law damages for their injury.
Although there is no national code for workers compensation, each state and territory has a Fund that will meet such claims under workers’ compensation legislation. The Fund will have the right to seek recovery of those claim costs from you, having a devastating impact on you and your family.
There are three key factors to be considered, although individually each one would not be definitive:
As a contractor, the onus is on this individual to have insurance, although if you were found to be negligent, then you might want to have extra cover to protect yourself against this risk.
If you are planning on having a worker on your property to undertake some work, then in the first instance you should ask them whether they have their own insurance – ask to see proof. The insurance should cover:
It can be expensive for a worker to obtain this contractor liability insurance – this will be reflected in the invoice for their work. If an uninsured worker hurts themself on your property, you’ll find a lawyer’s hand in your pocket pretty quickly.
While it may not be necessary for you to take out insurance to cover domestic help in your home, it is certainly worth your while to check the policy. If you are uncertain, you should approach your insurer to see if you are covered through your home and contents insurance policy.
Remember that insurance is an essential protection.Read more
This month, the Estates team donated their time and expertise to the Salvation Army Wills Day.
The Wills Day has been initiated by The Salvation Army to help relieve some of the confusion and anxiety associated with making Wills, while raising funds for their extensive work with the needy.
For recognition of their pro-bono work, the team were awarded a certificate of thanks.
To see more of the great work the Salvation Army does, or to see dates and locations for their upcoming will days, see their website.Read more
Directors are not the only decision makers regarding the operation and direction of a company’s business; shareholders also have a lot of power. By being entitled to vote on key resolution affecting the company’s future, its directors and strategic goals, shareholders can be crucial to a company’s success and expansion. Shareholders exercise their powers through general meetings – but who has the right to call these meetings, and what resolutions can be considered by the shareholders?
Under the Corporations Act 2001 (Cth), such meetings can be called by either a company’s director(s) or its member(s), where the shareholders hold at least 5% of the eligible votes and make the appropriate meeting request to the directors.
Before a meeting can be held, a notice must be issued to shareholders, detailing the proposed resolutions. Share holders can also propose ordinary resolutions from the floor, if they meet the minimum threshold requirements (5% or 100 members). Ordinary resolutions require 50% majority support to be adopted. Generally, these resolutions relate to the day to-day business of the company, such as the appointment of directors or auditors. Special resolutions require a higher threshold of 75% support which is reflective of their importance.
Generally share holders cannot overrule a Board decision, but in extreme circumstances they can apply to a Court to prevent the Board from carrying out a decision if deemed ‘oppressive conduct’. This occurs where the conduct of the company’s affairs is either:
1. contrary to the interests of the members as a whole; or
2. oppressive to, unfairly prejudicial to, or unfairly discriminatory against, a member.
First published in B2B Magazine.Read more
In 2012, barrister Mark Irving commenced the section on good faith in employment contracts in his text with that pithy summary of the uncertain legal position. He continued: “The following description of the law will be completely outdated once the High Court has resolved these issues.”
When Mr Irving appeared before Australia’s apex judiciary two years later, for the respondent in Commonwealth Bank of Australia v Barker, he must have wondered whether those words would prove prophetic.
Unfortunately for Australian employment lawyers, the occasion has not yet arisen for Mr Irving to wholly revise his consideration of the implied term of good faith. While the High Court in Barker definitively rejected the implication of a term of mutual trust and confidence in employment contracts, they refused to consider its ‘sibling’, good faith.
The plurality of French CJ, Bell and Keane JJ observed: “The above conclusion [regarding mutual trust and confidence] should not be taken as reflecting upon the question whether there is a general obligation to act in good faith in the performance of contracts. Nor does it reflect upon the related question whether contractual powers and discretions may be limited by good faith and rationality requirements analogous to those applicable in the sphere of public law. Those questions were not before the Court in this appeal.”
Kiefel J provided a slightly lengthier consideration, pondering that ‘in some legal systems good faith is regarded as a vitally important ingredient for a modern general law of contract … This raises the question how other legal systems cope without it.’
Yet she too refused to delve further. Despite admitting that the question had not been resolved in Australia, as it was not raised in argument she concluded: “It is therefore neither necessary nor appropriate to discuss good faith further, particularly having regard to the wider importance of the topic.”. Read more.
First published in Ethos.Read more
Councils and developers are continuing to grapple with the process of amending development standards under clause 4.6 of the standard instrument local environmental plans. However, the trend in recent cases, including the recent decision in Zhang v Council of the City of Ryde , has been towards taking a more liberal approach to allowing variations to development standards.
Clause 4.6 allows a consent authority to grant consent for development, even though the development would contravene a development standard imposed by an environmental planning instrument, where the following requirements are met;
1. the consent authority has considered a written request from the applicant that seeks to justify the contravention of the development standard by demonstrating:
a. that compliance with the development standard is unreasonable or unnecessary in the circumstances of the case, and
b. that there are sufficient environmental planning grounds to justify contravening the development standard.
2. the consent authority is satisfied that:
a. the applicant’s written request has adequately addressed the matters required to be demonstrated by subclause (3), and
b. the proposed development will be in the public interest because it is consistent with the objectives of the particular standard and the objectives for development within the zone in which the development is proposed to be carried out, and
3. the concurrence of the Secretary has been obtained.
Four2five Pty Ltd v Ashfield Council  NSWLEC 9 was one of the first appeal cases to consider clause 4.6. In this case, the Court refused to vary the relevant development standards for two primary reasons:
1. the written request failed to demonstrate that the grounds for departing from the standard were particular to the circumstances of the proposed development on the subject site; and
2. the applicant had not demonstrated that compliance with the development standard was unreasonable or unnecessary, in addition to demonstrating that the proposal was consistent with the objectives of the standard.
The Four2five case, other recent cases demonstrate a trend towards allowing variations where these two elements are not necessarily met. This is facilitated by the broad discretion given to the consent authority under clause 4.6.
Zhang v Council of the City of Ryde is the latest in a series of cases to apply clause 4.6. The case involved an application for the construction of in-fill affordable housing (multi-dwelling housing) in the low density residential zone (R2). The proposed development exceeded the 5m height requirement which applied and also exceeded the density controls for the zone.
The applicant had prepared a written request to vary the relevant height and density controls. He argued that strict compliance with the standards was unnecessary, in part, because the proposed development would not have any unreasonable adverse impacts and would facilitate the provision of an additional dwelling house to be dedicated as affordable rental housing for a period of 10 years. Similar reasons were put forward to justify departure from controls on environmental planning grounds. The Council did not support the written request.
Commissioner Brown reiterated that clause 4.6 imposes three preconditions which must be satisfied before the application could be approved:
1. The consent authority must be satisfied that the proposed development will be consistent with the objectives of the zone;
2. The consent authority must be satisfied that the proposed development will be consistent with the objects of the standard which is not met; and
3. The consent authority must be satisfied that the written request demonstrates that compliance with the development standard is unreasonable or unnecessary in the circumstances and there are sufficient environmental planning grounds to justify contravening the development standard.
It is only if all of these conditions are met that consent can be granted to the application, subject to an assessment of the merits of the application.
The Commissioner applied the now familiar approach to determining consistency with zone objectives by considering whether the development was antipathetic to the objectives. Like most zone objectives, the R2 zone objectives were relatively general. They did not specifically relate to building height and, although the objectives referred to the provision of housing within a low density residential environment, that term was not defined. The Commissioner accepted that the proposed development was consistent with the zone objectives.
The Commissioner was also satisfied that the proposed development was consistent with the relevant objectives of the height controls, accepting that the development was both compatible with the character of the local area and would avoid any overshadowing impacts. The LEP did not include any specific objectives for the density standards and, although the development control plan did contain provisions which addressed density, these were in conflict with the density controls in the local environmental plan and were of limited assistance.
The Commissioner went on to find that there were sufficient grounds to justify contravening both development standards in this case and approved the application on its merits. However, in contrast to four2five, the reasons relied on to justify the departure from the standards in this case were not necessarily site specific.
The decision in Zhang follows another recent case, Randwick City Council v Micaul Holdings , in which the Court allowed a departure from development standards in comparable circumstances. Provided the processes required by clause 4.6 are followed, it therefore seems that a consent authority has a broad discretion as to whether to allow a departure from development standards under clause 4.6, even where the variation is not justified for site or development specific reasons.Read more
Small businesses will soon enjoy the benefits of protection against unfair contract terms, previously available only to consumers, following Royal Assent given to the Treasury Legislation Amendment (Small Business and Unfair Contract Terms) Bill 2015 on 12 November 2015. The Legislation will apply from 12 November 2016, giving businesses nearly 10 months to make sure their contracts are compliant.
Currently protection from ‘unfair contracts’ is only available to consumers who enter into standard form contracts under Part 2-3, Schedule 2 of the Competition & Consumer Act (2010) (Cth). Yet, small business can be just as vulnerable to unfair terms and standard form contracts as consumers. Small businesses can lack the bargaining power to successfully negotiate changes to the terms of contracts or may simply lack the resources to identify unfair terms and understand their legal and practical risks. The Government has described the amendments as one which will “level the playing field in commercial transactions”.
Under the Legislation, a small business will be able to seek relief with the courts being able to strike out terms considered unfair. The protection would apply to businesses with fewer than 20 employees at the time of the transaction and the upfront price payable under the contract is either:
The Legislation does not propose to amend what an unfair contract term is, but simply extend the right to claim that there is an unfair term by small business.
Pursuant to section 24 of the Act, a term is unfair if:
However, all three limbs of the test must be made out, and the court must consider the contract as a whole before a term will be deemed ‘unfair’. Unfair terms can include terms permitting unilateral changes by one party, terms limiting the rights of one party, terms which penalise a party for breach and terms which permit the assignment of a contract to the detriment of the other without their consent.
Standard form contracts are usually template documents produced by one party and offered on a “take it or leave it” basis. Sometimes, but not often, standard form contracts can be one-sided and contain rights that go beyond the requirements to legitimately protect the drafter’s business interests and may, in fact, cause detriment to the other party.
In determining whether a contract is a standard form Courts will consider:
The Legislation will affect all contracts made on or after 12 November 2016, and will also apply to existing contracts that are renewed after this date. Businesses have a one year grace period to review and amend their existing standard form contracts to ensure compliance.
Obviously we recommend seeking advice on your contract terms if you are unsure about the legal or practical implications however the extension of the unfair contracts regime will provide comfort to small businesses that cannot afford to negotiate or seek such advice on its contracts.
On 5 May 2016in EPA v Terrace Earthmoving PL (No 3)  NSWLEC 50 (Terrace No 3) the Land and Environment Court (LEC) found Terrance Earthmoving Pty Ltd and its sole director guilty of four related offences under the Protection of the Environment Operations Act 1997 (Act) of transporting building waste material to a place that cannot lawfully be used as a waste facility even though the material was ultimately being reused in road construction. This decision is noteworthy for those seeking to reuse, recycle or recover scrap demolition material in New South Wales.
The case concerned the actions of Terrace Earthmoving who carried out demolition and excavation work to various buildings. The company removed unwanted by-products, consisting of crushed rock, broken bricks, tiles and concrete and then transported them for use in the construction of a road on private land. Despite the materials being reused, the finding of guilt was based on the Court’s finding that the demolished building materials were waste because they were unwanted by the original owners of the demolished buildings.
The outcome follows earlier decisions of the LEC and NSW Court of Criminal Appeal in the case. The earlier decisions concerned whether the material removed and transported should properly be considered ‘waste’ within the meaning of the Act. In the first instance, the LEC considered that the material was not waste because, amongst other things, the material was not unwanted or surplus as it was intended to be reused for road construction. However, the NSW Court of Criminal Appeal overturned that decision and held that it is immaterial whether the end user or transporter had a use for the material. Rather, the Court of Criminal Appeal determined that transported material will be waste for the purposes of the Act if the original owner of the material had no continuing use for it at the time of the material is transported.
In Terrace No. 3, the LEC applied the findings of the Court of Criminal Appeal to the evidence that was presented by the EPA. It found that the transported material was waste because it was clearly unwanted by the original owners of the buildings being demolished, regardless of whether the material was sorted or crushed onsite prior to transportation to be used for other purposes. It then went on to consider whether the land where the road was being constructed by Terrace Earthmoving could, at the time the waste was deposited, be lawfully used as a waste facility for that waste. In finding that it could not, the LEC noted that there was no licence under the Act or development consent under the Environmental Planning and Assessment Act 1979 to use the property as a ‘waste facility’ and that both of these authorities were required.
The matter has now been listed for a sentencing hearing where Terrace Earthmoving and the director of the company face maximum penalties of $1 Million and the $250,000 respectively.
This decision is an important reminder of how broad the concept of waste is – and the potentially serious consequences for persons who transport or source waste material for reuse, recovery or recycling waste from or into New South Wales without obtaining the necessary approvals.Read more
Bradley Allen Love Legal Director John Wilson was recently interviewed on the Privacy of Public Servants by ABC Radio National for their Background Briefing program.
The Fair Work Commission has ruled that Centrelink’s decision to sack an employee for anonymous posts critical of the department on a discussion group was a “gross intrusion on the private lives of public servants”.
The Department is now appealing. What a public servant is free to say is now being fought in the courts.
Legal Director John Wilson says Daniel Starr’s case is important for a couple of reasons, mainly because the Commission makes a distinction between senior and lower level public servants, and spells out how admin workers are unlikely to derail government policy, no matter how critical they are online. Listen to the full interview below.
Interview conducted by ABC, more information available here.Read more
It’s a common scenario: you’re owed money and your debtor is refusing to pay. Surely the next step is to protect your debt by lodging a caveat over the land they’re sitting on, right? Wrong. The mere existence of a debt is no basis for lodging a caveat. If you lodge a caveat without reasonable cause, then you could end up compensating your debtor for your actions.
A caveat is a form of statutory injunction; a ‘notice to beware’ that flags to the world that someone other than the property owner holds an equitable interest in the land. Where properly lodged and recorded on the property title, a caveat will thwart registration of any other interests, and prevent the property from being transferred or otherwise dealt with until the caveat is removed; it effectively freezes all dealings with that property.
However, before you can properly lodge a caveat, you must have a “caveatable interest”. Whilst there is no comprehensive definition of that term under ACT law, it must always constitute an “interest in the land”. This could be a purchaser protecting their interest pursuant to a sale contract before the purchase is settled, a trustee registering an interest held pursuant to a trust deed, a charge granted over your property as part of a guarantee, or a formal or informal mortgage. The mere existence of a debt will not be sufficient. A debt does not give the creditor any proprietary interest in the land, being merely a contractual right to sue for the return of the money. A debt is not a caveatable interest.
If you register a caveat without a valid caveatable interest, the Land Titles Act 1925 (Act) confirms that you could be liable to pay “just compensation” to the owner. Such compensation could extend to the owner’s legal costs or far more where a sale or lease of the property is lost or delayed. If you’re considering extending credit or entering a credit arrangement with a customer or client, and want to ensure you have a “caveatable interest”, then make sure you get security over the land at the outset, upfront and in writing. Such security is much more likely to be granted at the time the credit, goods or services are provided, than later on when things go wrong. If you’ve got developing concerns about an existing debtor, ask for additional security before granting further credit. Be proactive and protect yourself early; if you wait until the money runs out, then you could be out of luck.
First published in B2B Magazine.Read more
The right to criticise government should be protected, not punished, in a liberal democracy.
The Fair Work Commission’s recent reinstatement of a long-serving Centrelink officer is a blow to the federal government in its ongoing battle over its ability to regulate the private lives of APS employees. Yet the Department of Human Services’ decision to appeal suggests it will not give up without a fight.
Over the past decade, frontline Centrelink employee Daniel Starr had anonymously posted work-related comments on internet forums out of hours. Most were of a helpful nature, advising benefit applicants of likely processing times, although some were undoubtedly objectionable: at one point Starr labelled clients “spastics and junkies” and on another occasion he said he was “embarrassed to work” at Centrelink.
Starr’s troubles began when he began contradicting a departmental social media officer who posted on the same forum. The officer repeatedly said that the estimated processing time for certain applications was 21 days, while Starr explained that the target had in fact been changed to 42 days. Although his posts were forthright – “Please Flick, you need to stop giving this incorrect information” – they were hardly rude. Read the full article here.Read more
It has now been over four years since the Personal Properties Securities Act 2009 (Cth) (PPSA) took substantive effect on 30 January 2012.However, many businesses remain oblivious to the PPSA register and the serious consequences that can follow its oversight. So what is the PPSA and what is the risk in ignoring it?
The PPSA established a new, national system for managing and recording all secured lending over personal property. For businesses, it applies to stock and inventory, plant and equipment and vehicles. If your business sends out or receives ‘property’ on consignment, allows suppliers to take goods on credit or accepts such property as security for outstanding debts, then you need to understand the PPSA. If you ignore the PPSA on the basis that “it doesn’t affect me” or “this is how I’ve done business all my life, I’m not going to change”– then you’re likely to lose.
The PPSA created a system of priority for secured and unsecured creditors. It is effectively a ‘first registered, best dressed’ policy, whereby the first creditor to register generally takes primacy over later creditors (registered or unregistered). This means that if your business hasn’t registered its “security interests” on the Personal Property Securities Register (PPSR), then you could miss out when it comes to reclaiming the property you have title to or security over.
A basic example will help to illustrate this concept:
Your company imports and assembles bicycles. You sell some to “Bike Co” on credit. Your terms and conditions state that “We retain all title to the bicycles until invoices are paid in full” but you do not register a security interest on the PPSR. You have transferred possession but not ownership of the bicycles to Bike Co.
Bike Co goes under and appoints a liquidator. You try to get your bicycles back but the liquidator claims they are now owned by them.
Under the old system, if your invoice asserted ownership until goods are fully paid, you could probably get your bicycles back. But under the PPSA, you lose ownership because you failed to protect your ownership rights and obtain “secured creditor” status by registering a security interest. Any Bike Co property which is unencumbered by a perfected (registered) security interest now vests with the liquidator (Corporations Act 2001, section 588FL). If you had registered, then you would likely take priority over the liquidator and recover your property.
The danger for businesses which ignore the PPSR is clear: if you fail to register, you may get nothing, not even your own property. If you’re still saying “Huh?” to the term ‘security interest’, PPSA or PPSR, then seek advice and get your interests registered soon to help protect your business and your livelihood.
First published in B2B Magazine.Read more
Bradley Allen Love are pleased to announce that four of its Legal Directors have been recognised for their legal excellence in the latest edition of Best Lawyers. Produced by a peer review company and published by the Australian Financial Review, the list is compiled following an extensive evaluation process.
For the seventh consecutive year Alan Bradbury (Government Practice and Planning and Environment Law) has been acknowledged for his expertise. Managing Legal Director John Wilson makes his fourth appearance in the list (Labour and Employment Law, Occupational Health and Safety Law), while Mark Love (Commercial Law, Insolvency and Reorganisation Law) and John Bradley (Leasing Law, Real Property Law) were again recognised for their respective practices.
Wilson congratulated his fellow Legal Directors on their achievements.
“A listing in Best Lawyers is a considerable honour, reflecting as it does the praise of fellow practitioners in each speciality,” he said. “For three of my colleagues and I to be included speaks highly to the calibre of our team at Bradley Allen Love.”
Best Lawyers is the oldest and most respected peer-review publication in the legal profession. A listing in Best Lawyers is widely regarded by both clients and legal professionals as a significant honour, conferred on a lawyer by his or her peers. For more than three decades, Best Lawyers lists have earned the respect of the profession, the media, and the public, as the most reliable, unbiased source of legal referrals anywhere.Read more
‘The statutory regime that governs the realm of corporate insolvency and personal bankruptcy has long been a point of contention between the business community and regulators, a balancing act that each side felt too often erred in favour of the other. The recently published recommended changes to Insolvency Laws, introduced as part of the Commonwealth’s National Innovation & Science Agenda, foreshadow a ‘cultural shift’ in this regard, but gave scant detail as to what the Government is actually proposing to do.¹ At this stage, all we know is that it wants to strike “a better balance between encouraging entrepreneurship and protecting creditors by:
• Reducing the current default bankruptcy period from three years to one year;
• Introducing a ‘safe harbour’ for directors from personal liability for insolvent trading if they appoint a restructuring adviser to develop a turn around plan for the company;
• Making ‘ipso facto’ clauses [allowing contract termination for insolvency] unenforceable if a company is undertaking a restructure.” ²
A proposal paper will be released in the first half of 2016 with legislation to follow by mid-2017; and so we are, for the present, left to anticipate what will be offered.
Whether or not the changes are retrospective, it will be the existing contractual arrangements and structures that you have in place when these laws come into effect which will determine the degree to which you, as a creditor, are affected and to what extent you “lose” as a consequence of any “loosening” of the rules.
The core answers to mitigating potential loss when dealing with persons or corporations facing insolvency remain unchanged:
1. Know who you are trading with;
2. Make sure any credit terms are tight, tidy and capable of enforcement;
3. Take security – hold guarantees, charges and make sure those interests are registered; and
4. Keep your debtor balances within a manageable range – overextending credit increases your problem and postpones theirs.
The unforeseen losses suffered by traders whose clients fail to pay a debt have a flow on effect and, as the economy tightens, the effect becomes more so. Pre-empting risk is what good “innovators” do, and steps should be taken to protect your valuable cash flow.
It is encouraging that the Government might introduce changes that allow corporate restructures before that step into the great unknown of “Administration” or “Liquidation”, but for most of us, we need to remain vigilant in reducing the risk we might otherwise unwittingly assume through our associates’ risk taking behaviours.
First published in B2B Magazine.
1 http://www.innovation.gov.au/page/agenda (released 8 December 2015).
The key benefit of a company structure is the separate legal personality that the company has from its controllers (directors) and its owners (shareholders) and the protection given to those individuals if the worst occurs and the business goes bust; but if you think that a director therefore has no liability, you are mistaken.
We often hear about instances of director liability for breaches of directors’ duties (trading whilst insolvent for example). However there are more obvious (although less talked about) instances of personal liability that directors may overlook; consider personal guarantees and incorrectly signed contracts.
Where suppliers or financiers are concerned about a company’s ability to repay its debts, they may request personal guarantees. These can expose a director’s personal assets. For multiple directors, the guarantees could be joint and several. So whilst a director may believe she/he is ‘equally liable’ with fellow directors, nothing prevents a creditor pursuing only some (or even one) of the guarantors. In such cases, creditors are inclined to pursue the guarantor with the greatest apparent wealth.
There are two particularly dangerous aspects of personal guarantees:
Ceasing to act as a director may not and typically does not release you from your guarantees. It requires active steps to achieve the release of a guarantee. A guarantee is a separate contractual assurance.
Directors should also be wary about signing contracts incorrectly, where the danger of personal liability again looms overhead. In the recent decision of Knight Frank Australia Pty Ltd v Paley Properties Pty Ltd  SASCFC 103, the Court made it clear that an agent incorrectly purporting to have authority to contract on behalf of their principal will be personally liable. If a director executes a contract as “company agent”, rather than signing as the company itself, that director warrants that they have the appropriate authority to enter that contract. The Knight decision highlights that directors could be liable if that authority proves faulty and the company fails to adopt the contract.
For directors, the scope of personal liability extends beyond a breach of director’s duties. Signing a personal guarantee or incorrectly signing a contract can be just as dangerous. Ensuring you’re appropriately released from obligations and have proper authority to deal on behalf of the company can help you steer clear of that road to (personal) ruin. If you have concerns as to your personal exposure as a director, seeking professional advice early can help mitigate the risks.
First published in B2B Magazine.Read more
Debt and debt management seems to conjure up images of dread and sometimes this is for good reason.
Dun & Bradstreet have recorded that invoice payments are reaching a record pace in 2015, with average payment dates being 50.4 days Australia-wide and 53.3 days in the ACT1. That is a significant amount of time for businesses to be exposed to a reduced cash flow and reduced profit margins while seeking to maintain a strong financial position and grow their business.
There are three aspects of debt and debt management – the good, the bad and the ugly. The discerning business owner should understand and develop a healthy respect for all three, from proactive debtor management to the risks of insolvency and ‘stick’ of director liability.
Two of the statistics by Dun & Bradstreet’s recent report are particularly revealing:
…46 per cent of businesses would choose to miss a payment to a trader supplier if without enough money to cover all of their expenses. …34 per cent of businesses have had a customer or supplier become insolvent or otherwise unable to pay them during the past year.
A person or entity is insolvent if they are unable to pay all of their debts, as and when they become due and payable2. With 44%3 of commercial invoices in Australia being paid late, a large number of businesses are at risk.
Bad debt management can cause your business to suffer financial constraints which, if not dealt with early and effectively, can also lead to its demise. Worse still, if a business owner ignores those constraints, continuing to trade without implementing strategies to reduce their debt and exposure, then they risk engaging in “insolvent trading”, which puts personal assets on the line to satisfy creditors, chief amongst them the ATO.
Implementing efficient business systems to better manage these debts through early identification and prompt collection of overdue accounts can lead to improved cash flow and stronger financial positions.Read more
Bradley Allen Love Lawyers recently assisted a client to resolve a dispute at the earliest stage with the minimum of fuss. There is nothing unique about that achievement, which accords with the aim to facilitate the just resolution of the real issues in civil proceedings with minimum delay and expense. What this matter highlighted, though, is that it is essential to use lawyers that know how to recognise when a fight is worth having and have the capability to meet that challenge.
The client was starting up his small business. He had previously been employed in a similar franchised business and decided to go into the industry himself. His start up business was a significant family investment and he wanted to ensure that it was successful. He initially made the mistake of giving his business a similar name to that of the franchised name of his former employer. This brought him to the attention of the franchisor, who demanded that he change the name of his business.
Realising his error, the client changed his business name and proceeded with his business. Despite the change of business name, the franchisor then sued him for breach of a purported restraint of trade provision and also alleged that he was passing off his goods as though they were the franchisor’s goods.
The franchisor had legal representation. In contrast, the client initially did not have representation because he was aware of the significant cost involved. The client did his best to conduct the matter; however, it was a distraction from his business and caused him great concern for his family’s investment. Eventually his son persuaded him to seek professional advice in relation to the claim, which by now had a hearing date set. The client realised his limitations and made an appointment to see Bradley Allen Love.
Here was a new business operator who was facing a significant claim that threatened to ruin his business and his family investment.
After reviewing the claim and the supporting documents, it was immediately apparent to Bradley Allen Love that the franchisor’s claims were all fundamentally flawed. It was time to resolve the matter before the costs began to mount for either party.
After filing a defence that refuted each of the franchisor’s allegations, the client made a settlement offer to resolve the dispute. The settlement offer explained the client’s position and utterly dismantled each of the franchisor’s allegations. The franchisor accepted the offer. Fortunately, both parties are now able to put the matter behind them and get on with their respective business.
If you have a commercial dispute, seek professional help at an early stage. Make sure you seek that help from a suitably experienced lawyer. Ideally, seek advice from an Accredited Specialist in Business Law; better still, if that specialist has access to an Accredited Specialist in Commercial Litigation.
Bradley Allen Love has both.Read more
Sutherland Shire Council v Sud  NSWLEC 44 (24 August 2015)
The Land and Environment Court’s decision in Sutherland Shire Council v Sud serves as a useful reminder of the underlying principles, and key differences, between criminal prosecution and civil enforcement proceedings available under the Environment Planning and Assessment Act 1979.
A key feature of this case was the Council’s decision to utilise both mechanisms against the Respondents in relation to development that had been carried out otherwise than in accordance with the development consent. The Court ultimately endorsed the Council’s approach as it acknowledged that the consequence of one action was to punish the offender, while the other was aimed at remedying the environmental harm caused by the breach. The order in which criminal and civil proceedings are taken is, however, of fundamental importance in achieving these desired outcomes.
Before the Council commenced civil enforcement proceedings in the Land and Environment Court it had prosecuted Mr Sud in the Local Court in relation to the unauthorised development. Mr Sud entered a plea of guilty and the Local Court convicted him and ordered him to pay a fine in the sum of $30,000.00 as well as the Council’s legal costs in the sum of $9,634.00.
In responding to the Council’s civil enforcement action, the respondent argued that bringing civil enforcement proceedings under section 123 of the Act was an abuse of process because the statutory scheme required the council to elect to either prosecute for an offence or to seek civil enforcement, but not both. To find otherwise, it was argued, would result in a “double punishment”.
The respondents’ argument was based on their construction of section 127(7) of the Act. That provision is in the following terms:
(7) A person shall not be convicted of an offence against this Act or the regulations where the matter constituting the offence is, at the date upon which the conviction would, but for this subsection, be made:
(a) the subject of proceedings under section 123, which proceedings have not been concluded, or
(b) the subject of an order made under section 124.
Proceedings taken under section 123 and orders made under section 124 are civil enforcement proceedings.
The Court rejected the respondents’ argument and held that section 127(7) does not require a council to make an election between criminal prosecution or civil enforcement proceedings. However, the Court confirmed that a council needs to think carefully about whether, and when, to commence civil enforcement proceedings because the commencement of civil enforcement proceedings under section 123 or the making by the Court of an order remedying or restraining a breach of the Act under section 124 will prevent a council from subsequently taking criminal action for an offence based on the same breach. The Court explained that the basis for this restriction is enshrined in the procedural fairness principles applicable to a criminal prosecution, such as the right to silence. Procedural fairness precludes a criminal prosecution (which must be proved to the criminal standard of “beyond reasonable doubt”) taking place if the issues have already been aired and decided in a civil case (where the relevant standard is lower: “on the balance of probabilities”).
In coming to this decision, the Court discussed the different purposes of criminal proceedings and civil enforcement proceedings. The Court explained that criminal proceedings are intended to punish the offender, to deter both the offender and others from engaging in similar conduct in the future, to publicly denounce the offender’s behaviour and to recognise the relative harm caused by the offence in the sentence imposed.
By contrast, the Court observed that civil enforcement proceedings are intended to remedy or restrain breaches of the Act and do not involve any element of punishment. This led the Court to conclude that the statutory scheme did not expose a person to “double punishment” and that the commencement of civil enforcement proceedings following a successful prosecution did not amount to an abuse of process. It was open to the council to take both criminal proceedings and civil enforcement proceedings in relation to the same incident provided the criminal proceedings were dealt with first.
Manly Council v Leech  NSWLEC 149 (17 September 2015)
This case is yet another in which the poor drafting of an order has led to the Court holding it to be invalid. The order in this case was an order given under section 121B of the Environmental Planning and Assessment Act 1979; however, the Court’s findings apply with equal force to orders given under section 124 of the Local Government Act 1993.
When giving notice of a proposed order and also when giving an order, it is very tempting to cut and paste from earlier notices and orders given by the council. As this case demonstrates, this can be dangerous. It is very important to make sure that the information contained in a notice of proposed order is the information required to be included in such a notice and that the recipient is being given an opportunity to make representations about whether the order should be given and, if so, in what terms. Likewise, it is essential that the information contained in any subsequent order is clear and unambiguous and does not create any confusion about whether it constitutes an order that must be complied with or is simply notice of an order that the Council is intending to give in the future.
The order the subject of the Court’s decision in Manly Council v Leech was a “stop work” order given pursuant to item 19(a) of the Table to section 121B. While it is open to a council to give notice of a proposed order pursuant to item 19 of the Table to section 121B (and it will often be good practice to do so), the Act does not require notice to be given of such an order: section 121D(a).
The “order” the subject of the proceedings was in the following terms:
ENVIRONMENTAL PLANNING & ASSESSMENT ACT 1979
SECTION 121 B
TAKE NOTICE that Manly Council (“Council”) intends to give to you an Order in terms of Order No 19(a) in the Table to Section 121B of the Environmental Planning and Assessment Act 1979 (“the Act”) in the terms set out below on the grounds that building works are being carried out unlawfully in contravention of the Act. [emphasis added]
Below that there followed a page and a half of words under the headings: Schedule of Works, Time Period for Compliance with Orders, Reasons for Order, Offence, Penalty, Execution of Order by Council, Right of Appeal Against Order, and Orders that Make or are Likely to Make Residents Homeless.
The Court observed that a statutory order requiring someone to do, or not do, something that is subject to penal consequences will be strictly construed. Consequently, the validity of such an order depends on strict compliance with the statutory conditions governing its issue, and it will not be enforced by the Courts unless the order is expressed in clear and unambiguous language.
In the present case, the Court pointed out that the document began by stating that the Council “intends” to give an order. It was framed in terms of an order the council intended to give in the future and the Court found that this led to confusion about whether the Council required immediate compliance with the order or whether it was merely giving some sort of warning notice. In those circumstances the Court held that the order was invalid.
This case serves as a timely reminder for councils to review the template documents they use for the giving of notice of proposed orders and for giving orders to ensure that, if challenged, they will stand up to scrutiny by the Court.Read more
Then put together your team/s and start training now to compete in Sweatworking ® – our physical challenge networking event. With a new date, new venue and new charity partner – Duo Services – this event is set to be bigger than ever!
Your organisation’s team of 4 will complete 10 fitness stations – each with its own unique challenge. Our fitness partner Ignite Nutrition and Fitness have devised a gruelling circuit style program – the more reps, the more points! All of your team registration fee will be donated to DUO, our 2015 Charity Partner.
We hope to see you there!
ActewAGL | Beames and Associates | Bradley Allen Love | Canberra Labor Club Limited | Cataldos | Colliers International | Commonwealth Bank of Australia | Construction Control | Deloitte | Godfrey Pembroke | Kazar Slaven | KPMG | Land Development Agency | Lifeline Canberra | Ray White | RSM Bird Cameron | Schiavello (ACT) Pty Ltd | The Vikings Group | Trilogy Funding | University of CanberraRead more
Christmas in July has come and gone, marking the end of another round of workplace celebrations, and the slow march back from solstice to silly season. During this intervening period of calm it is perhaps timely to remind employers and employees alike of the perils and pitfalls of the infamous work Christmas party.
Such events are intended to allow staff to mix and mingle while celebrating all that was achieved over the course of the year. Yet often it is also used as an excuse to take advantage of a bottomless bar tab, and an excess of social lubricant has been known to cause some slip-ups.
The recent case of Keenan v Leighton Boral Amey Joint Venture provides a stark illustration of what can happen when an employer fails to take the proper precautions before, during, or after a Christmas work party. Some may also learn lessons from Mr Keenan’s conduct.
The Keenan case involves an employee who helped himself to the unlimited supply of alcohol at a staff Christmas function before embarking on what could be described as a “rampage” of misconduct, swearing at managers and making overt sexual advances to female colleagues. The employer dismissed Mr Keenan in the New Year, but the Fair Work Commission (FWC) ordered his reinstatement on the basis that much of the conduct occurred “out of hours”.
Mr Keenan was a ‘Team Leader’ for his employer, Leighton Boral Amey Joint Venture (LBAJV), a company which carries out road maintenance work in Sydney under a contract with the NSW Roads and Maritime Services. LBAJV held a Christmas Party at a hotel between 6pm and 10pm in December 2014. Before the party, the employees were warned that LBAJV’s policies and procedures were to apply during the function.
During the party (which was not supervised by any LBAJV manager), the hotel staff were obliged to serve alcohol in compliance with their responsible service of alcohol requirements. However, in practice, the service of alcohol was not appropriately restrained or regulated, to the point where later in the night the attendees were simply left to help themselves.
Mr Keenan certainly did “help himself”, downing around ten beers and one vodka and coke between the hours of 7pm and around 11:15pm. Read More.
First published in Ethos, the ACT Law Society’s journal.Read more
The wait is over – amendments to the Environmental Planning and Assessment Act 1979 which confer significantly improved investigation powers on Councils commenced on 31 July 2015. The amendments also create new offences and establish a new hierarchy of offences which attract higher penalties and distinguish between offences committed by individuals and corporations.
The amendments to the Act are supported by amendments to the Environmental Planning and Assessment Regulation 2000 (Amended Regulations) which also came into force on 31 July 2015. The Amended Regulations contains important transitional provisions and a revised schedule of penalty notice offences including higher penalties.
The new provisions expand the powers of an “investigation officer” bringing them in line with the powers of an “authorised officer” under the Protection of the Environment Operations Act 1997. Relevantly, the new provisions enable an investigation officer to:
These provisions allow councils significantly greater scope to obtain information and evidence in relation to investigations into possible breaches of the Act.
The amendments also provide that an investigation officer is now able to commence criminal proceeding within, but not later than, 2 years after the date on which evidence of the alleged offence first came to the attention of that investigation officer: section 127(5A). Prior to the amendments, this provision had only applied to authorised officers of the Department.
The new provisions have moved away from the terms “a person authorised” and “authorised officer” and instead confer powers of investigation on an “investigation officer”. That term refers to both departmental officers and council officers, unless otherwise specified.
An “investigation officer” is a person appointed in accordance with s.119B. The requirements for appointment vary depending on whether the appointment relates to an individual or a class of persons. Relevantly:
To date the Minister has not authorised a class of persons as “investigation officers” for the purpose of s.119B of the Act. As such, in order for council officers to rely on the new investigative powers of the Act, councils must ensure that relevant council officers are formally appointed, in writing, as an investigation officer.
However, the Amended Regulations provide that Council officers who were authorised by a council under s.118A(1) of the Act, being an authorisation to enter any premises, immediately before the commencement of the new provisions will be taken to be a “council investigation officer” for the purposes of the amended Act.
While this assists existing council staff who were authorised persons under the unamended Act, as the Council’s power to appoint an investigation officer under the Act did not previously exist, Councils will need to delegate the new power to their general managers before general managers will be able to make new appointments to the position of investigation officer.
The new provisions also create new offences. It is now an offence to:
The introduction of this new offence allows councils to take action against persons who are indirectly involved in a contravention of the Act or Regulations, rather than just a person who was directly responsible for an offence. A person aiding, abetting etc an offence will be subject to the same penalty as the person who directly committed the offence.
A further new offence is to be created in relation to the provision of false or misleading information in connection with a planning matter but that offence will not commence until 30 September 2015. The new offence will be contained within section 148B and will apply to both applicants and consultants.
The new provisions of the Act are backed up by significantly higher maximum penalties which vary depending on the seriousness of the offence. In this respect the Act now lists three categories of offences. The hierarchy this creates provides clear guidance to councils, the courts and the community about which offences are deemed to be more serious than others.
The Act now also imposes higher penalties for offences committed by corporations than those for individuals.
The Amended Regulations include a revised schedule of penalty notice offences which is consistent with the new penalty regime of the Act (Schedule 5). The new schedule introduces additional items to the list of penalty notice offences and increases the penalty amount for most offences. The most serious offences are now subject a penalty notice amount of $6,000 for corporations and $3,000 for individuals, e.g carrying out designated development without consent. The changes to the penalty notice provisions commenced operation on 14 August 2015.
Please contact Alan Bradbury if you have any queries about the application or effect of the new provisions of Act or Amended Regulations.Read more
The oppressive conduct regime in the Corporations Act 2001 (Cth) (the Corporations Act) is designed to provide protection and extensive remedies for oppressed minority shareholders. It is one of a number of means to ensure Directors conduct the company’s affairs in good faith and in a manner which is in the interests of all shareholders.
Sections 232 and 233 of the Corporations Act allow shareholders to seek relief against oppressive conduct in circumstances where the conduct of the company’s affairs is alleged to be:
The Court has broad powers under section 233 to grant relief to oppressed shareholders, including the power to wind up the company, appoint a receiver/manager, grant injunctions and, importantly, providing for the buy-out of shareholders.
The question considered here is whether “unitholders” of a unit trust can seek the same relief as “shareholders” under those provisions. The law in this respect is uncertain; hence the importance of having a Unitholders Agreement or equivalent right in the unit trust deed. The uncertainty arises because the jurisdictions of NSW and VIC have taken different positions on whether unitholders can seek relief under the oppressive conduct provisions of the Corporations Act, even where there is a corporate trustee.
The NSW approach is that claims of oppression and entitlement to relief under the Corporations Act are limited to the company only, and does not apply to its capacity as a trustee in the course of administering the trust. This is so, notwithstanding that the sole purpose of the company may be to act as trustee. Even where oppression has occurred against a trust beneficiary in a company which holds all its assets on trust, there is no diminution in value of the complainant’s share in the company (the shares in the company being valued at nil or the nominal amount of $1) and therefore no prejudice or unfairness occurs.
Plainly, the NSW position is that “oppression” against a beneficiary of a trust is a matter to be raised as “a breach of trust” not a Corporations Act cause.
Victoria has departed from the NSW approach in that Courts will look at the conduct of the majority unitholders “as a whole” regardless of whether the conduct relates to their position as a shareholder or as a unitholder or both. The Courts have considered the application of section 53 of the Corporations Act in the interpretation of the oppression provisions.
For conduct to be oppressive it must be in relation to the “conduct of a company’s affairs’. Section 53 provides that “affairs of a body corporate” include:
It has been held that section 53 is broad enough to extend to the oppression remedy where the oppression relates to the operation of the trust which has a corporate trustee and potentially extends oppression of a member to include their interests and associated interests as a “unitholder”. Even if that was so, it nevertheless may be that in many cases it is possible to separate the affairs of the company from those of a trust. Whether that can be done depends on the facts.
Unfortunately the ACT approach is unclear as the issue appears untested. In our view the NSW approach is likely to prevail for reason that a corporate trustee is bound to act in accordance with the Trust Deed and if the Trust Deed does not set out conduct which (if reached) could be unconscionable, then the corporate trustee cannot be engaging in unconscionable or oppressive conduct separately. Our view is that the rights of a beneficiary under a trust are determined according to the terms of the trust and the law of trusts.
Whether the laws of oppression reliant on the Corporations Act 2001 apply or don’t apply should be an academic question. The advantage in having a Unitholders Agreement is that if the document is well prepared, there will be clear rights and obligations on each of the parties to identify what conduct is or is not acceptable, reducing or even removing the possibility of claims of oppression and providing unit holders with a clear path out of the unit trust. If a business is designed to be an investment it should also be designed to be realised.
This article is intended to provide a summary of the subject matter only. It does not purport to be comprehensive or to render legal advice. No one should act on the basis of any matter contained in this article without first obtaining specific professional advice.Read more
The making or amendment of an environmental planning instrument will sometimes affect the value of land owned by a councillor, giving rise to a “pecuniary interest” for the purposes of the Local Government Act.
When this happens, the Act requires the councillor:
a) to disclose the nature of the interest to any meeting of the council or committee at which the matter is being considered (section 451(1)); and
b) to not be present at, or in sight of, the meeting at any time during which the matter is being considered or discussed or voted on (section 451(2)).
These obligations are in addition to the obligations relating to the preparation and submission of written returns of interests under section 449.
When the making or amendment of an environmental planning instrument will affect the value of land owned by a number of councillors, there is the potential for the council to be unable to obtain a quorum for a council or committee meeting convened to consider the instrument. To deal with this issue, section 451(4) provides that the obligations imposed by section 451(1) and (2) do not apply if:
a) the environmental planning instrument applies “to the whole or a significant part of the council’s area”; and
b) the councillor makes a special disclosure prior to the meeting.
The provisions of section 451(4) came under the spotlight in the recent decision of the NSW Civil and Administrative Tribunal in Office of Local Government v Petty  NSWCATOD 46.
The issue in that case was whether Cr Petty, a councillor on the Wollongong City Council, had breached the pecuniary interests provisions of the Act.
The Council held an extraordinary meeting to consider a number of rezoning proposals for land at Helensburgh and Stanwell Tops. Although there were a number of such proposals, each one was listed separately in the Council’s business paper. One of those proposals, item 8 in the business paper, related to a property known as “the Blackwells” which was across the road from Cr Petty’s home. The proposal was to rezone part of the Blackwells property from E2 Environmental Conservation to IN2 Light Industrial. Evidence before the Tribunal indicated that, if approved, the rezoning proposal would have a detrimental impact on Cr Petty’s property and would result in the value of his land decreasing by some $175,000.
Cr Petty attended the council meeting at which the proposal was considered. At the commencement of the meeting he read from a statement prepared by his solicitors. He acknowledged in the statement that he owned land that would be affected by the proposal and that he may have an appreciable financial gain or loss depending on what decision the Council made. However, he then said that, because the proposal was part of a much larger overall rezoning proposal for a significant part of the Council’s area, he had decided to make a special disclosure and to take part in the meeting.
The councillor remained in the meeting and argued against the approval of the proposal. He then voted against the proposal.
In the Tribunal Cr Petty argued that he was not required to absent himself from the Council meeting because the matter being considered fell within the exception contained in section 451(4). He argued that the whole of the business before the Council that night related to zoning proposals for a significant part of the Council’s area.
However, the Tribunal found that the specific agenda item relating to the Blackwells related to an area of land that made up only 2.33% of the Council’s area and that this was not a “significant” part of the Council’s area for the purposes of section 451(4). It was this agenda item and not the whole of the business before the Council meeting, that gave rise to the councillor’s pecuniary interest.
Cr Petty also argued that he had obtained legal advice from a solicitor who was an accredited specialist in local government and planning law and relied on that advice in dealing with his pecuniary interest in the way he did. That advice was to the effect that, when all of the various rezoning proposals were taken together, they did affect a significant part of the Council’s area and this was sufficient to bring the circumstances with section 451(4).
The Tribunal disagreed with the councillor’s legal advice, noting that the rezoning proposal in which Cr Petty had a pecuniary interest was a separate agenda item, requiring separate consideration and to be voted upon separately. It did not come within section 451(4) because the specific proposal did not relate to the whole or a significant part of the Council’s area: it related only to the zoning of the Blackwells.
The Tribunal also found that the fact that the councillor had obtained and relied on legal advice was not an answer to the complaint against him. The Tribunal said that Cr Petty was not bound by the legal advice he obtained and it was a matter for him whether he relied upon it. The Tribunal concluded that regardless of the legal advice it was open to the councillor to give careful consideration to whether the specific proposal relating to the Blackwells was a “proposal relating to the whole or a significant part of the Council’s area” and, if there was some doubt about that, whether it would be prudent or more ethical for him to refrain from participating in the consideration of that item. The councillor was criticised by the Tribunal for adopting the legal advice as “an unqualified shield”.
Another issue relied on by the Tribunal was the technical point that the special disclosure had not been signed. Section 451(4) provides that a special disclosure must be in the form prescribed by, and must contain the information required by, the regulations. Regulation 195A of the Local Government (General) Regulation 2005 requires a special disclosure to be in the form set out in schedule 3A and to contain the information required by that form. The prescribed form requires, as part of that information, the signature of the councillor. The Tribunal also noted that the councillor’s legal advice also pointed out that the special disclosure needed to be signed to become effective. So even if the rezoning proposal had applied to the whole or a significant part of the Council’s area, Cr Petty would still not have been entitled to the protection of section 451(4) because he had not made the special disclosure required by that provision.
In the circumstances the Tribunal ordered that Cr Petty be reprimanded and suspended and that his right to be paid any fee or remuneration also be suspended for a period of 3 months.
In a decision handed down on Monday of this week, the Court of Appeal has found that councils must comply with the public notice requirements for the setting of fees for service in the Local Government Act even when the fees are paid pursuant to a contract and have been arrived at following commercial negotiation between the council and the other party to the contract.
The Local Government Act 1993 contains elaborate provisions regulating the financial management and accountability of local councils. Chapter 13, “How are councils made accountable for their actions”, requires the preparation of a delivery program and draft operational plan (including a statement of the council’s revenue policy for the year) and imposes an obligation on councils to exhibit and receive and consider submissions before a final operational plan is adopted.
A council’s revenue comes from a number of sources. One of those sources is the charging of fees for services.
The Local Government Act differentiates between fees for business activities and fees for non-business activities.
The fees for services provided in relation to any of a council’s business activities must be charged in accordance with a pricing methodology adopted by the council in its operational plan prepared under Part 2 of Chapter 13 or in accordance with a resolution passed at an open meeting of the Council: section 610B.
The fees for any non-business activity must be set by the council after considering the factors set out in section 610D. These include:
The transparency of the fee setting process is ensured by the requirements of section 610F. That section requires that a council must not determine the amount of a fee until it has given public notice of the fee in accordance with that section and until it has considered any submissions duly made to it during the period of public notice. The section also requires that public notice of the amount of a proposed fee must be given in the draft operational plan for the year in which the fee is to be made.
In a decision handed down on Monday 11 May 2015, the New South Wales Court of Appeal has held that the restrictions imposed on a council in charging a fee for a non-business related service apply to the grant of a licence for the use of council land, even where the fee has been arrived at by negotiation between the council and the licensee.
In Adrenaline Pty Ltd v Bathurst Regional Council  NSWCA 123 the council had entered into a five year agreement with Adrenaline under which Adrenaline agreed to pay the council an annual fee in the order of $250,000 for the use of the Mt Panorama motor racing circuit for 5 days each December. When negotiations for the renewal of the agreement collapsed, Adrenaline brought proceedings seeking to recover the fees it had paid over the five year term, arguing that it had paid the amounts in the mistaken belief that the Council had been authorised to enter into the agreement.
The council accepted that if the requirement to give public notice of a proposed fee for service in section 610F of the Act applied to the fees set by the agreement, public notice of the fees had not been given. The council argued, however, that it had a general power to enter into a contract in connection with the exercise of its functions and that this general power was not constrained by the public notice requirements contained in the Local Government Act.
The Court of Appeal rejected the council’s argument.
Leeming JA (with whom MacFarlan and Ward JJA agreed) held that the council was still required to comply with the public notice requirements of the Local Government Act in setting the fee payable under the agreement even though the fee had been the subject of commercial negotiations between the council and Adrenaline. He cited a number of reasons for coming to this conclusion:
The Court therefore found that the council had entered into the contract in breach of its obligations in relation to the charging of a fee for a service contained in section 610F of the Act.
Fortunately for the Council, however, the Court stopped short of ordering it to refund the licence fees it had been paid under the contract. This was for two reasons.
One was that the Court held that the fees were an “impost” for the purposes of the Recovery of Imposts Act 1963 so that the fees could only be recovered in an action brought within a period of 12 months from the date of payment. In this case the proceedings had been commenced after that period had already expired.
The second was that the Court found that Adrenaline had in fact received good consideration for the fees it had paid and, in fact, had received precisely what it had bargained for: the use of the racetrack for a 5 day period for each of the five years of the contract’s duration. The Court held that this precluded Adrenaline from recovering the amounts it had paid, even though they had been imposed contrary to the provisions of the Local Government Act.
The Court’s decision means that councils will need to review contracts they have entered into that involve the provision of a service (including licences for the use of council land) to ensure that the fees payable have been imposed in accordance with the public notice requirement of the Local Government Act. In this regard it does not matter that the fees may have been arrived at by negotiation with the other party – public notice of the fee is still required.Read more
On Tuesday 7 April 2015, Justice Nye Perram of the Federal Court of Australia handed down a landmark judgment which could change enforcement of copyright privacy forever. His Honour has compelled a number of internet service providers, including iiNet (the ISPs), to release the names and postal addresses of 4,726 of their customers whose IP addresses were used to illegally download the film Dallas Buyers Club. If the ISPs do not appeal the decision and the judgment stands, it will set a precedent that may encourage copyright holders to seek similar orders when looking to sue consumers for similar copyright infringement.
Dallas Buyers LLC and their parent company Voltage Productions LLC (together, Dallas Buyers), who own the copyright in the film, used software called ‘Maverik Monitor’ to trace the IP addresses of individuals who used BitTorrent networks to download the film. Dallas Buyers then applied to the Federal Court to compel the release of personal information of the account holders attached to those IP addresses.
Overseas, Dallas Buyers and other production companies have used such personal information to deliver what are known as ‘speculative invoices’ – threatening letters to the account holder, asserting that they are liable for a significant amount, but offering to settle for a much smaller amount (although still arguably more than what would be recoverable if they actually sued). In the United States, such “settlement fees” were known to reach up to US$7,000.
In this case, Perram J rejected the ISPs’ long litany of arguments and ultimately allowed Dallas Buyers’ application, albeit on two important conditions:
Those two checks are critical safeguards against Dallas Buyers’ ability to pursue the account holders for compensation in any way they see fit. The first was a matter of privacy; the second was to prevent speculative invoicing. With respect to the latter condition, Perram J followed the examples set by his peers in the UK and Canadian courts. His express purpose in doing so was to minimise the possibility of vulnerable individuals being frightened into paying a large settlement fee, after having received a menacing letter apparently resulting from court orders.
It is yet to be seen what form the Dallas Buyers correspondence might take, however under Perram J’s supervision they may only be permitted to seek compensation for their actual loss, which could be as little as the cost of the DVD or legal online purchase.
Moreover, if the letters do demand some sort of monetary compensation, if the account holder refuses to pay and if Dallas Buyers elect to sue, they will need to overcome a further and perhaps more significant hurdle: they will need to prove that the account holder of the IP address is the same person that illegally downloaded the film.
There are of course a number of possible scenarios in which they would not be the same person, and at that point the ‘Maverik Monitor’ software ceases to assist because it only traced the IP address of the account holder, and not the device onto which it was downloaded.
The expense that Dallas Buyers would incur in attempting to prove that fact in the course of litigation would far outstrip the amount they could potentially recover. Nevertheless that might not prevent them from making an example of someone as a deterrent for the wider public.
The judgement narrowly preceded the Communications Alliance, a lobby group for the telecommunication industry, submitting its Copyright Notice Scheme Code 2015 (the Code) to the Australian Communications and Media Authority for approval on Wednesday afternoon. The Code creates a ‘three-strikes’ system whereby copyright holders can trace illegal downloading using similar methods to Dallas Buyers, then compel the ISPs to issue warning letters to the relevant account holders. Three strikes in any twelve month period will allow the copyright holders to obtain the account holder’s personal information from the ISPs so that they can identify them for potential legal action. It is currently unknown if or when the Code will be approved.
If you receive an infringement letter from an ISP or production company, we strongly urge you to seek independent legal advice. At this juncture, steps must be taken with the utmost caution – the law in this regard is untested in Australia, and the courts are yet to determine how to appropriately balance the rights the copyright owners against the rights of individual consumers.
To read the full judgment click here.Read more
The Court is demonstrating its willingness to crack down on planning offences. In the recent decision Cowra Shire Council v Fuller  NSWLEC 13, in which Bradley Allen Love Lawyers acted for Cowra Shire Council, the Court imposed a penalty of $175,000 on the Defendant for carrying out unlawful development and demolition of a heritage homestead. This is understood to be the highest penalty given to an individual for the offence of carrying out development without consent.
The offence involved the deliberate and wilful demolition of Shiel Homestead, a building with heritage value, in the Cowra Local Government Area. The homestead was demolished on the Easter weekend in 2012, immediately prior to the Council considering a proposal to include the homestead as a heritage item in its local environmental plan. In considering what an appropriate penalty would be, the Court noted the importance of maintaining the integrity of the planning system and that the failure to obtain development consent potentially undermines that system. The deliberate and wilful demolition of the building, and the irreversible nature of the offence, led the Court to describe the offence as objectively serious and deserving of a $250,000 penalty, which was then reduced by 30% to $175,000 due to mitigating factors, including an early plea of guilty. The Court also ordered the Defendant to pay the costs incurred by the Council in the proceedings.
While prosecuting someone for carrying out unlawful development can seem daunting, a successful prosecution can have a substantial deterrent effect and sends an important message to the broader community that the law is being fairly and consistently applied. The incoming changes to the EPA Act support local councils in undertaking strategic prosecutions as part of the tools available to councils to achieve the orderly and economic use and development of land.Read more
The NSW Parliament has recently passed amendments to the Environmental Planning and Assessment Act 1979 (EPA Act)to substantially increase the maximum penalty that can be imposed by the Court when a person commits an offence under the EPA Act. These new provisions have not yet taken effect – they will commence on a day to be appointed by proclamation – but it is only a matter of time.
The Amendment will see the Court switch from its “one size fits all” approach of having one maximum fine for all offences to a tiered offence system similar to that used for offences against the Protection of the Environment Operations Act 1997. Like that Act, three new classes of offences have been created, being:
Tier one offences are the most serious category of offences. An offence is be a Tier One offence if it is deliberate and causes, or is likely to cause, significant harm to the environment or caused the death of, or serious injury or illness to, a person. The maximum penalty for a tier one offence is $5 million for corporations and $1 million for individuals.
Tier two offences are those offences that do not fall within Tier One or Tier Three. The maximum penalty that can be imposed for a Tier Two offence is $2 million for corporations and $500,000 for individuals.
These are the least serious offences and include “certificate-related offences”. A certificate related offence is defined in the EPA Act and is an offence which arises in relation to the issue of a construction, compliance, subdivision or occupation certificate (including the procedures for, and restrictions on, issuing such certificates and the notification requirements of a principal certifying authority). An example of a certificate related offence would be where an occupation certificate is issued and the preconditions to the issue of the certificate that are specified in the development consent, complying development certificate or planning agreement have not been met (s190H EPA Act).The maximum penalty that can be imposed for a Tier Three offence is $1 million for corporations and $250,000 for individuals.
The three tier structure will assist councils to assess the seriousness of an offence upfront and enable strategic decisions to be made about which matters to prosecute.
The Amendment also creates new offences under the EPA Act, including the offence of providing false or misleading information in connection with planning matters. Significantly, the new offence will apply to applicants for an approval, development or certificate and consultants that provide information as part of a development or certificate application, including statements of environmental effects. These changes reflect the important role that consultants play in providing professional and objective information that can be relied on by a consent authority when assessing an application.Read more
Open justice lies at the heart of the Australian court system. The principle has been variously described as ‘immutable’, an ‘essential aspect’ of judicial character and ‘the best security for the pure, impartial and efficient administration of justice’.
Unsurprisingly, the concept has a variety of meanings. At base, it requires that court proceedings and associated documents be physically accessible to the general public. Yet perhaps more importantly, especially as most people rarely, if ever, are inclined to attend court as spectators, open justice entails media access to courtroom hearings so that such reporting can be disseminated to a larger audience.
This principle is not, however, absolute. As with many fundamental legal principles, open justice is often at tension with well-meaning exceptions. Just as the administration of justice normally requires litigation to occur in the open, so may it occasionally necessitate closed hearings in cases of confidential information, child-related matters and where issues of national security arise. While these exceptions are ‘strictly defined’, common law and statute make allowances for private proceedings or the issuance of various orders to a similar effect.
For example, s 37AG of the Federal Court of Australia Act 1976 (Cth) provides several grounds for the Court to make non-publication or suppression orders. While it ‘must take into account that a primary objective of the administration of justice is to safeguard the public interest in open justice’, orders can be made when necessary, among other things, to prevent prejudice to the administration of justice, to protect national security related government interests and to protect the safety of any person. Similar powers exist at common law, and the legislation expressly does not affect those powers.
Although the Federal Court Act provides little guidance as to determining between these various competing principles, case law offers ‘necessity’ as a tool. This test prescribes that a departure from open justice will only be permitted if it is ‘really necessary to secure the proper administration of justice’. In Hogan v Australian Crime Commission, a decision dealing with the previous incarnation of the Federal Court’s suppression powers, the High Court added that it must be more than ‘convenient, reasonable or sensible, or to serve some notion of the public interest’. As the Victorian bench book bluntly puts it, ‘necessity is a high threshold’. Read more.
First published in Ethos, the ACT Law Society’s journal.Read more
The law governing employment contracts has become significantly more black and white in recent months, following the High Court’s pronouncement in Commonwealth Bank of Australia v Barker that the implied term of mutual trust and confidence is, under the common law of Australia, dead
In doing so, the Court conclusively settled “one of the most contentious questions in Australian employment law,” and provided relief for nervous employers already concerned about their employment-related liability following Richardson v Oracle Corporation of Australia. Yet the Court’s reluctance to consider the associated implied term of good faith leaves another area of uncertainty awaiting further litigation.
Barker arose following the Commonwealth Bank’s decision in 2009 to make a senior and long-serving employee redundant as the result of restructuring. While the Bank attempted to find redeployment opportunities for Mr Barker, he had been stripped of access to his work email and so the Bank’s messages about such attempts did not reach him until just prior to the date of termination.
Before Besanko J of the Federal Court, Mr Barker claimed that the Bank “had failed to conduct the termination or redundancy process in a bona fide and/or proper manner.” This failure, he claimed, amounted to a breach of two of the Bank’s policies — its redundancy policy and its equal employment opportunity policy. Mr Barker founded his claim in contract on three alternative propositions — the policies were expressly incorporated into his employment contract; the policies were incorporated by practice and usage into his employment contract; or ‘his contract of employment included an implied term of mutual trust and confidence and that a serious breach of the policies was a breach of that implied term.’
Besanko J was not persuaded by the first two propositions, particularly as the Bank’s employment manual bluntly stated that it was “not in any way incorporated as part of any industrial award or agreement entered into by the Bank, nor does it form any part of an employee’s contract of employment.” However, after considering English cases and judicial recognition of the term in Australia, Besanko J found that “there is an implied term of mutual trust and confidence in the contract of employment between Mr Barker and the Bank.” Read More.
First published in Ethos, the ACT Law Society’s journal.Read more
Bradley Allen Love Lawyers can help protect you and your company by providing a range of policies and policy packages drafted by our team of employment law experts and customised to suit the individual workplace.
Drafting workplace policies can be challenging. They need to comply with a diverse range of legislation, should be directive to employees yet not contractually binding on employers, and may have to withstand judicial scrutiny if relied upon in a workplace dispute.
The cost of poorly worded policies has increased significantly following recent court decisions. In Richardson v Oracle, the employer was found vicariously liable for an employee’s sexual harassment of a colleague. The judge held that Oracle’s policies were not sufficient to provide a ‘reasonable steps’ defence, and awarded damages of $130,000. In another case, an employee subjected to persistent sexual harassment from her manager received $733,723 in compensation.
To assist organisations protect themselves from these risks, Bradley Allen Love has drafted customisable policies aimed at fulfilling legal requirements and explaining the obligations of employers and employees.
Bullying, Harassment & Discrimination Policy ($750 inc GST)
Designed to be compliant with a range of legislation,this policy forms an essential part of a prospective ‘reasonable steps’ defence against vicarious liability for sexual harassment. It explains the legal responsibilities of employees, and outlines what constitutes bullying, sexual harassment and unlawful discrimination. It also includes clauses on complaints procedures, privacy and disciplinary sanctions.
Work Health and Safety Policy ($750 inc GST)
Drafted to meet obligations arising under the Work Health and Safety Act 2011 and Workers Compensation Act 1951, this policy aims to foster a safe workplace and provide protection from liability when incidents occur. It describes the relevant responsibilities, includes work safety concern and inspection templates, and highlights the duty to notify of incidents obligation. It also provides for the creation of a workplace health and safety committee – the most practical way to satisfy the consultation requirement.
Complete Workplace Policies Suite ($2,000 inc GST)
Bradley Allen Love Lawyers can provide an extensive suite of legislatively compliant policies. Aimed at protecting your organisation from a range of potential workplace issues, the suite includes:
To talk about the policies that will best suit your business, or to order a package, please call us on 02 6274 0842.Read more
The ACT recently brought itself into line with most other Australian jurisdictions when the Legislative Assembly enacted legislation giving certain people the right to access a copy of a deceased’s will. As of 17 November 2014, section 126 was inserted into the Administration and Probate Act 1929. It gives an ‘interested person’ the right to inspect, or be provided with, copies of a will, even if the holder only has a copy of the will themselves. A will is defined to include a revoked will, an informal will, or a codicil to any will. The inclusive definition means that the Act does not limit the documents which may be accessed.
Before this law was passed, there was little recourse available to force someone to provide a copy of the will of a deceased person. As a result, in some circumstances it was difficult to hold an executor to account or know whether to challenge the will.
There is a range of reasons why a person might need to look at a will or former will of a deceased person. In a claim for family provision, for instance, one of the factors considered by the court is the testamentary intentions of the deceased person. Examining a former will is one way to shed light on these intentions. It may also be necessary to confirm whether or not the deceased had testamentary capacity at the time they gave instructions for their will. Further, former wills may be evidence of the authenticity of the testator’s signature on their last will.
In practice, firms could previously ask the Supreme Court to permit access to the will once the executor applied for probate. However, this only helped where the executor needs to apply for probate (which is not always necessary) and the costs of accessing the will in this manner were significant.
Under the amended legislation, an ‘interested person’ is defined with reference to nine broad categories and includes:
A person does not necessarily need to be specifically identified in a will. A person will have the right to request a copy of a will if he or she meets the description of a class of people in the will such as ‘brothers and sisters’.
The only formalities contained the new legislation are that the interested person must make the request in writing, and, to the extent that there are any costs associated with furnishing or copying the will, the interested person must personally bear those costs.
The Act places a positive obligation on any person with ‘possession or control’ of a will to grant access to an interested person. The executor, law firms, and other institutions that employ safe custody procedures cannot refuse access to a copy of a will or former will if the person making the request is an interested person.
So, provided a person can demonstrate that they fall into one of the categories of an ‘interested person’, a request made pursuant to section 126 creates an unqualified obligation to provide copies or access. No additional documentation is required, and access is not dependent on obtaining the consent of any client, or executor or administrator of an estate.
This change to the Act is a positive development. The legal right to access a will is a measure which is designed to save time and, consequently, lower costs. It should simplify the process of estate administration and limit associated potential litigation.
If you would like more information, Bradley Allen Love can provide you with advice on your responsibilities as an executor and your rights as a beneficiary.Read more
The High Court has delivered their landmark judgment in Commonwealth Bank of Australia v Barker, definitively rejecting the implication of a mutual trust and confidence term in Australian employment contracts.
In a judgment that will relieve employers and that clarifies a previously unsettled area of law, the Court broke from British legal developments in a decision cautious about the possibility of encroaching on legislative territory.
Mr Barker, a senior and long-serving employee of the Commonwealth Bank, was made redundant in 2009 as the result of restructuring. Although the Bank made attempts to offer Mr Barker redeployment opportunities, he had been stripped of access to his work email and consequently these messages did not reach him until just before the date of termination.
At first instance, Mr Barker alleged, amongst other things, that the Bank ‘had failed to conduct the termination or redundancy process in a bona fide and/or proper manner’, which represented a breach of both the redundancy policy and equal employment opportunity policy. While these policies expressly stated that they did not form part of the employment contract, Mr Barker alleged his contract contained an implied term of mutual trust and confidence, and the Bank’s actions had breached this term.
Drawing on extensive British jurisprudence, both Besanko J of the Federal Court and Jacobson and Lander JJ of the Full Federal Court agreed with Mr Barker. They noted the implied term was necessary to ‘prevent the enjoyment of rights conferred by contract being rendered nugatory, worthless, or seriously undermined’, before quoting another case to the effect that its development ‘can be seen as consistent with the contemporary view of the employment relationship as involving elements of common interest and partnership, rather than of conflict and subordination.’ Mr Barker was awarded damages in the sum of $317,500.
These decisions represented a significant shift in Australian workplace law, potentially finding an implied term of mutual trust and confidence in every employment contract across the country. However, relying on Jessup J’s strong dissenting judgment, the Bank appealed to the High Court.
Across three concurring judgments, the Court upheld the appeal. Having quoted Brennan J’s statement that ‘there must be constraints on the exercise of the power, else the courts would cross “the Rubicon that divides the judicial and the legislative powers”’, the Court found that such an implied term was ‘a matter more appropriate for the legislature than for the courts to determine’.
Mixing historical metaphors, and having witnessed the Full Federal Court march on Rome, the High Court felt compelled to beat a hasty retreat across the Rubicon lest the implied term ‘act as a Trojan horse’ in employment contracts across Australia.
The take-home message for employers, already apprehensive after the recent Richardson decision, is that they can breathe easy – for now. The Court’s principle-based as opposed to factually-driven rationale in Barker was such that distinguishing the judgment in a later case would prove difficult and thus, barring (unlikely) legislative intervention, the implied term of mutual trust and confidence appears to be no more.
However, the Court left open the possible existence of an implied term of good faith in employment contracts, refusing to be drawn into a consideration of the merits of such an argument. Until another matter brings that question squarely before the Court, it seems the familiar “mutual trust and confidence” pleading will simply be replaced by that of the equally vague “good faith”.Read more
At Bradley Allen Love we understand that being the Executor or Administrator of an estate, particularly of a recently deceased loved one, can be both stressful and challenging. To simplify the process as much as possible we’ve developed the following guide, which explains the key terms and outlines several steps that the Executor or Administrator should follow.
Role of the Executor and Administrator
An “Executor” is a person appointed by a will to manage the deceased’s estate and carry out their wishes as set out in the will.
If the deceased left no will, an invalid will, or an incomplete will, an “Administrator” is appointed by the Court to manage the deceased’s estate and distribute according to law.
Although a willmaker can choose whomever they want to be the executor, it is standard practice to appoint someone who is going to be a major beneficiary under the will. If, on the other hand, the Court appoints an administrator, they have complete discretion in selecting their appointee.
Being the Executor or Administrator is a position of trust and responsibility, and comes with duties and obligations that can be quite time-consuming. The Executor or Administrator is entitled to seek legal advice in the course of carrying out their duties, with such advice paid for by the estate. Accordingly, you should not be personally out-of-pocket as a result of being the Executor or Administrator. If you have any concerns about your rights and obligations as an Executor or Administrator, please seek legal advice.
What to do before receiving the Death Certificate
A Death Certificate is typically issued approximately two weeks after the funeral and will be posted to the person who completed the death notification for the funeral director. This period of time can be particularly frustrating for many executors and the family, because little progress can be made while waiting for the Death Certificate. However, the executor or proposed administrator can take some preliminary steps, such as:
You should also consider obtaining legal advice during this time.
How long is this all going to take?
Completing the estate administration is likely to take until the end of the current financial year, though can take until the end of the next financial year in some circumstances. This is because the executor or administrator is obliged to file the deceased’s last tax return covering the period from that financial year until date of death and, possibly, an estate tax return from date of death to the end of the financial year as well.
You can expect to complete the estate administration, with prompt professional advice and assistance, within six to twelve months.
It is entirely possible for it to take longer, but this is usually the result of litigation, delays on the part of banks or other financial institutions, or difficulty selling a property.
Is there anything else I need to know?
There are a few key terms that you may not understand. An explanatory document with definitions of such terms can be found here.
You should also be aware that no estate is the same. Applying for Grants of Probate or Letters of Administration, properly attending to the estate administration and dealing with the tax issues that flow from it, dealing with estate litigation, and dealing with the beneficiaries is a difficult and time-consuming task.
Our point is that you should not take these things lightly, nor should you rely on advice from anyone other than specialist estate lawyers. Our team of expert estate lawyers are able to answer all your estate inquiries.Read more
On 5 June 2014 the ACT Government introduced the Payroll Tax Amendment Bill 2014 that will remove the ‘genuine employer’ payroll tax exemption on wages paid to subcontractors by employment agents and payroll agencies (collectively ‘agencies’). The bill was originally slated to commence on 1 July 2014, however the Commissioner for ACT Revenue acknowledged this date would have been challenging for the industry and the commencement date has been delayed until 1 October 2014.
The genuine employer exemption is currently relied on by a majority of local employment agencies, payroll companies and subcontractors (ICT contractors in particular). Its removal effectively imposes a new tax on an industry locally evolved to meet the Commonwealth’s ad hoc labour needs. Someone in the employment agent/subcontractor chain will end up wearing that 6.85% cost.
That 6.85% cost may well represent a considerable part of an agency’s revenue, threatening its very viability. Without provisions to increase the contracted ‘spend’, this cost will represent a significant loss of income for a subcontractor or risk the agency’s business. Who will bear that cost will depend upon the contractual arrangements in place.
Contracts that have not yet been executed should address the payroll tax cost from 1 October 2014; if agencies are to avoid this imposition, they need the indemnities to be clear. Where contracts had already been negotiated and executed, the question of who will bear the payroll tax cost will turn on the specific terms of those contracts.
Well drafted contracts should have anticipated the possible removal of the exemption and should clearly set out how any increase in tax liability will be assigned. Poorly drafted contracts may be unclear and those uncertainties may result in parties attempting to pass on costs that they are not entitled to pass on, parties refusing liability for costs that they are liable to bear, breaches or terminations of contracts that are no longer profitable and possible insolvencies within the industry.
This issue is further complicated by the $1.85m tax free threshold for payroll tax. Employment agencies do not have to pay the tax on their first $1.85m of payroll in the ACT. If agencies simply withhold a flat 6.85% from all contractors’ wages in order to meet the payroll tax obligations, what happens to that first $126,725.00 they withhold but do not have to pay in tax? Some agencies may pocket the money; others may hold the money on trust for the subcontractors and return it at the end of the financial year on a pro-rata basis.
If you are involved in the industry then it is imperative that you review your contracts to ensure your position is protected.Read more
This month, Bradley Allen Love Lawyers has much to celebrate with staff and clients. The firm has completed renovations of its premises, which now includes the 8th and 9th floors of the iconic Canberra House at the heart of Canberra’s legal and financial precinct. The firm also celebrates the promotion of seven of its lawyers as they take on new responsibilities.
“Bradley Allen Love Lawyers has gone from strength to strength since the merger of well-known firms Williams Love & Nicol Lawyers and Bradley Allen Lawyers in September 2012,” Managing Legal Director, John Wilson said.
Bradley Allen Love Lawyers – A Time to Celebrate “To support the firm’s continued success and growth in operations, we’re pleased to be able to accommodate our eighty staff within one location in the city with some great new facilities for our clients,” he said.
Bradley Allen Love Lawyers’ stylish renovations at 40 Marcus Clarke Street include client seminar room facilities, additional conference rooms, a large project area and a staff breakout area.
“It’s important to acknowledge and celebrate success and we look forward to doing this with our staff, clients and community partners at the renovation opening,” he said.
“The Directors are very proud of the team at Bradley Allen Love Lawyers and that it continues to be a city firm in the heart of Canberra.”
This year’s promotion of seven of the firm’s lawyers is recognition of their hard work and determination to establish their reputations in their chosen field, and acknowledgement of their commitment to client service excellence.
“As a local firm, we invest in our staff and provide them with a rewarding career path so they are proud ambassadors for our firm and an integral part of the Canberra community, whether for work or in their social lives,” John said.
“The Directors congratulate each of the team members on their promotion.”Read more
A statutory demand notice is a formal, attested demand, which if correctly issued and served, gives the debtor company 21 days from the date of service to pay or compromise the debt to the creditor’s satisfaction. If the company fails to do so, then it is presumed to be “insolvent”.
If a debtor company takes issue with the claim in the statutory demand, its form or its service, then the debtor company only has 21 days within which it must file and serve an application before the Court to have the statutory demand set aside; the Court cannot allow more time in which to bring that application and the application must be served with all the evidence on which the debtor company intends to rely.
If the debtor company responds promptly, and has creditable proof that there is a genuine dispute regarding the debt claimed, then it should immediately state that case to the party making the demand, inviting the creditor to withdraw the statutory demand. A “genuine dispute” about the debt is a very low threshold. If the creditor does not heed that, then the creditor risks losing such an application, with a costs order to bear for the creditor’s trouble.
With time being of the essence, the worst thing you can do in relation to a statutory demand is to ignore it.
Where there is proper basis for belief that no genuine dispute exists, a statutory demand puts the creditor in a strong position.
But where the debt claimed was in dispute, then the pendulum of pressure can rapidly and fiercely swing in the opposite direction and can do so at considerable cost. Not only will the costs of preparing the statutory demand be sunk, but also the imprudent creditor claim can be turned into a considerable liability. In short, a statutory demand should not be lightly made, nor lightly taken.
Lesson for the well prepared: Habits are purportedly broken in 21 days – as are debtor companies who fail to respond to statutory demand notices.
First published in B2B Magazine.Read more
Bradley Allen Love are pleased to announce that Alan Bradbury, John Bradley, Mark Love and John Wilson have featured in the 2014 edition of The Best Lawyers in Australia. This is the second year running for John Wilson and the fifth for Alan Bradbury.
Created by peer-review company Best Lawyers and published by the Australian Financial Review, the list of Australia’s best includes lawyers in private practice, chosen through an exhaustive survey where top lawyers evaluate their professional peers. Ultimately a lawyer’s inclusion is based on the subjective judgments of his or her fellow lawyers.
Our experts have been selected across the following specialties:
Bradbury tops the list for Canberra in Planning and Environmental Law
In addition to this, Alan Bradbury has been named the Best Lawyers’ 2014 Planning and Environmental Law “Lawyer of the Year” – recognition only bestowed on those with the highest score of their peer group.
Receiving this designation reflects the high level of respect a lawyer has earned among other leading lawyers in the same communities and the same practise areas for their abilities, their professionalism and their integrity.
The Best Lawyers list has been published for over 30 years, earning the respect of the legal profession, the media, and the public as the most reliable, unbiased source of legal referrals.Read more
Restructuring, redeploying and refocusing business activities often result in positions becoming excess to your organisation’s requirements.
But identifying such positions is just the first step in ensuring compliance with redundancy obligations. All businesses, both large and small, need to be aware of a number of legal issues relevant to terminations and redundancies to reduce the risk of an employment dispute.
Further, if a redundancy is to result in termination, the termination will be outside the unfair dismissal regime of the Fair Work Act 2009, if the redundancy is a “genuine redundancy” as defined under that Act. However, the definition is not as straightforward as one might think.
A “genuine redundancy” requires an employer to be able to demonstrate:
The general position regarding redeployment obligations is that an employer must consider the redeployment of the individual where the employee has the appropriate skills and qualifications to perform the new role, and the redeployment would not have any adverse impact on the operational efficiency of the business.
One area in which employers often fail to satisfy the Fair Work Commission (FWC) that they have taken such reasonable steps to redeploy is where they do not make enquiries to identify available positions:
In the 2012 FWC decision of Aldred, a construction worker was successful in his application for unfair dismissal because his employer:
Getting a redundancy right is no minefield, but do tread carefully. Be fair about identifying who is to be made redundant, treat them in accordance with the obligations in their contract, the Enterprise Agreement or award, and your policies, and make genuine attempts to redeploy them. This will avoid most headaches.
For advice and assistance with consultation requirements and the redundancy process please contact the Bradley Allen Love Employment Law Team on 6274 0999.
 Section 389 of the Fair Work Act 2009 (Cth).
 Robert Aldred v J Hutchinson  FWA 8289.
 Ulan Coal Mines Ltd v Honeysett; Murray v Ulan Coal Mines Ltd  FWAFB 7578 at 35.
It is common practice for a Landlord to request a Tenant to provide security for performance of their commercial lease obligations by way of cash bond or bank guarantee. However, many Landlords accept either form of security without considering the relative advantages and disadvantages of each.
A bank guarantee is an undertaking from a banking institution to guarantee performance of the Tenant’s lease obligations. This form of security allows a Landlord to call upon the guarantee without reference to the Tenant once the bank guarantee is presented by the Landlord to the banking institution.
This form of security is very convenient, as it requires no ongoing obligations from the Landlord such as opening a bank account and having to account to the Tenant for interest accrued.
Another advantage of holding a bank guarantee is that the Landlord does not have to consider recent changes to the Banking Act 1959 which have reduced the timeframe before a bank account is deemed inactive from seven to three years.
The main disadvantage of requesting a bank guarantee is the time it takes to call upon. This is normally due to the Tenant or their banking institution’s own administrative procedures which can take days or weeks to finalise. A further important consideration for Landlords when accepting bank guarantees is to ensure that the document contains all of the necessary and correct information.
A cash bond is monies provided by the Tenant, usually by way of bank cheque, to guarantee performance of the Tenant’s lease obligations.
The main advantage of accepting a cash bond is that it is easy to collect and avoids the Tenant having to deal with a banking institution which can delay security being provided.
The primary disadvantage of accepting a cash bond, where a lease is subject to the Leases (Commercial and Retail) Act 2001 (the ‘Act’), is that under section 42 of the Act the Landlord is required to hold the monies on trust, in a bank account that attracts interest. The obligation to deposit the cash bond is arguably immediate, notwithstanding the possible intention of the parties to replace the cash bond with a bank guarantee at a later date.
Another drawback is that the Landlord needs to be proactive to ensure the cash bond is not declared unclaimed under the Banking Act 1959. If a bank account has had no withdrawals or deposits within a three year period the account will be deemed inactive and the monies will be transferred to ASIC or the Commonwealth. Although the monies are not lost, recovery can involve a lengthy and protracted process.
If you have any questions regarding a Tenant’s security or require any general or specific commercial leasing advice please contact Bradley Allen Love.Read more
A memorandum of understanding (MOU) can be a useful mechanism to facilitate a comforting commitment between two parties to either informally agree, or to agree to negotiate an agreement. While for some this may inspire confidence and assist in speeding up negotiations, for others, in light of the supposedly non-binding legal nature of such agreements, the MOU is nothing more than a benchmark against which future drafting of a formal contract can be measured.
Often MOUs are employed by government agencies in their interdepartmental dealings as, generally, two different arms of the same legal entity are unable to contract. MOUs allow agencies to clarify roles and responsibilities and manage expectations in joint projects.
For the private sector, it may be appropriate for parties to enter into an MOU where a development project is unusually complex and the detail is undetermined. In those circumstances the MOU might, for example, outline the commercial intent of the parties or the framework for the transaction..
In considering the implementation of an MOU during negotiations, parties should address whether they intend the document to impose legally binding obligations. If such an intention is required, an agreement or deed may be better suited to protecting the parties and avoiding duplication of work, otherwise the MOU should specifically state it is non-binding or state which clauses are intended to be binding (confidentiality, exclusive dealings). Common law has tended to construe MOUs as non-binding. Occasionally a presumption of intention will apply if intention is unclear, terms are clear and consideration is present.
If due diligence is being conducted prior to the signing of any contract, an important consideration is confidentiality. Whether non-disclosure assurances are effected as a binding clause in an MOU or choosing to enter into a Non-Disclosure Agreement, the significance of confidentially regardless of the outcome is paramount. If the parties are after a quick turnaround in documents to achieve confidentiality (even if other ‘in principle terms’ have been agreed) a template non-disclosure agreement will probably suffice with the ‘in principle terms’ best left for the formal agreement or deed. There are no ‘template’ MOUs as each deal will be different.
MOUs are absolutely appropriate in some circumstances but they shouldn’t be used as the automatic first step in a new deal.
To consider: Are you better off pausing while the formal, legally binding (and confidential) contract is drafted which has the capability to protect both parties versus the potential uncertainty of whether an MOU is binding? Or will an ‘intentionally ambivalent’ preliminary agreement conveniently provide you with the flexibility to opt-in or opt-out prior to the formalisation of a contract?
First published in B2B Magazine.
 Arthur, John, ‘Contract Law – Avoiding Legal Risk With MOUs & Heads of Agreement’, Professional Development Young Lawyers Lecture Series 2011 (18 October 2011) 2.Read more
Whether you are contemplating a new venture or a shakeup of your existing business, the New Year is a great time to ask – which business structure is right for me?
Every business is different, but they share a raft of common concerns. The three most commonly used vehicles are sole trader, partnership and private company. Each strikes a different balance between risk and reward.
A sole trader gets your business off the ground fast with minimal compliance burdens. Start-up costs are low and any income derived is considered personal income and taxed at the relevant tax rates. If the business tires or grows rapidly, it’s easy to close it or expand into a new structure. The inherent risk is that you are personally liable for all business expenses; your personal assets are exposed to risk.
If going solo isn’t appealing, partnerships are a common alternative, but dangerous. With similar perks to sole traders, a partnership has the added benefit of shared knowledge and resources. New partners can be added as the business grows. Apart from personal liability, the greatest threat to a partnership is infighting between partners. All debts incurred by another partner, even where done without partnership consent, can land in your lap. Should one partner decide to leave, the entire partnership could be dissolved (and your business along with it).
The universally preferred structure is a private company. The biggest advantage is limited liability which quarantines company losses and protects against most personal liability for company debts. Companies can be run by one person or expanded by issuing shares. A company is expensive to establish, maintain and dispose of. It is subject to regulatory and reporting obligations. Directors are burdened with fiduciary duties. A failure to comply with these duties can attract financial and criminal penalties. The single most overlooked problem with a company is getting your money out as a “shareholder”; you’ll need a lawyer and that is best done well before you want to get out.
There are real advantages to choosing the most suitable business structure, and it’s never too late to make a change that could better protect your assets, reduce your costs or expand your business into the future.
What suits one won’t necessarily suit another so always take the time to get proper advice – it could save you considerable time and money.
First published in B2B Magazine.Read more
There has been a shake-up in Canberra’s industrial relations world following the Work Health and Safety Act 2011 (ACT) and the commencement of the ACT Industrial Court on 8 November 2013.
The ACT Government has ramped up work safety measures following evidence of a serious injury rate which is 31% higher than other States and Territories, and 4 workplace fatalities that took place in the construction sector prior to September 2012. A driving factor is the “Getting Home Safely, Inquiry into Compliance with Work Health and Safety Requirements in the ACT’s Construction Industry” report published in November 2012.
The recommendations in the report focused on the construction industry, and have been accepted for implementation by the ACT Government. If they are successful, the way in which all businesses need to approach work safety will be affected.
One of the 28 recommendations was that the ACT Government should appoint an Industrial Magistrate who can develop knowledge and experience of work health and safety matters and the impact of deterrence.
The Industrial Court will, similarly to the Children’s and Coroner’s Courts, operate within the ACT Magistrates Court. Chief Magistrate Lorraine Walker has been appointed as the Industrial Court Magistrate and will to a large extent hear all matters under the following ACT legislation:
The Industrial Court has the jurisdiction of the Magistrates Court to hear criminal proceedings as well as industrial civil claims of up to $250,000.
The Work Health and Safety Act 2011 which commenced in January 2012 has penalties for offences in respect of primary health and safety duties as follows:
Additionally, penalties for discriminatory, coercive or misleading conduct in respect of work health and safety obligations apply. Under these provisions, an individual can also bring an injunction or a claim for compensation and reinstatement.
One of the concerns raised by the Getting Home Safely Report was the low range of penalties being awarded in comparison with other jurisdictions. The report highlighted the range of penalties handed down in Victoria of between $30,000 and $124,000, in comparison to the ACT, where it is not uncommon for similar contraventions to receive penalties in the low tens of thousands.
Because there have not yet been any decisions under the new work safety legislation, it is still not known whether the new Industrial Court will impose the size of penalties seen in Victoria. However, the most recent decision by Chief Magistrate Walker under the former Work Safety Act 2008 indicated that future penalties are likely to be higher. In the case, which involved an explosion of gas cans in a Canberra pizza restaurant, Chief Magistrate Walker penalised each of the two defendants $24,000 (reduced from $30,000 reflecting a guilty plea) and emphasised the deterrent effect of a penalty “where the cost of failing to comply with one’s work safety obligations is greater than the cost of compliance.”
A noticeable change has been the hiring by Work Safe ACT of additional Safety Inspectors. Over the past year there has been a significant increase in the number of site visits and subsequent issuing by them of improvement, prohibition and infringement notices. Importantly, effective from 1 July 2013, Work Safety Inspectors have been able to issue infringement notices, or on the spot fines for contraventions of the work health and safety legislation. Maximum fines are $720 for an individual and $3,600 for a company. While Work Safe ACT is currently targeting construction sites, it is likely that in the future retail and hospitality workplaces will be inspected.
The new measures and penalties might appear to be strict, but they can be made workable by businesses. The Getting Home Safely Report accepts that the legislative framework more than adequately protects employees, and that far from needing more rules and regulations there is a risk of employers placing an emphasis on paperwork at the expense of their safe work practices. To better assist, Work Safe ACT are increasingly developing checklists and codes of practice which outline practical steps employers can take to mitigate risk.
Work safety is about changing the culture in your workplace, ensuring that:
1. employees have an opportunity to bring safety concerns to their employer’s attention in the knowledge that their concerns will be taken seriously and acted upon; and
2. work safe policies including task specific instructions are not just in place but understood, promoted by management and complied with by all employees.
To assist you in developing a compliant and workable safety regime in your workplace please contact the Bradley Allen Love Employment Law team on 02 6274 0999.
 Anthony Noakes v Stephen Fitzsimmons and Jeremy Grobben  ACTMC 8 (1 JULY 2013) at .Read more
The two year transitional period under the Personal Property Securities Act 2009 (Cth) (‘PPSA’) ends on 31 January 2014.
If you have been granted a security interest prior to 30 January 2012, it is time to review your existing security arrangements and confirm the security interest is appropriately recorded on the Personal Property Securities Register (‘PPSR’) before 31 January 2014.
If a security interest is not registered before the 31 January 2014, title to an asset can be lost in the event of insolvency if the insolvent party is in possession or control of the asset. Title can also be lost to a subsequent security interest holder if they register an interest on the PPSR. Registration or perfection of a security interest is essential to protect your interests from such risks.
There are also interests that were not previously regarded as security interests or registrable under legislation prior to the PPSA that are now regarded as security interests and they can and should be registered.
Examples of agreements which may give rise to a security interest under the PPSA include:
While certain security interests granted prior to 30 January 2012 were automatically migrated to the PPSR from various Commonwealth, State and Territory pre-PPSR registers, it is necessary to check if the security interest has been successfully migrated. Issues arose during the migration process which means there is no guarantee that all migrated charges were correctly registered on the PPSR, which presents a risk to security interest holders. Discrepancies in recording company details and serial numbers are just a few examples of how the migration process was flawed.
Details regarding registering and/or searching for a security interest can be found on the PPSR website.
For more information about registering and searching a security interest, or to better understand the possible implications of the PPSA for your business, please contact Bradley Allen Love.Read more
Bradley Allen Love wants to ensure that all its clients enjoy a safe and prosperous New Year. If the people and the assets of a business are its muscles and bones, then information is its life blood. With this in mind, here are some recommendations for keeping your information safe and secure in 2014:
Have a safe, prosperous and secure 2014.Read more
Many businesses invest considerable sums to develop functionality for their computer programs and software. Contracted IT developers are commonly asked develop solutions to reorganise the way in which business information can be stored, accessed and used. The solutions themselves become valuable assets, but controlling rights to the solution is often left overlooked until it is too late.
Paying a consultant to develop software is not like buying an asset. If you are careless, you might have to pay for it to be built, then pay more to use it. User fees might be hidden in “ongoing support and maintenance contracts”. Further, you may be “captive” when you want to re-scale or further enhance the functionality of your “system”.
For consultants and contractors, the author or inventor of the code is the owner of it. You won’t be, unless you can prove otherwise.
Copyright in “literary works” (of which computer programs are one) does not extend to the right to prohibit someone from “using” the work, but it does prohibit reproduction, publication or adaptation. Most computer programs function by reproducing the code (albeit invisibly and electronically) whenever the program runs, and therein lies the problem. For computer programs, the Copyright Act permits that automatic reproduction, where it occurs in the course of running the program, however, first you must show you hold a “licence” for the copy you use (s.47B).
If your contract doesn’t address this issue, then you must prove that your bargain includes an implicit licence or assignment of rights permitting your continued use, else you face the potential to pay licence fees to the author. In most cases you have to find that implication from within the contractual documents you have with your contractor.
Businesses that engage outside consultants to design or develop computer programs must ensure that they either:
• retain ownership of the developed copyright;
• have some sort of “licence” to use, reproduce, modify or adapt the copyrighted work, or
• have an “assignment” to do those acts,
and while “licences to use” don’t have to be in writing, rights to modify or adapt could well require assignments in writing.
“An assignment of copyright (whether total or partial) does not have effect unless it is in writing signed by or on behalf of the assignor” (s.196(3) of the Copyright Act 1968 (Cth)).
Solution – Whatever you expect from your consultants, get it in writing first.
First published in B2B Magazine.Read more
The risks of an improperly or inadequately drafted Will are numerous, with the likelihood of expensive estate administration and the possibility that wishes will not be followed. ‘Newsagent Wills’ are some of the worst offenders in this area, despite their attractive price-tag, because they are often ambiguous and seldom reflect an understanding of the deeper complexity of modern estate planning that goes so much further than just having a Will.
The need to fix problems arising from an improperly drafted Will can give rise to unnecessary costs amounting to tens of thousands of dollars, and can even damage family relationships going forward. This is particularly true if the Will unintentionally divides the estate inequitably between children, giving rise to a dispute.
When an untrained will-maker takes on the task of drafting their own Will without understanding the critical importance of the gift of residue, the central concept of estate and non-estate assets and the role and responsibilities of the executor, the risk that the above issues will become a reality are greatly increased.
Newsagent Wills are relatively inexpensive – often sold as part of a ‘two for one’ deal under $30.00. Nevertheless, many expect such Will packs to be an adequate substitute for legal advice and professional Will drafting, and their use generally comes at the cost of proper estate planning advice.
However, estate planning is not so simple that it may be dealt with satisfactorily by a single, simple document and in the absence of legal advice in respect of your assets, the proper drafting of your Will and the many other aspects of your estate planning.
Newsagent Wills almost always fall short of the sophistication and quality required, as such documents simply cannot provide the necessary guidance or tailoring for the particular circumstances of their users. And ultimately you are paying for a product, rather than legal advice, so you cannot call anyone if queries arise while writing the Will.
Common issues associated with Newsagent Wills are:
Our experience is that Newsagent Wills invariably cost the estate a great deal more to administer. In a 2006 case, the judge made the following comment:
The making of home-made Wills can lead to problems. That statement is not a paid advertisement for the legal profession. It is a statement of fact. This case illustrates the point.
We have had to obtain a Grant of Probate of with an old, handwritten Will that failed to dispose of much of the estate, though what it did dispose of it divided equally between the children.
Unfortunately, times had changed and the will-maker had since re-partnered and remained in that relationship for more than a decade.
When the will-maker died, there were issues about validity, due execution, partial intestacy and a claim under the Family Provision Act 1969 (ACT), in addition to other complicating issues, which costs the estate significantly.
Solicitors turn their mind to many issues when drafting a Will and will often carefully amend the Will to reflect the instructions of the client before them; it is not just a matter of copying from an old Will or a friend’s Will.
We have had to administer estates where people have done just this, but, as a result of misunderstanding the structure of the Will, no executors were appointed, meaning that statutory rules apply.
The failure to appoint executors was not fatal to the Will, but it needlessly incurred further costs.
Take the person who writes out their own Will by hand without the aid of a solicitor and just signs it at home by themselves. They may hide that document away for many years or give it to a family member for safe keeping without a further thought.
Years later, that person passes away. It may be that we have little evidence outside of the document itself that the person intended that document to be their last Will. As result it may be regarded as a mere expression of wishes because it lacked the necessary testamentary intent.
We have acted in one such matter where a note has been left to the effect that a child was to receive a particular property, being the vast majority of the estate. Unfortunately, that document could not be propounded as a Will because it lacked the necessary testamentary intention. The intended beneficiary had to share the property with other siblings.
Our advice is that Newsagent Wills should never be used if you:
The reality is that Newsagents Wills are likely to fall-short in a number of ways, and often through no fault of the will-maker. We would emphasise that the real cost is in fixing the above problems, not in instructing an experienced estate planning solicitor to draft your Will for you.Read more
Bradley Allen Love Lawyers is proud to be supporting Boundless Canberra, as they raise funds to build an all-abilities playground to celebrate the national capital’s centenary.
To be built on the shores of Lake Burley Griffin near the Carillion, the playground will be a free play space with world class facilities, designed to be inclusive for children of all ages and abilities.
“Canberra is a fantastic place to raise children and one of the reasons for that are the many parks and playgrounds throughout our city,” Boundless Canberra Chair Ross Barrett explained. “However, children with disabilities often can’t access these parks and miss out on the fun and learning benefits that are associated with play.”
Bradley Allen Love provided legal services as an auction item for the Charity Ball last month, with all proceeds going to Boundless.
“The Boundless project is a great gift from the people of Canberra to the city, and will provide a space for children from all around the region to enjoy the nation’s capital over the next 100 years.”
Bradley Allen Love Lawyers’ partnership with another centenary project, providing pro bono legal advice to Craft ACT, was recognised in September with the 2013 Creative Partnerships SME Award for New South Wales and the Australian Capital Territory.
Bradley Allen Love is proud to actively support a range of community organisations and endeavours. For more information see our Community page.Read more
Part one of this article looked at the distinction between being found to be ”excess to requirements” under the Public Service Act and the meaning of ”genuine redundancy” or “redundant” under the Fair Work Act. A case recently decided by the Federal Court’s full bench, Weeks v Commissioner of Taxation, shows these distinctions can have very real-world consequences in relation to the taxation of payments made to an employee who has left their employer.
Before looking at the decision in Weeks, it is worthwhile setting out the central provision of the Income Tax Assessment Act, section 83-175(1), which is written in the following terms:
A genuine redundancy payment is so much of a payment received by an employee who is dismissed from employment because the employee’s position is genuinely redundant as exceeds the amount that could reasonably be expected to be received by the employee in consequence of the voluntary termination of his or her employment at the time of the dismissal.
The questions arise: is a termination of employment on the ground of being ”excess to requirements” a ”genuine redundancy” under tax law? Is a ”directed retirement”, as per section 37 of the Public Service Act, a real ”retirement” at all?
Taxation ruling TR 2009/2 is quite detailed but it relevantly provides the following:
The commissioner’s view is that a genuine redundancy payment can only arise where there is no suitable job available for the employee with the employer, meaning that he or she must therefore be dismissed.
… Dismissal is a particular mode of employment termination. It requires a decision to terminate employment at the employer’s initiative without the consent of the employee. This stands in contrast to employment that is terminated at the initiative of the employee, for example in the case of resignation.
… Consent in this context refers to the employee freely choosing to agree to or approve the act or decision to terminate employment in circumstances where the employee has the capacity to make such a choice. Determining whether an employee has consented to their termination requires an assessment of the facts and circumstances of each case. Consent may be either expressly stated by the employee or implied by their behaviour or conduct.
If we turn now to the Weeks decision, the full bench of the Federal Court found no inconsistency between a public sector executive being ”excess to requirements” under the Public Service Act and her position not being genuinely redundant.
A former Australian Taxation Office executive, Cheryl Weeks, failed in her argument that the termination of her employment was a genuine redundancy under tax law.
The full court upheld an earlier ruling that her termination payout did not amount to a genuine redundancy payment under the Income Tax Assessment Act.
The Tax Office terminated Weeks’s employment under s29(3)(a) of the Public Service Act. That is, the reason for her termination was that she was ”excess to requirements”.
In response to a submission by Weeks, her manager had agreed to her termination being treated as a ”voluntary redundancy” under clause 97 of the ATO (Executive Level 2) Agreement 2009.
The full court rejected her argument that the payment be treated in a tax-advantaged manner as a genuine redundancy payment. The court saw no inconsistency between the employee being excess to the requirements of the agency and the employee’s position not being (genuinely) redundant. In the reasons for judgment, the court observed that the ”important question for present purposes is whether she was genuinely redundant”, and went on to note that case law had established that ”redundancy occurs where an employer no longer requires that a job be done by anyone. That situation – where a job effectively disappears – must be distinguished from the situation in which the employer no longer wants a job done by the (former) employee in question.” The court found that, in this case, the job had not disappeared, even if the position number had changed.
Weeks was therefore liable for a substantially increased tax bill.
Thus, you can be excess to requirements, terminated from your employment by way of an offer of redundancy, but not actually have that payment treated under tax law as a genuine redundancy payment.
When one assesses the definitions of ”excess to requirements” and the kind of effort that would need to be put into redeployment before such a determination being made, it seems clear that a properly founded case of ”excess to requirements” would also satisfy the requirements for a ”genuine redundancy” under the Fair Work Act. However, as discussed above, this does not mean payments received as a result of being found excess to requirements will attract the tax benefits applicable to a ”genuine redundancy” under tax law.
All this seems to suggest that, if a public servant is notified that they are ”excess to requirements”, they should first ascertain what steps their employer has taken to find them ”suitable employment” elsewhere within the Australian Public Service. That is, what efforts have been made for their ”redeployment”.
If, on its face, it seems that the agency has made a genuine effort to redeploy them, then the public servant should get a statement from their employer saying that not only are they excess to requirements but their position has been made redundant. Additionally, the public servant should specifically ask their employer if theirs is a case where the employer no longer wants the job done by them specifically or, rather, if it is a case where the job has effectively disappeared.
If the job has effectively disappeared, the public servant should be able to access the tax benefits that are attracted by a ”genuine redundancy payment” under the Income Tax Assessment Act. However, if the employer has decided that they do not wish for the public servant to specifically do the job in question, the public servant should seek answers as to why this may be the case. He or she may find that they have redress because of:
First published in the Canberra Times’ Public Sector Informant.Read more
The Australian Public Service is at the forefront of the new government’s search for savings. The Coalition announced before the election it would significantly reduce the size of the federal bureaucracy. Public servants and their managers will need to be aware of the ways in which these savings can be sought with redundancy.
Section 29(3)(a) of the Public Service Act says an employee can be terminated if they are ”excess to the requirements of the agency”. An agency is either a department, an executive agency or a statutory agency. The act does not provide a definition of ”excess to requirements”, though a brief review of individual agencies’ enterprise agreements shows they define excess to requirements in much the same terms. Broadly, they say:
An employee may be declared excess if:
In relation to SES employees, there is also section 37 of the act:
… an agency head may give a notice in writing to an SES employee in the agency, stating that the employee will become entitled to a payment of a specified amount if the employee retires within a period specified in the notice.
… if the employee retires within the specified period, by notice in writing to the agency head: (a) the employee is entitled to be paid the specified amount; and (b) the employee is taken, for all purposes, to have retired involuntarily from the APS.
The concept of a genuine redundancy is set out in the Fair Work Act. Under section 119, an employee is entitled to redundancy pay if their employment is terminated at the employer’s initiative because the employer no longer needs the employee’s job to be done by anyone, except where this is due to the ordinary and customary turnover of labour. Additionally, section 389(1)(a) tells us that a genuine redundancy exists where:
… the person’s employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise.
Section 389(2)(a) tells us that a person’s dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:
The meaning of section 389(2) was considered by the full bench of Federal Court in Ulan Coal Mines v Honeysett and Ors, where the court essentially found that if, at the time of the dismissal, there was a job to which the employee could be redeployed, whether a person should be redeployed depended on several factors. They include: the nature of any available position; the qualifications needed to perform the job; the employee’s skills, qualifications and experience; the location of the job in relation to the employee’s residence; and the remuneration that is offered.
For public servants, the question of whether other federal government agencies could be considered ”associated entities” for the purposes of the Fair Work Act was considered by the Fair Work Commission in Noronha v Department of Veterans’ Affairs. After some discussion of the meaning of associated entities under section 50AAA of the Corporations Act, the commission found ”that Commonwealth government departments would be considered ‘associated entities’ ” and that ”the dismissal of a Commonwealth government employee in one department may not be a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within another Commonwealth government department”.
It is worth noting that, since about 1999, public servants have not been employed in a particular ”office”. Rather, they are employed at ”a level”, such as APS1 to APS6. That is, subject to the obvious limits in relation to certain employment tasks, each and every public servant at a particular level was seen to be interchangeable with every other public servant employed at the same level in the agency. There have been cases where a person has been moved from a job they enjoy at a certain level to a job they, at the very least, might not enjoy at the same level. This is perfectly legal. They are still being employed at that level regardless of the fact that their day-to-day job tasks and functions may have substantially changed. This, then, suggests it should be easier to redeploy a public servant from a particular level in one branch or agency to another branch or agency at the same level. Coupling this with the discussion in Noronha would suggest that an agency or department would need to go to some lengths to show that any termination of a public service employee was a genuine redundancy.
Whether someone is ”excess to requirements” seems an easier hurdle to jump and will be considered in more detail next month in part two of this article, dealing with the tax consequences of ”voluntary redundancies” and being found to be ”excess to requirements”.
First published in the Canberra Times’ Public Sector Informant.Read more
Australia exists as one of the most regulated economies in the world. As new technology and access to information sweeps through our lives, society’s expectations of what businesses should deliver is constantly rising. That expectation shift means increased risk for businesses, as our society becomes increasingly litigious.
In all skilled trades and professions this increasingly complex world demands that businesses must get specifically skilled teams to do specific jobs. Industry has long dealt with meeting specialist needs by “subcontracting”.
What many often overlook is the risk posed to them by “proportionate liability” and by the further subcontracting of modern day responsibilities to multiple subcontractors down the line. Having multiple contributors to an outcome can leave a gap between the contractual commitment which a “head contractor” makes with its client and the capacity of the head contractor to recover compensation from its subcontractors.
Where multiple subcontractors have failed to take reasonable care or have breached the Australian Consumer Law causing economic loss or damage to the client then each “concurrent wrongdoer” who contributed to that loss will only be found liable for the proportion of the loss that they caused. Therefore, if the head contractor is going to be able to recover 100% of the loss inflicted on the client, then every party who contributed to the loss must be identified and pursued for their share.
First published in B2B Magazine.Read more
In November 2011 the Building Energy Efficiency Disclosure Act 2010 (‘the Act’) came into effect as part of the Australian Government’s initiative toward promoting energy efficient commercial buildings and greener leasing.
The Act requires building owners to produce a Building Energy Efficiency Certificate (BEEC) when offering for sale or lease space over 2,000 square metres which is capable of being used or is used as office space. This will include entering into a new lease with an existing tenant which exceeds the required area.
A BEEC certificate must include:
A BEEC is only valid for 12 months, so it is important a building owner checks whether the building has a current BEEC before they invite offers to buy, let or sublet a building (or part of a building).
Failure to have a BEEC can be extremely costly to a building owner with theAct allowing Courts to imposepenalties of up to $170,000 for a body corporate and up to $59,500 for an individual. Alternatively, infringement notices can be issued by the government with fines of up to $17,000 for a body corporate or $5,950 for an individual.
TheAct will not apply to a building that is less than 2 years old or if it is strata titled. It will also not apply to a lease if the term being offered is for 12 months or less.
If you are contemplating the sale of a building or lease of an area of more than 2,000 square metres then Bradley Allen Love Lawyers can assist with the preparation of contracts to ensure building owners are not in breach of their obligations.
For more information or specific advice regarding the sale or leasing of commercial buildings please contact our specialist Commercial Property Team.Read more
Breaking up by SMS is generally considered a cowardly act. But what people do in their private lives is a far cry from what they do in the public arena of employment – and sacking staff by SMS is really not a smart way to go.
Recent cases of ‘sacking by text’ suggest that employers should think twice before hitting the send button on their mobile phone, yet unfortunately this type of conduct appears to be on the rise.
An employee made a successful general protections claim on the basis of such circumstances.
OC (not her real initials) was employed as a permanent full-time senior member of staff and was soon due to commence maternity leave. There had been no performance issues during OC’s employment, and there were no signs of any down-turn in the business – indeed the company had just hired a new employee.
OC asked for a minor reduction in her hours, particularly on her longest day, because she was getting very tired working on her feet all day.
Shortly after making this request, OC was called into a meeting with her employer and was told she had to become a casual and work significantly less hours per week, because business was bad.
OC immediately disputed the changes, and was told that a letter about her new employment conditions would be waiting at work. When she went to collect it, the manager would not speak to her and a third party (not an employee) had to give OC the envelope. Unsurprisingly, she left work immediately in a state of shock, and two days later was sacked by text message.
OC made a general protections application to the Fair Work Commission, and received a considerable lump sum from her former employer by way of settlement.
In a similar case, the Fair Work Commission (‘FWC’) made a ruling against an employer for firing staff by text, fining the business almost $10,000 after the Commission ruled the sacking by text was harsh, unreasonable and unjust.
The Commission found there were no reasons given in the text, or during the later hearing, that included any allegations of “serious misconduct” justifying an instant dismissal.
The FWC Commissioner even added that the text sacking showed a “lack of courage”.
The message from these cases is that firing staff by SMS message is completely inappropriate, and unlikely to end happily for the boss who decides to take what seems to be, but is not, the easy way out.
Contact our Specialist Employment & Workplace Relations Team for more information.Read more
With many individuals and companies still struggling to understand the implications of the Personal Property Security Register (PPSR), it is crucial that people who have a security interest in property take it seriously or risk losing their security interests.
With the PPSR transitional period set to end on 30 January 2014, those who have been granted a security interest before 30 January 2012 need to ensure those interests are registered on the Personal Property Security Register.
Failure to have a security interest registered on the PPSR will mean that those interests will be unenforceable if a subsequent security interest holder registers an interest on the PPSR. This is particularly relevant for those who are engaged in the business of:
To ensure you are protected it is important you search the Personal Property Security Register.
Although some security interests prior to 30 January 2012 have been migrated onto the Personal Property Security Register (eg. charges registered on the ASIC Register of Company Charges) others may not have. Even where charges have been ‘successfully’ migrated onto the Personal Property Security Register, issues have arisen during the migration process which mean there is no guarantee that all migrated charges are properly registered on the PPSR.
To check a security interest is registered on the PPSR click here.
Before searching the online register you will need to set up an account. Once you have an account and pay a small fee you can search by serial number, individual or by company to locate a security interest.
Failure to search the PPSR register and register missing interests means you risk losing your security interest all together.
For more advice on searching and/or registering a security interests please contact our Commercial Property Team at Bradley Allen Love Lawyers who will be happy to assist.Read more
The Building and Construction Industry (Security for Payments) Act 2009 (“the Act”) aims to expedite the recovery of payments owing to smaller sub-contractors who may otherwise be disadvantaged if they are forced to litigate against larger head-contractors.
The Act achieves this through a mandatory adjudication process. The adjudication process under the Act can be summarised through the following steps:
Any person who carries out construction work under a construction contract (excluding residential works) can make a claim under the Act. The claim must (a) identify the works performed, (b) state the amount claimed, and (c) express that the claim is made pursuant to the Act.
If served with a Payment Claim, the builder will have 10 business days to provide a Payment Schedule. The Payment Schedule must assess what the builder says is owing and, if it is less than what is claimed, it must specify the reasons why.
If the Payment Schedule does not specify all the reasons available to the builder, an Adjudicator can only consider those listed in the Payment Schedule.
If no Payment Schedule is provided, the claimant may bring Court proceedings for judgment, and the builder will be barred from raising a Defence in relation to matters arising under the contract.
If the claimant does not accept the Payment Schedule, they have 10 business days apply for adjudication. If adjudication is applied for, the builder will have only 7 days to respond (or 5 days from when the Adjudicator accepts his/her appointment, whichever is the later).
Given the short time limits, if you anticipate a dispute, document everything.
The adjudicator will make a determination within 10 days of the builder’s Response being received. The determination will specify the adjudicated amount payable (if any) which is binding on the parties. Failure to pay the adjudicated amount within 5 days can lead to the decision being recognised as a judgment debt by the Courts, with enforcement action (including winding-up of your company) to follow.
The adjudicator’s decision is final. The Supreme Court will only hear appeals on errors of law, such as whether the Adjudicator acted outside of his/her jurisdiction. A party cannot appeal where they are simply dissatisfied with the findings of fact by the Adjudicator.
However, the Act does not prevent a party from commencing civil proceedings to recover a payment paid under the Act, if they believe the adjudication decision was made in error.
If you receive a statutory demand, always act immediately. Contact our Litigation and Dispute Resolution team for more information.Read more
There is little scope for error for creditors or company debtors where statutory demands are concerned. The consequences for failure to comply with a demand are harsh. The Courts are bound by a strict legislative framework in relation to the operation of statutory demands and a failure to properly issue a demand can be expensive.
A statutory demand notice is a formal, verified demand issued under section 459E of the Corporations Act 2001 (Cth). It is a very effective instrument for ascertaining whether a company can pay its debts as and when they fall due. If such a demand is correctly issued and served and the debtor company fails to pay the debt within 21 days from the date of service of the demand, or otherwise fails to make arrangements to pay the debt to the creditor’s satisfaction, the company is presumed “insolvent” and the creditor can make an application to wind the company up.
Issuing a statutory demand is one of the quickest and least expensive avenues of recovering money owed to you by corporate debtors. It is also one of the most effective ways of enforcing a judgment of the courts if the judgment debtor is a company.
In what circumstances can you issue a statutory demand? A statutory demand can only be issued to a corporate debtor if:
If a creditor issues a demand that fails to meet these tests, the demand will fail.
The Courts have held that creditors who use statutory demands must ensure the demand is expressed in clear, correct and unambiguous terms. The Corporations Act 2001 (Cth) places strict requirements on the form and wording of the demand and the methods of service.
If the demand is confusing, does not correctly identify the creditor, the debtor or the debt outstanding, the creditor risks having a Court set aside the demand.
If a statutory demand is set aside the creditor will not gain the benefit of presumed insolvency and the creditor is likely to bear liability for the debtor’s costs in that application.
A creditor should consider the following before issuing a statutory demand:
Statutory demands must be served upon the debtor company in accordance with section 109X of the Corporations Act 2001 (Cth). This merely requires delivering it or posting it to the company’s registered address or delivering a copy of the document personally to a director of the company.
These methods of service place a responsibility on directors as well as the true occupiers of the registered office, which typically might be the company’s accountants, financial advisers or lawyers, to take action in response to the statutory demand immediately.
For these reasons, having a domestic residence as a company’s registered office is inadvisable, as absence or failure to deal with mail for periods of weeks is not uncommon.
The worst thing you can do in relation to a statutory demand is to ignore it.
A debtor company has 21 days from the date of service of the demand to either pay the money owed or to make an application to set aside the statutory demand.
This time frame is strictly enforced by the courts.
A creditor is entitled to assume that the debtor company has been served 4 days after the date on which they posted the demand. Debtor companies cannot get an extension of time.
A delay of even one day may mean that the debtor company cannot set aside the demand and then, in response to an application to have the debtor company wound up, the company must bring sufficient evidence before a Court to prove that the company is in fact solvent – the issue before the Court is no longer the debt on which the demand was issued, but the solvency of the company.
Time, then, is of the essence. In Challenge Home Loans v Etienne Lawyers  NSWSC 1145 there was a factual dispute as to the day on which the demand was served. The Court held that the demand had actually been served one day prior to the day the debtor company had thought and as such their application to set aside the demand failed.
If the demand is disputed, a debtor company can attempt to negotiate with the creditor to unconditionally withdraw the demand but the debtor company should also instruct solicitors and prepare both the application to set aside the demand and the affidavit material to dispute the debt in the event negotiations fail; those materials must be filed and served within the 21 day period.
To be clear, we repeat: an application to set aside the demand including the affidavit material to be relied upon must be filed and served upon the creditor within the 21 day period.
If a debtor company fails to comply with a statutory demand or have the demand set aside, a presumption can be made that the debtor company is insolvent (s 459C(2)). A creditor can then use this presumption of insolvency to apply to the Court to have the debtor company wound up.
If you receive a statutory demand, always act immediately. Contact our Litigation and Dispute Resolution team for more information.Read more
It is a time honoured scam – send someone unsolicited goods and then demand payment, yet unsurprisingly it’s also against the law. Recipients of such goods or unsolicited services are protected by consumer law and any assertion of a right to payment can lead to pecuniary penalties.
Under section 40 of the Australian Customer Law (‘ACL’), a person involved in trade or commerce is prohibited from claiming a right to payment from the receiver of unsolicited goods or services, unless there is a reasonable cause to believe a right to payment exists.
Similarly, the ACL prevents the sending of an invoice for unsolicited goods or services unless it contains a regulation-compliant warning statement.
The good news for a recipient of unsolicited goods or services is that the law is clearly on their side. However, it would still be prudent to take further steps as outlined in the ACL. The recipient should give the sender of the unsolicited goods a written notice stating their:
Having sent such a letter, the recipient can be safe in the knowledge that the sender of unsolicited goods loses the right to recover the goods one month after the notice was given. Alternatively, even if no notice is sent, the sender loses any recovery rights three months after the goods were received.
As Halsbury’s states, ‘thereupon they become the property of the recipient. The recipient is not liable to make any payment for the goods, and is not liable for their loss or damage during that period, except in the case of a wilful and unlawful act.’
It is therefore clear that the ACL provides protection for businesses and individuals who receive unsolicited goods or services. Although it may be prudent to send a return letter informing the sender of the address for collection, demands for payment are unlawful and the goods become property of the recipient three months later.
If you have received unsolicited goods or services and a corresponding demand for payment, do not hesitate to contact Mark Love, Director of Business and Corporate Law at Bradley Allen Love Lawyers or the Australian Competition and Consumer Commission.Read more
Bruce Malcolm Reid is a doctor contracted to the Essendon Football Club as the “Club Doctor”. He is bringing a case against the Australian Football League to require it to have an independent party hear allegations against him that assert he breached the Australian Football League Rules.
In his writ filed before the Supreme Court of Victoria, Dr Reid’s counsel say that charges were laid against Dr Reid by the Australian Football League: namely for engaging in “conduct unbecoming or likely to prejudice the interests or reputation of the Australian Football League or bring the game of football into disrepute”. The Essendon and others associated with the circumstances leading to the charges laid against Dr Reid have resolved matters with certain agreed admissions being acknowledged, fines, bans and a range of penalties.
The issue for your organisation is “Can I keep my disciplinary processes out of the Court?”
The short answer to that is “No”, as the Court bows to no-one (allowing the full appellate process to be followed). But following the Dr Reid Saga will be educational for many, as it moves to a hearing in two weeks’ time. The real issue here is what issues of bias arise when you apprehend a code breach, assess and, investigate conduct, decide that a contravention may have occurred, and then preside over determining what penalty should apply.
In the course of our work we assist our clients with a range of code compliance issues, whether that is in the course of personal behaviour, employment, advertising in breach of codes, industry rules in the course of conduct, marketing safety or other compliance, as well as professional and educational accreditation standards compliance. These matters have much in common with Dr Reid’s case (‘the Dr Reid Saga’). Much is also is about sustaining industry self-regulation by ensuring the process has integrity, and that the reputation of the assessing body remain intact.
As you would imagine, Counsel for the Australian Football League delivered Dr Reid a well-crafted and lengthy statement of grounds, articulating the basis on which the AFL apprehended Dr Reid had engaged in “conduct unbecoming or likely to prejudice the interests or reputation of the Australian Football League or bring the game of football into disrepute”. That ticks part of the first fundamental box in applying “natural justice”:
These actions go towards that part of natural justice which requires that people are entitled to know the case against them. The second part of that requirement is that people need to be given an opportunity to respond to the case against them – a fair hearing so to speak.
In the Dr Reid Saga, Dr Reid appears to be objecting to the fact that the Australian Football League is apparently ruling on its own investigation. These concerns arise from the perception of bias – can one party fairly be judge, jury, and executioner?
Is that somehow wrong?
Now those of us minded to look to notions of “Separation of Powers” and “Westminster Justice” can be inclined to burr up at such a French concept as a formal hearing being part of the investigative process: how can an investigation lead to a ‘determination’ at the conclusion of that investigation with no independent judge? But such structures are not only common, but typical and intended, and in the realm of bodies who seek to regulate their own affairs, highly desirable.
So, how do you achieve such an outcome? Any regulating body whose actions stand to unfavourably affect the rights and interests of an organisation or a person, should expect the scrutiny of the Courts in dispensing their “justice”.
But the role for society’s ultimate scrutineer (the courts) can be mitigated, reducing that to considerations of whether the rules were properly applied and cases of actual bias, oppression, fraud and other like malfeasance. But this reduction can only through clear drafting of the rules of engagement in the disciplinary processes.
Getting the rules “right” is particularly important for those bodies who administer industry regulatory schemes and professional or educational accreditation processes – particularly where an aspect of public policy is being fulfilled.
Where a member of your organisation or a member of the public has a legitimate expectation that the rules of natural justice and fairness will apply, then a range of (judicial)rules (‘the Rules’) regulating behaviour, will, in all likelihood, apply to the inquisitorial and decision-making processes at all stages of the decision making path. These rules can apply to all sorts of processes and decisions from admission to membership through to expulsion and everything in between.
The Rules are about openness, fairness, participation, accountability, consistency, rationality, legality, and impartiality.
The Rules, in addition to requiring that persons be afforded natural justice (otherwise known as procedural fairness) in relation to decisions that adversely impact on their rights provide that a person aggrieved by a decision may apply to the Court for an order of review in relation to the decision on any one or more of the following grounds:
The reference to an improper exercise of a power includes a reference to taking an irrelevant consideration into account in the exercise of a power; failing to take a relevant consideration into account in the exercise of a power; an exercise of a power for a purpose other than a purpose for which the power is given or in bad faith; an exercise of a personal discretionary power at the direction or behest of another person; an exercise of a discretionary power in accordance with a rule or policy without regard to the merits of the particular case; an exercise of a power that is so unreasonable that no reasonable person could have so exercised the power or in such a way that the result of the exercise of the power is uncertain; and any other exercise of a power in a way that is abuse of the power.
If the rules of engagement in the decision-making or disciplinary process do not clearly exclude these rules or principles, then the Rules clearly delineate how those processes are intended to work – and you may become exposed to vagaries of competing case law.
Our strong recommendation is that if the rules surrounding your business’ processes and decisions are likely to be subject to challenge, you should delineate in clear terms how they will apply – control them, so that the disgruntled accused does not derail your processes.
It the person or body undertaking an investigation is the same person or body making the finding, then spell it out, as was the case with the case of Cynthia Weinstein v Medical Practitioners Board Of Victoria  VSCA 193. If the body hearing the matter is entitled to make its own inquiry, then specifically ensure that you make allowance for that in the rules. If rules of evidence and burdens of proof are not to apply, then say so.
Regulatory committees are rarely intended to operate “judicially”, by which I mean to assess the competing adversarial submissions of the advocates before it, not looking beyond the submissions made, being bound by rules of proof. If your committee is not intended to be that way, then, once again, you need to say it.
If your rules are clear about how the process will apply, then you have the best chance of fending off the challenges that are entirely process-based; the question of “bias” must then devolve to whether the decision-making panel had acted in such a way that
a fair-minded lay observer with knowledge of the material objective facts might entertain a reasonable apprehension that [the tribunal] might not bring an impartial and unprejudiced mind to the resolution of the question in issue
and that, would be left as a question of fact, not a question of process and then the decision ought to be upheld, if fair weight is given to all the material before the decision makers.
Apart from the matters referred to above, core considerations in the application of “natural justice” include:
And whilst Dr Reid may resort to the Magna Carta that No freeman shall be taken or imprisoned ruined or disseised or outlawed or exiled or in any way ruined, nor will we go or send against him, except by the lawful judgement of his peers or by the law of the land.
He might find he has submitted to a system and process that adequately provides for him, to be exhausted before the law will interfere with what he has agreed.
By Mark Love, Legal Director and Accredited Specialist in Business Law.
 And the circumstances are such that the rules of natural justice can be excluded at all.
 Webb v R (1994) 181 CLR 41 at 67 (Deane J)
 Noting that integrity of the decision making process suggests that giving reasons is prudent in many circumstances
 J C Holt, Magna Carta (2nd Ed, Cambridge University Press, 1992) at 461
“Happy Cabby”, a NSW transport company, is very unhappy after it was slapped with a record-breaking fine for sham contracting.
In Fair Work Ombudsman v Happy Cabby Pty Ltd & Anor  FCCA 397 (26 July 2013) Happy Cabby was fined $286,704.00 for sham contracting in one of the fair work regulator’s harshest crackdowns in its ongoing crusade against businesses which are misclassifying employees (in this case shuttle bus drivers) as independent contractors.
The transport company was fined $238,920, and its sole director and owner was fined $47,784.00 for underpaying the transport drivers and average of $3,700 per worker.
One factor in the decision was the vulnerable nature of Happy Cabby’s workforce which generally consists of mature workers, who at the beginning of the relevant period, were aged between 50 and 71 years of age.
The age of the drivers meant that it may have been more difficult for them to find alternative work, especially in a regional centre such as Newcastle. It also meant that they were to some extent held captive by Happy Cabby.
Another factor in the high fine was Happy Cabby’s blatant disregard for earlier cautions in relation to similar conduct which had been given to it by the Fair Work Ombudsman (FWO) in January 2011.
Despite the warning the business kept underpaying the workers and misrepresenting to them that they were contractors.
In addition, prior to Happy Cabby going to the Federal Court, the classification of the workers as employees had also been confirmed by the Australian Taxation Office and by a decision of the Administrative Appeals Tribunal.
The judge, coincidentally Judge Driver (no relation!) determined that the high penalties were appropriate because of a history of prior similar conduct and because, in this case, the director and the company had been “put on notice” of their misdeeds on multiple occasions.
“The Company and Mr Paff could have been in little doubt of the true legal position following the AAT proceedings, and any lingering doubt should have been removed by the Letter of Caution. Their refusal thereafter to change their position was deliberate, based on wilful blindness,” Driver said.
The court ordered individual penalties against Mr Paff for all of the transport company’s contraventions (under the accessorial liability provision: section 550(1) of the Fair Work Act 2009 (Cth) (‘the FW Act’) saying:
Mr Paff is the sole director and company secretary of the Company and served as the Company’s controlling hand and mind. Mr Paff was responsible for all operating decisions and has been extensively involved in the events leading to the contraventions….
Other business personnel who are potentially liability under section 550 (1) of the FW Act include HR managers and other company officers including directors.
Happy Cabby was also found to have breached the statutory record-keeping and pay slip requirements which lead to additional concerns about worker safety.
As Judge Driver said “There is a well-established link between fatigue and poor road safety; as a result, there is significant public interest in keeping track of the hours worked by drivers of transport and public vehicles to ensure that the drivers do not undertake excessive shift lengths and are granted appropriate breaks to ensure they are alert and responsive when in the road”.
Natalie James, the Fair Work Ombudsman, in acknowledging that the case highlighted the serious nature of sham contracting, .said “In cases where we suspect sham contracting is occurring, we look behind the often carefully drafted legal documents to determine what the correct classification for workers is under workplace laws….a business operator cannot automatically convert an employee who is clearly not operating their own business into an independent contractor simply by directing the worker to obtain an Australian Business Number.”
Happy Cabby shows that employers cannot escape prosecution and hefty penalties simply by shopping around for and relying upon, legal advice that conforms to their desired view of the nature of the engagement.
“Sham contracting” essentially means misrepresenting as “contractors”, workers who are in fact “employees”. It is against the law: section 357(1) of the FW Act.
Section 357(1) provides that a person that employs, or proposes to employ, an individual must not represent to the individual that the contract of employment under which the individual is, or would be, employed is a contract for services under which the individual performs, or would perform, work as an independent contractor.
Happy Cabby, in breach of s 357(1), told its employees they were independent contractors by:
The Court decided that the doing of those things did not serve to miraculously transform the employees into contractors. Sham contracting is a serious matter because it can lead and does lead to workers being denied their rightful workplace rights and entitlements.
As has often been observed if it looks like a duck, walks like a duck and quacks like a duck regardless of what you call it, it is in all likelihood a duck.
Contact our Specialist Employment & Workplace Relations Team for more information.Read more
Craft ACT and Bradley Allen Love Lawyers have won the 2013 Creative Partnerships SME Award for New South Wales and the Australian Capital Territory. The award recognises innovative partnerships between the arts, businesses and donors, with state-level winners representing their region at the national awards in November.
Bradley Allen Love has supported Craft ACT with a range of pro bono legal services in relation to the Centenary of Canberra celebrations, advising on a variety of contracts and tender submissions, while the local organisation has reciprocated with promotional support.
The partnership between Bradley Allen Love Lawyers and Craft ACT was born out of a shared passion for the arts and the alignment of key principles and objectives of both organisations to support the arts, enrich the local community and strengthen relationships into the future.
Craft ACT and Bradley Allen Love will represent the ACT/NSW region at the 2013 Creative Partnerships Australia national awards, which will be held in Canberra on November 18.
CEO of Creative Partnerships Australia, Fiona Menzies, was delighted with the quality of nominations.
We’ve been very impressed with the high standard of entries and the range of initiatives nominated this year. The Awards continue to demonstrate that innovative and creative partnerships between the cultural and private sectors are thriving across the country, reaffirming the value these partnerships bring to the organisations and the broader community.
Bradley Allen Love is proud to actively support a range of community organisations and endeavours. For more information see our community page.Read more
Unlike golf, the employment relationship is not a game or a sport – but like golf, the employment relationship is fraught with hazards which need to be effectively negotiated, and which have a number of “additional rules of play” to remain fair.
In the employment relationship, one of the primary hazards occurs when employers and employees are contemplating bringing the employment relationship to an end.
Ending an employment relationship (or indeed ending any relationship) can, just like negotiating any trap in golf, be very problematic.
If an employer wants to bring an employment relationship to an end with minimum financial loss and damage to workplace morale, they need to play fair with the employee at risk of losing their employment.
What does playing fair in the employment arena look like? Certainly not like clubbing the hapless employee with a three-iron.
In Australia, the rules of the employment end-game for small business are found in a legislative instrument called the Small Business Fair Dismissal Code (the Code).
The Code provides that small business employers (that is any business with fewer than 15 employees) may fairly dismiss an employee without notice or warning (that is, summarily dismiss an employee) when the employer has reasonable grounds to believe that the employee was guilty of serious misconduct.
Serious misconduct is defined in the Fair Work Regulations 2009 (Cth) at Regulation 1.07. It includes both (a) wilful or deliberate behaviour by an employee that is inconsistent with the continuation of the contract of employment; and (b) conduct that causes serious and imminent risk to: (i) the health or safety of a person; or (ii) the reputation, viability or profitability of the employer’s business.
Serious misconduct includes the employee, in the course of the employee’s employment, engaging in theft, fraud, or assault, being intoxicated at work, refusing to carry out a lawful and reasonable instruction that is consistent with the employee’s contract of employment.
However, such behaviour does not count for summary dismissal purposes if the employee is able to show that, in the circumstances, the conduct engaged in was not conduct that made employment during the period of notice, unreasonable.
Note that an employee is taken to be intoxicated if the employee’s faculties are, by reason of the employee being under the influence of intoxicating liquor or a drug (except a drug administered by, or taken in accordance with the directions of, a person lawfully authorised to administer the drug), so impaired that the employee is unfit to be entrusted with the employee’s duties or with any duty that the employee may be called upon to perform.
Where an employee is not summarily dismissed because of serious misconduct, a small business employer must give the employee a valid reason, based on their capacity to do the job, or their performance or conduct on the job, if they are at risk of being dismissed.
The employee must be warned verbally (or preferably in writing), that they risk being dismissed if there is no improvement in their work performance or behaviour.
In addition, the employer must give the employee an opportunity to respond to the warning and a reasonable chance to rectify the problem, having regard to the employee’s response.
Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer’s job expectations.
Where an employee is at risk of being dismissed, the employee can have another person present to assist them in discussions. However, the other person cannot be a lawyer acting in a professional capacity.
If an employee is dismissed, the employee may (with certain exceptions) make an unfair dismissal application to the Fair Work Commission.
Should this happen the small business employer will be required to provide evidence to the Commission that they have complied with the Code.
This evidence may include proof that a warning has been given (except in cases of summary dismissal) to the employee, a completed Code checklist, copies of written warning(s), a statement of termination, and signed witness statements.
So long as the employer has properly followed the Code, the dismissal will be deemed fair.
Employees who have been dismissed because of a business downturn or because their job is no longer needed cannot make an unfair dismissal application. However, such a “redundancy” needs to be genuine – not just a strategy the employer is using to remove the employee in question.
If an employer wishes to fairly end the employment relationship because of an employees’ unsatisfactory conduct, performance or capacity to do the job, they should consider taking the following six steps:
The 3 Tees and the 3 Rs
If you play fair, chances are you’re more likely to escape the hazards and pitfalls of the employment relationship, and hit a hole in one – that is, to either safely lose a problem employee or, better still, turn a problem employee into a success story and an asset to your business. Remember it is more cost-effective to retain and retrain existing workers than to recruit new ones.
Contact our Specialist Employment & Workplace Relations Team for more information.Read more
In September 2012, two of Canberra’s prominent law firms, Bradley Allen Lawyers and Williams Love & Nicol, merged to form a practice focused on commercial law. Bradley Allen Love Lawyers now has a comprehensive suite of specialist lawyers in the fields of employment and industrial law, business law, commercial property, planning law, local government, environmental law, administrative law, estate planning and litigation. The firm takes pride in its talented and innovative lawyers who are capable working as an extension of their clients’ businesses, to go beyond the traditional legal role of reactive adviser. The firm currently operates in two separate locations whilst it searches for new premises to accommodate not only their expanded workforce, but also their ever-growing collection of contemporary art. Clients visiting the law firm’s premises in Canberra House are welcomed into the attractive foyer decorated with original paintings, prints and handcrafted furniture, many of which are created by local and emerging artists. This prominent display is symbolic of the engagement and support of the Canberra community espoused by Bradley Allen Love Lawyers.
Keith Bradley AM, Director of Estate Planning, explained that the collection of art started many years ago with Bill McCarthy, Special Counsel in Litigation and Personal Injury. Bill is well-known to artists and arts organizations in Canberra through his pro-bono work and appointments to the Board of many local arts organisations, including ANCA, Canberra Youth Music, Megalo and past organisations of Studio One and MUSE. He also assists local artists in his capacity as pro bono lawyer for the Arts Law Centre of Australia. Through this community interaction Bill has gained considerable insight into how arts organizations and artists operate, what their legal and financial requirements are and how to ensure responsible management without stifling creativity. Bill is highly sympathetic to the financial constraints imposed on many artists and willingly delivers sage advice. In return, Bill is constantly attuned to the local art scene and over the years has used his eye for art to collect pieces he loves to have around him in the office, “According to current psychological profiling, artists tend to be imaginative, emotionally sensitive, open to new ideas and experiences, unconventional and perceptive. We know that support for the arts in its varied forms – authors, visual and performing artists and craftspeople – that their primary purpose in life is the creation of art; that is, passion, rather than money, drives most artists”.
Bill’s enthusiasm encouraged Keith to begin acquiring contemporary art. Together they have built an impressive collection by both established and emerging art and craft practitioners that now adorn the walls of Bradley Allen Love Lawyers, from well-known names like John Coburn, Phillip Wolfhagen and David Rankin, to up-and coming artists such as Carol Sullivan and Geoff Farquhar-Still. Keith is quick to point out that they do not collect for investment purposes – they buy purely in response to a real connection with the work itself. Bill agrees, “Art should not be seen as an investment, rather it adds a certain intangible aura to our lives. Any rise in value should be seen as a bonus.”
As testament to this Keith and Bill both support the annual ANU School of Art Graduate Exhibition by regularly attending the Patrons Preview to purchase work by graduating students. Keith is particularly interested in photography and owns several early works from the ‘Vanity Feminine’ series by Majella Brown, and the apt “Two High Shelving” by Madeleine Donovan hangs above his desk.
Another work that Keith loves to look at each day are two small dioramas discretely nestled on his bookshelf amongst the law tomes. The first diorama has a tiny superman emerging from a red phone box in the middle of a tropical beach; whilst the other scene involves sunbathers, windsurfers and palms trees swaying in the breeze. Keith is amused by the whimsical actions at play within these tiny works of art, allowing his mind to relax and perhaps find creative solutions for the work-related legal problems at hand.
Their eclectic collection inspires not only clients but also staff, who are able to choose pieces to adorn their walls or alternatively to bring in their own artworks for their office. Providing an aesthetically pleasing and intellectually engaging environment for over 80 staff enables a relaxed, creative and productive workplace because, as Keith points out, directors and staff often spend more time in the office than they do in their own homes. Keith believes that the warmth and humanity emanating from original works of art is reflected in the aspirations of the firm.
Bradley Allen Love would like to further their relationships with Canberra artists in the future through targeted events that provide artists with pro bono legal advice on important issues that are often overlooked, such as making a will, consignment contracts, small business issues and intellectual property advice.
Bradley Allen Love Lawyers are already strong supporters of the Canberra community – as Official Legal Services Provider and Sponsor of the Brumbies; as a supporter of Clubs ACT; by running a Small Business Legal Advice Clinic in conjunction with the University of Canberra and through the support of many other organisations such as SIDS, Movember and ACT Diabetes to name a few. Through their involvement with the ANU School of Art and their ongoing relationship with Craft ACT, Bradley Allen Love Lawyers will continue to express their passion for the arts not only through philanthropy and art collection, but by providing the artistic community with much-needed strong, sound legal advice.
Julie Ryder is a freelance textile artist and designer based in Canberra.
Often the operational requirements of a business including the size of a business and the uncertainty of future income necessitate the hiring of casual employees. The benefit of having a casual workforce is fundamentally the flexibility of being able to hire an employee for as long or for as short a period as there is work available. However in some circumstances, casual employees may find themselves working the same hours week to week over an extended period of time, maybe even years. This means that a casual employee may appear to be a committed, long term employee more akin to a permanent employee than a casual.
A recent decision made by the Full Bench of the Fair Work Commission has determined that a casual who works regular and systematic hours will still be classified and treated as a casual employee so long as that employee is engaged as a casual pursuant to the terms of a Modern Award or Enterprise Agreement that covers them. The test will hold true regardless of whether the employee would be assessed as a casual under the general common law meaning of the word or not.
The consequences of failing to identify the classification of an employee as either a permanent or casual employee can have significant consequences. The most important factor is whether an employee is entitled to the casual loading of 25% or whether an employee is entitled to the benefits of permanent employment such as annual leave, personal/carer’s leave, notice of termination and redundancy benefits. A decision that an employee has been incorrectly assessed by an employer as a casual could involve payment to the employee of penalties and back pay of annual and other personal/sick leave entitlements.
The general common law position is that a feature of casual employment is its temporary or irregular nature, “the employee is not obliged to accept an offer to work a particular shift; [and]the employee’s employment technically commences at the beginning of a particular shift and ceases at the end of that shift. In effect, the casual employee is paid the 25% loading to compensate them for the intermittent nature of their employment.
The Telum Decision handed down on 22 April 2012 sets out the circumstances in which a casual employee who works:
will nevertheless still be classified as a casual employee for the purposes of the National Employment Standards.
In order to satisfy the test set out in the decision, an employer must engage the casual employee in accordance with the relevant provisions of a Modern Award or Enterprise Agreement that covers the employee. The arrangement of casual employment can vary between Modern Awards but generally require an employer to:
It is essential for employers to be certain of whether a Modern Award, if any covers their employees. Not only do Modern Awards provide for minimum rates of pay but a Modern Awards may also have specific provisions regarding casual employees that an employer must comply with. For example, a Modern Award may set a maximum number of hours that a casual employee can be rostered to work in a week, or require an employer to offer the casual permanent employment after six months.
The Telum Decision goes some way to bringing certainty to those employers and employees who are covered by a Modern Award or Enterprise Agreement. For those employees however, who are not covered by an Award or Enterprise Agreement, the case emphasizes the importance for employers to be mindful of casual employees who might be considered to be permanent employees because of the regular nature of their work.
Contact our Specialist Employment & Workplace Relations Team for more information.
 Public Service Association and Professional Officers’ Association Amalgamated Union of New South Wales v Department of Justice and Attorney General (Corrective Services NSW)  NSWIRComm 148 at .
 Telum Civil (Qld) Pty Limited v Construction, Forestry, Mining and Energy Union  FWCFB 2434 (the Telum Decision)
There are approximately 600,000 not-for-profit organisations in Australia. A not-for-profit organisation is one which does not operate for the profit, personal gain or other benefit of particular people such as its members or those who run the organisation. Not for profits(‘NFP’) can make a profit, but that profit must be applied for the organisations purpose – i.e. the furtherance of the objects of the organisation without any portion being distributed directly or indirectly to members of the organisation except as bona fide compensation for services rendered or expenses incurred on behalf of the organisation. A need has been identified for regulators to watch over the process.
On 3 December 2013 the new national regulators, the Australian Charities and Not-for-profits Commission (‘ACNC’) commenced operations. As the NFP sector receives a range of funding, including donations from members of the public and tax concessions, grants and other support from Australian Governments, it was considered important to have a national regulatory system that promotes good governance, accountability and transparency for NFP entities so as to maintain, protect and enhance public trust and confidence in the NFP sector.
At present the ACNC will only focus on charities and therefore there are no implications for clubs at the current time.
The ACNC is responsible for ensuring all charities comply with their obligations under the ACNC Act including enforcing governance and external conduct standards.
The new regulators are responsible for determining charity status for all federal tax purposes.
The ATO will however continue to be responsible for administering tax concessions relevant to charities, including income tax exemptions; FBT rebate or exemptions; GST charity concessions and deductible gift recipient (DGR) status.
Registration with the ACNC is voluntary but is now a prerequisite for charities to access charity tax concessions. Registration may also be a prerequisite for other exemptions, benefits and concessions.
You will not need to re-register your organisation if it was endorsed by the ATO as a charity to access tax concessions immediately before 3 December 2012 as your organisation will have automatically been registered with the ACNC. Religious organisations which previously self-assessed as ‘religious institutions’ for tax exemption purposes are not automatically registered with the ACNC.
The services offered by the ACNC includes charity registration, a searchable charity register listing registered Australian charities, education and guidance materials to help charities understand and meet their obligations.
The Register will be maintained electronically and includes specified information about each registered and each formerly registered organisation. The purpose of the register is to provide a single source of easily accessible public information on the NFP sector covered by the ACNC Act.
The Register builds on information that is currently permitted to be included on the register and includes the requirement to include information such as countries (other than Australia) in which the registered entity operates and other names by which the registered entity may be publicly known.
Once registered, an organisation will be required to keep written financial records explaining its transactions, financial position and performance. The records must enable true and fair financial statements to be prepared and to be audited. Records must also be kept that correctly record operations and enable assessment activity by the ACNC to be carried out, which assessment will include entitlement to registration as a type of entity, compliance with the ACNC Act and assessment by the ATO for compliance with taxation laws. These records must be maintained for 7 years.
Each registered organisation must provide the ACNC with an annual information statement. Medium and large organisations must also provide a financial report for the financial year together with any auditor’s report or reviewer’s report required under the ACNC Act. Exemptions for annual financial reports apply for ‘basic religious charities’ (as defined); however, these organisations must submit annual information statements.
Access to the registered entity’s annual report for a financial year must be included on the register where it is voluntarily disclosed for the purpose of being included on the register.
Electronic links to an organisations website will be included where the organisation has voluntarily disclosed this to the ACNC for this purpose.
Registered organisations must notify the ACNC, in the approved form, of changes such as changes to an organisations name, address for service, ceasing to be a responsible or registered entity, changes to governing rules and contraventions of the ACNC Act, non-compliance with a governance standards or external conduct standards if these are significant.
On obligation that is imposed by the ACNC Act on an unincorporated association or body of persons is imposed on each individual who was a director of the association or body at the time the obligation arose, but may be discharged by any such individual.
Offences against the ACNC Act committed by an unincorporated association or body of persons is taken to have been committed by each individual who was a director of the body or association at the time the body or association committed the offence. The ACNC Act does however set out defences which include “illness” and where all reasonable steps have been taken by the director to ensure that the association or body did not commit the offence or that there were no such steps that the director could have taken.
Administrative penalties may apply for failures of contraventions under the ACNC Act. In respect of an unincorporated association or body of persons the amount payable is payable by each individual who was a director of the association or body at the time the amount becomes payable.
The ACNC Act sets up a system of minimum governance standards that registered organisations are required to meet. Compliance with those governance standards is a condition of entitlement to registration.
Registered entities are required to take all reasonable steps to comply with the governance standards by 1 July 2013. The ACNC will enforce compliance with these standards. Basic religious charities are exempted.
The object of the standards is to provide a minimum level of confidence that registered entities will promote the effective and efficient use of resources, will meet community expectations about managing their affairs and use public money, volunteer time and donations, and will minimise the risk of mismanagement and misappropriation.
External conduct standards have also been enacted to give the public confidence that funds sent outside Australia by registered entities are reaching legitimate beneficiaries, are being used for legitimate purposes and are not contributing to terrorist or other criminal activities.
Organisations may still be subject to other regulators such as the ATO, the Office of Registrar of Indigenous Corporations (‘ORIC’) and other government agencies. The ATO remains responsible for administering taxation laws including deciding eligibility for tax concessions, ORIC continues as corporate regulators.
ASIC will remain responsible for fundraising.
It is understood that the ACNC will, however, accept financial questionnaires provided by non-government schools to DEEWR as meeting the requirement to lodge financial reports under the ACNC Act.
The ACT Government has announced that charities incorporated as associations in the ACT will only need to report to the ACNC and not the ACT Office of Regulatory Services.
Contact us for more information.Read more
On 16 May 2013 the Minister for Territory and Municipal Services, Shane Rattenbury, introduced legislation into the ACT Legislative Assembly that will remove restrictions that currently limit the ability to challenge ACT Government decisions in the Courts by standing.
The Administrative Decisions (Judicial Review) Amendment Bill 2013 (the Bill) will remove the requirement for a person seeking to challenge a decision to show that they are a person “aggrieved”.
The Bill is based on recommendations of the Australian Law Reform Commission. In its report, “Beyond the Door-keeper: Standing to Sue for Public Remedies” (Report no 78)the Commission recommended the replacement of statute-specific tests for standing with “a single test for standing on the basis that a uniform criterion for standing, consistently interpreted, would considerably simplify the existing process, reducing uncertainty, complexity and delay… [at 4.4].
The Bill will introduce “open standing” to seek judicial review of Government decisions. It will also give Courts the power to allow third parties to intervene in judicial review proceedings in some circumstances.
Under the Bill, any person may bring an action for judicial review unless:
• the law under which the decision is made expressly prevents the person from making the application; or
• all of the following circumstances exist: the decision is about an individual, review would prejudice the individual, the interests of the person bringing the review will not be adversely affected and the review does not raise a significant issue of public importance.
Judicial review involves an examination by the Court of the legality of a decision. The grounds for judicial review are limited and include, among other things, a failure to take into account a relevant consideration, making a decision which is beyond the power of the decision maker under the particular Act or making a decision in breach of the rules of procedural fairness. The Court will not consider the merits of a decision in judicial review proceedings.
Standing is the term used to describe a person’s entitlement to bring a case before a court. A person who lacks standing cannot bring Court proceedings. Currently, under the ACT Administrative Decisions (Judicial Review) Act 1989 (the ADJR Act), a person only has standing to bring proceedings for judicial review of an administrative decision if they are a “person aggrieved”. A “person aggrieved” is someone whose ‘interests’ are ‘adversely affected’ by the decision.
An extensive body of case law has been developed by the Courts on the issue of whether a person has an interest that is sufficient to give standing. Determining the question of standing can involve a lengthy and complicated legal argument and objections to an applicant’s standing are commonly made to avoid having poorly made decisions subjected to judicial scrutiny. Many now believe that the time spent arguing about whether a person should be allowed to challenge a government decision would be better spent dealing with the substance of their complaint about how the decision was made.
The Bill has been criticised by some on the basis that removing the existing standing requirements will “open the floodgates” to litigation and that it will now be “open slather to review planning and other ACT Government decisions”.
However, the experience in other jurisdictions with open standing provisions (such as New South Wales, where open standing provisions have been in place for over 30 years), shows that these fears are misplaced and wildly exaggerated. The reality is that the cost of engaging lawyers to bring legal proceedings and the risk of being ordered to pay the other parties’ legal costs in the event of an unsuccessful challenge, means that only those with a genuine concern about the legality of a Government decision are likely to bring such an action.
The Bill is to be debated at the next sitting of the Legislative Assembly on 4, 5 and 6 June 2013.
Contact our Government and Administrative Law Team if you have any queries.Read more
New obligations under the Liquor Act 2010 (ACT) (‘the Act’) came into force as of 1 June 2012. The new obligations place an onus on liquor license holders to hold Responsible Service of Alcohol (‘RSA’) certificates with significant penalties for non-compliance.
Section 100(1) of the Act provides that a licensee commits an offence if the person supplies liquor at licensed premises without an RSA certificate. In this context, a ‘licensee’ will include those persons listed on the liquor license, but should not extend to those directors of a company not listed and not involved in the supply of liquor to patrons. The term ‘supply of liquor’ will however include having alcohol on the premises for sale, so it is not a defence that individuals listed on the liquor license may never practically work behind a bar or serve patrons. Failure to comply with this section can attract a penalty of $5,500. Section 100(3) also provides that the penalty of $5,500 can be imposed on the licensee if an employee without an RSA certificate is engaged to supply alcohol to patrons.
Section 103 of the Act provides that a licensee can also face a $2,200 penalty for failure to keep a copy of RSA certificate of each individual noted on the license and each person employed to supply liquor. This offence is one of strict liability, meaning that elements of fault or recklessness are not necessary to attract the penalty. In practical terms, this means that the onus is on the licensees to ensure employees provide their RSA certificates to the venue’s management or else the licensee is open to risk of attracting liability.
Contact Ian Meagher for more information.Read more
Altogether too often young people die unexpectantly yet younger Australians are generally more difficult to convince to make a Will. What many young people fail to realise is that if they were to die, their estates tend to be larger than expected. This is due, in large part, to the compulsory inclusion of life insurance as part of superannuation. Take a moment to check how much your superannuation fund has insured your life for and then consider who you would prefer it went to.
A Will is a document in which you express what you wish to happen to your property after you pass away. Fundamentally, a Will must be signed on each page by the person making it and witnessed by two people over the age of eighteen. These witnesses should not be beneficiaries or relatives of beneficiaries under the Will.
A Will should always be professionally drafted. A word of warning – ‘Do-It-Yourself’ Will kits can feel empowering, but even a small error can cost more to rectify than having it professionally drafted in the first place. Our experience is that such Wills are a great deal more expensive to administer and tend to result in unintended consequences more regularly than their professionally-drafted counterparts.
Beyond giving you the certainty that your loved ones will be looked after,, some Wills go further and incorporate what are referred to as Testamentary Trusts. These options tend to be more attractive when estates are larger. You should speak to your financial advisor about whether such an option would be best for you.
Testamentary Trusts allow your beneficiaries to take some or all of their benefit in the form of a trust, where income or capital can be distributed from time-to-time. There are two key benefits to Testamentary Trusts:
• tax minimisation; and
• asset protection for beneficiaries.
The tax benefits come from the fact that, unlike family trusts, Testamentary Trusts can stream the income of the trust to minor children at adult marginal tax rates. For example, a family with three minor children can benefit from three $18,000 tax free thresholds before having to worry about the marginal tax rates which would apply to the adult parents. Again, you should speak to your financial advisors about how much this could save your beneficiaries.
A Testamentary Trust has mechanisms in place that prevent a beneficiary from controlling their trust when they are going through financial troubles, such as bankruptcy or a property settlement. This means that the Trust creates a barrier that may prevent creditors or a former spouse or partner obtaining any of the capital of the trust.
The down side to such benefits is that such documents tend to be more expensive. Speak to your beneficiaries and financial advisors to decide if a Testamentary Trust is right for you.
When a person dies without a Will an inflexible formula set down by legislation is used to divide the estate of the deceased without considering their known wishes, passions or interests. The formula changes with the circumstances of the deceased, varies from State to State, is seldom ideal at best and could be seriously inappropriate at worst.
The statutory formula can have unexpected applications. Take for example, a young couple without children who move in together for two years. In the ACT and New South Wales, if either were to die without a Will the other would be automatically entitled to the whole of the deceased’s estate. When the law deems a de facto relationship exists, it will then exclude other family members from taking a benefit regardless of the intentions of the deceased person.
Consider also a young couple who have been together for five years but have never quite met the standard required to receive the whole, or even a part, of the estate in the event of the untimely death of one of them. When the law deems a de facto relationship does not exist, it may require that the deceased person’s estate pass to estranged family members (for example, one or both parents or siblings) regardless of the intentions of the deceased person.
By requiring the estate to be divided in a one-size-fits-all fashion, you can be certain that some people who ought to have been provided for will not be and that some people who ought not to have been provided for will be. This may leave the estate open to a claim for further provision under the Family Provision Act 1969 (ACT) or the Succession Act 2006 (NSW) – litigation that the estate will have to bear at least some of the costs of, to the disadvantage of some or all of the beneficiaries.
Other costs are also increased when a person dies without a Will. Such costs include obtaining Letters of Administration, if required, and estate administration generally. Considering the time it may take friends or family to search for anything that resembles a Will and to locate your assets, these costs can become significant.
A little known, but easily understood, fact is that marriage automatically revokes a Will. Careful drafting Will can avoid this outcome, but if it is not dealt with at the time then despite your best efforts you may pass away without a Will. If you had a Will before you were married and are concerned that you may not have a Will, we are prepared to review your Will at no charge.
Seeing a solicitor about your estate planning goes beyond just drafting a Will; we also discuss estate assets, non-estate assets, superannuation and enduring powers of attorney. You could say that estate planning is akin to a complete legal health check-up.
Wills are forward-looking documents that everyone should consider, if only so they can have some say in how their estate is divided once they are gone.
Bradley Allen Love Lawyers are specialists in Will and Estate Planning and have considerable experience administering complicated estates.Read more
This is intended to be the first of a series of short pieces on highs and lows of innovations in credit cards currently emerging or expected to arrive in 2013, as well as some advice about what to do regarding old ways that still exist1.
According to the Reserve Bank of Australia’s April 2011 Credit Card Statistics, there were:
• 14.85 million credit card accounts in Australia;
• The national credit card balance totaled $49.4 billion;
• The average credit card balance was $3,326;
• The credit card balance accruing interest totaled $36.4 billion (74% of the total Australia collective credit card balance is accruing interest).
With this many credit cards, accounts, users and money involved, it is important to have some idea about the risks and advantages associated with credit card use and the current and emerging technologies.
One old technology that has well-and-truly had its day is the magnetic strip card.
If you still have a debit or credit card that uses magnetic strip technology as its only means of protection, it is time to visit your financial institution (bank, building society or credit union) and request a change.
The majority of forged credit cards are of the old magnetic strip variety and couriers working for organised crime groups still move forged cards around the world in bulk. Magnetic strip readers have been around for decades and allow criminals to actually read and duplicate the information contained on the strip.
This makes forging an exact copy of a magnetic strip card easy for organised criminal groups. The equipment required to forge an exact copy has been reduced to the size of a large briefcase and can be easily transported by the card forgers.
Also known as EMV (Europay, MasterCard & Visa), cards using Chip and Pin technology have existed for several decades overseas and many of you will already have had some experience with the technology as it has rolled out here in Australia.
So why has it been slow to the market in Australia? You can ask your bank, but don’t expect a straight answer. A lot of it has to do with the fact that banks and card companies have been able to pass on the cost of card fraud to the public for decades.
Credit card fraud typically falls into two main groups – counterfeit cards and card-not-present (CNP) fraud. According to the website australia.creditcards.com, in 2008 counterfeit credit cards cost Australians $49 million, while CNP fraud cost $71 million. This included fraudulent mail, telephone and internet transactions. As it has now been over four years since those amounts were recorded they are likely to now be significantly higher.
It has only been with the growth of internet use and identity fraud awareness that banks and card companies in Australia have had to adapt to the new technology.
With EMV credit cards, banks use a “chip and pin” or “chip and signature” authentication system. This system is significantly more secure than the traditional magnetic strip. This is because the chip produces a unique code for each transaction, making it easier to trace and easier to crack down on fraud.
According to Forbes Magazine, mobile phone payments have the potential to be more secure than any payment system yet designed. Contrary to popular fears, paying with your smartphone is a way to guarantee the security of your transactions.
Mobile payments allow for a variety of authentication mechanisms, ranging from passwords to location services to serial numbers and even on-demand QR codes (a QR code [abbreviated from Quick Response Code] is the trademark for a type of matrix barcode (or two-dimensional bar code) first designed for the automotive industry in Japan).
With that many varying authorisation points of available, it is increasingly difficult for criminals to crack the code on an individual phone. Yes, if you lose your smart phone or you don’t secure it with a password, you may be vulnerable. That said, most people are more conscious of where their phone is than where their credit cards are. You are therefore more likely to quickly notice that your phone is missing and actually take action to inform the right people.
‘Show-rooming’ has been described by some as a ‘slap in the face’ for full service merchants who have the added expense of maintaining a shop front and paying staff to serve customers. For the last few years, such merchants have been complaining loudly about the problem of show-rooming. Show-rooming occurs when a person walks into a retail store, checks out an item in-person, selects the right size, style, colour and options – and then goes online and buys the same item at cheaper ‘internet price’, usually from a merchant who does not have the added costs of maintaining retail premises.
Let’s be clear. Show-rooming is not illegal. Many argue that it is just sound economics while others claim that it is driving retail stores to the wall. As usual, the truth lies somewhere in between. If everyone show-rooms, then shop-front retailing is likely to eventually be something from “the good old days” that we tell our grandchildren stories about. There are a number of downsides to show-rooming, not the least of which is that you have to wait days and sometimes even weeks for delivery.
So how do retailers combat show-rooming? As the Internet matures and becomes more sophisticated, so consumers will expect sellers to provide more information about stock, including availability on a localised basis. The idea is for retailers to combine the in-store experience with the on-line experience to enhance the service they provide to their customers.
Wouldn’t it be great if you could get a bargain and be able to pick it up locally on the same day? With new advances in stock management and on-line publishing in real-time, you should be able to expect that your shop-front retailer will be able to tell you what they have in stock and where it is located. Furthermore, they should also be in a position to roll-out loyalty programs and on-the-spot discounts to regain and keep your custom. All they have to do now is actually employ in-store staff who care enough about customers to actually serve you when you walk in the front door!
The concept of the electronic “mobile wallet” has existed for years now. The problem has been that there are a number of systems around and no single system has been able to dominate the marketplace. That is probably a good thing as it gives the consumer the choice and it is choice that ultimately ensures competition. This in turn keeps prices down. There is something to be said for having a range of options available to you to pay for your purchases. So the next time you are encouraged to sign up for the ‘one-stop-shop’ of payments, don’t just think about what you might be gaining. Also think about what you might be losing in the way of choice and cost!
The banks will tell you that direct credits and on-line funds transfers are as safe as houses. Think again. For a start, the banks almost always take your money out of your account straight away. They don’t, however, deposit it into the receiver’s account at the same time.
So what do they do with it in the intervening period? Well, if you play with enough people’s small transfers in this way, you can make quite a bit of small change on the short-term market. The banks will officially tell you otherwise, but use your own commonsense.
There are also numerous examples of funds simply being sent to the wrong account, the wrong branch and even the wrong bank, despite the sender having done everything correctly. And it usually ends up being the parties to the transaction who actually have to track things down, because banks simply don’t employ the staff to get involved in such low-level problems unless compelled by law. Stay tuned, as there are indications that the law may be catching up with the banks in this area in 2013.Read more
It is a fact of life that many of us will grow old before we finally pass away. Since we are living to ever greater ages (the current life expectancy in Australia for males is 79 and females, 84) we are seeing increasing incidences of debilitating diseases such as dementia. As dementia or other illnesses progress, a person can very rapidly lose the ability to make decisions for themselves regarding their property, where they live or what medical treatment they do or do not receive. This can place on their partner, or next-of-kin, the additional burden of applying to the ACT Civil and Administrative Tribunal to become their Guardian or Manager to get powers of attorney.
The ACT Civil and Administrative Tribunal includes the Guardianship Tribunal. The tribunal is tasked with the appointment oversight of Guardians and Managers. Guardians are empowered to make decisions in relation to the health and welfare of the person, while the Managers are empowered to make decisions in relation to the person’s financial and property affairs.
Once a Guardian and/or Manager is appointed, the Guardianship Tribunal must review the appointment at least once every three years, though it can be done more regularly if the Tribunal decides it is necessary. This places a need for the Guardian and/or Manager to attend the Tribunal at least once every three years. If other friends or family members wish to contest the appointment then solicitors can become involved (although the Guardianship Tribunal is normally a ‘lawyer-free’ zone).
The Guardianship Tribunal does not make such appointments on behalf of another lightly, however, and will only appoint someone as Guardian or Manager when there is a need to make decisions for a person. When there is no longer a need for decisions to be made the appointment of the Guardian or Manager is likely to cease. However, should it become necessary to make decisions again in the future a further application will need to be made and the appointment can be resumed, or a different appointment can be made.
The Guardianship Tribunal is also empowered to oversee the actions of an Attorney under an Enduring Power of Attorney.
Sadly, it is not only older people who lose capacity. We all too often hear stories of young people who, as the result of a disease or an accident, lose the capacity to make decisions for themselves. As no one is invincible, young people should also plan for the unlikely event that they may not be able to make decisions for themselves in the future.
By preparing a valid Enduring Power of Attorney in advance a person can plan for the worst by appointing someone of their own choosing to act as their attorney in relation to property, personal care and medical care matters.
The person making the Enduring Power of Attorney may appoint more than one attorney and different attorneys for each of the different functions. The Enduring Power of Attorney may also set out conditions or directions for certain types of decisions. For example, restricting the power over finances to certain assets or dealing with end of life matters. Attorneys do have a great deal of autonomy so only trusted people should be appointed.
The power to deal with medical and personal care matters only comes into force if the person is no longer able to make decisions for themselves. The attorney’s authority over financial matters can commence immediately, on a date of the person’s choosing or when the person loses decision-making capacity. It is useful in some contexts to have the power commence immediately. However, it is most common for the power to commence only when the person loses capacity. Enduring Powers of Attorney are designed to give broad powers and flexibility to enable decisions to be made while a person is incapacitated.
There are times when a person has capacity but it is convenient or necessary to have someone else act on their behalf. In this case, a General Power of Attorney may be useful. A General Power of Attorney may empower an attorney to act for a specific purpose (e.g. to sign contracts and other documents for the sale or purchase of a property) or for a specified time (e.g. while the person is overseas). An appointment under a General Power of Attorney is only effective while the person continues to have capacity.
For Enduring and General Powers of Attorney the attorney must act only in the interests, or pursuant to the specific instructions, of the person who has lost the ability to make decisions for themselves. Powers of Attorney, whether Enduring or General, are fundamentally empowering and protective for the person making it – and you never know when they might be useful.
Bradley Allen Love Lawyers are specialists in Will and Estate Planning and are able to prepare Enduring Powers of Attorney for all Australian jurisdictions and appear in the Guardianship Tribunal.Read more
Due to a number of fatal and serious accidents on Canberra construction sites and the ACT Government cracking down on work health and safety, property developers should be considering and reviewing their occupational health and safety obligations under the Work Health and Safety Act 2011 (ACT). Since coming into effect on 1 January 2012, the workplace health and safety Act has placed stringent requirements on all employees including developers to ensure the health safety and welfare of the people at their place of work.
While delegation of certain work health and safety responsibilities is possible, ultimate responsibility remains with the developer to ensure all legislative responsibilities are correctly delegated. In certain cases a developer may be unable to pass on certain obligations under the workplace health and safety Act because the contractor they attempt to delegate too has inappropriate or insufficient experience to implement correct procedures or compliance systems.
Given issues of liability, developers need to ensure that construction contracts used clearly set out who is responsible for implementing and complying with work health and safety on site. Furthermore, developers should be taking proactive steps to review safety and management plans on-site. This should include periodic site inspections to ensure a contractor is complying with directions regarding work health and safety.
If a developer fails to properly delegate responsibility under the act they may be deemed to be the principal contractor responsible for all aspects of work health safety and be subject to extensive and burdensome administrative and practical obligations. In addition as demonstrated recently, failure to comply with the workplace health and safety Act can lead to infringement notices being issued, construction sites being shut down or criminal or civil proceedings being brought against developers, which delay works and increase costs.
The ACT Work Safety Commissioner has stated that there will be a campaign to examine “…safety management systems implemented by medium to large commercial construction companies in the ACT.” “This is to ensure companies are taking all the necessary steps to adhere to the Territory’s work safety laws,” Mr McCabe said.
In this climate it is crucial that developers ensure that they meet all legislative requirements and correctly delegate responsibility for work health and safety during construction to minimise cost and risk, whilst also ensuring workers interests and health is protected.
If you have any questions regarding the above, or wish to have your current policies or contractual obligations reviewed please do not hesitate to contact Bradley Allen Love Lawyers.Read more
In order to make sure that your interests as a business owner are protected, it is imperative to have a plan in place which details what will a happen if a business owner departs, and how the various business owners relate to one another.
We have recently concluded a number of transactions, across a range of different clients, to establish shareholder and unitholders agreements as well as “buy-sell” and “business continuity” arrangements between respective business owners. These types of arrangements are so successful and important to a business’ development and continued existence because they provide the business owners with certainty about their ongoing relationship, rights and responsibilities and provide a means to protect the business and their investment in the event of the loss of a business owner.
All business owners should be alert to the need to have a shareholder or unitholder agreement; amongst other things, that such an agreement should deliver to an owner a reliable right to realise their investment should they choose to depart the business. Without one, there might be none.
Whilst a company’s constitution is normally available for public inspection, a shareholder or unitholder agreement provides the opportunity for a confidential contract which governs the relationship between shareholders (or unitholders) and their rights, the control and management of the company as well as regulating the ownership and protocol for admitting new business owners.
Often business owners do not turn their attentions to the need for such a document until a dispute has already arisen and disputes between shareholders can be very difficult to navigate through. This is particularly so when there is no consensus between the business owners as to their expectations of the business and each other. Continuing to operate a business with a hostile business owner can be near impossible.
Whilst each business is different and therefore business owners will have different expectations of how they envision such a document, shareholder / unitholder agreements generally include:
We would strongly recommend that any such shareholder or unitholder agreement also include the mechanisms for dealing with the impact of a death or total and permanent disability of one of the business owners.
Often business owners will only deal with the here and now, but on the death or disability of a business owner, the issues remain:
The purpose of the buy-sell agreement is to specifically deal with the funding of buyouts and loss to a business arising from the loss of a business owner.
Personal experience from Williams Love & Nicol (part of the firm that is now known as Bradley Allen Love), with the loss of a key partner in the business some years ago, stands as testament to the importance of considering and having in place such a succession plan. These arrangements cannot be properly implemented without an appropriate financial planning matrix in place.
For business owners, having an agreed and predictable pathway to value and realise a former business partner’s rights to ownership saves the cost, time and anxiety of a later dispute at a time when the continuing business owner’s are coping with a traumatic loss.
Further, having such an agreement backed by insurance (which is paid out on the triggering of an event such as death or disability) provides security that funds will be available to the continuing shareholders, unitholders and the company to enable the transfer of ownership to take place without a heavy financial burden.
This area of asset protection involves a complex consideration of investor rights, corporate governance and taxation issues; where that tax consequence must consider the effect on the business itself, as well as the consequence for the individual owners of the business.
In summary, the buy-sell agreement controls business decisions regarding:
Having the agreement in place provides a sense of certainty and allows for the buy-out to take place without significant delay for the parties.
Contact Katie Innes for more information.Read more
The Work Health and Safety Act 2011 (ACT) (‘the Act’) came into force as of 1 January 2012 and significantly increases the risks for those responsible for managing businesses. The new laws expand the range of employers, organisations and employees with managerial responsibilities caught by the Work Health and Safety laws and also increases the people that a duty of care is owed to.
The major change is the level of liability and definition of “Officers” within any organisation that is undertaking or carrying on business within the ACT. Officers now include senior management, board members, directors and some levels of senior staff.
Directors, board members and employers undertaking any form of business within the ACT should all be aware that breaches of Work Health and Safety are now covered in a criminal regime, with maximum penalties for serious breaches being individual financial penalties of up to $600,000.00 and/or goal terms of up to 5 years. As the new laws attach personal liability to directors and senior level employees, internal policies to have any penalties paid by the company employer and relevant insurances may be deemed void if so viewed as contempt by the legal system. The fact that breaches are now criminal offences will have ongoing ramifications as criminal charges can disqualify current Directors from holding management positions into the future.
The purpose of the new act is to bring the ACT into line with the national harmonisation of the Work Health and Safety laws. These new Acts across all state jurisdictions put more onus on management to take a proactive role in mitigating risk within the work place, and putting into place procedures and policies that will protect workers and the public from any risks created by their business.
Given the nature of this duty and the scope of ‘due diligence’ under the Act, “Officers” of companies cannot simply rely on the fact that a company has a Work Health and Safety Policy in place. They are now required under the new legislation to take reasonable steps to ensure a personal knowledge and understanding of Work Health and Safety matters within the organisation and the operations put in place to minimise any potential hazards and risks. It is therefore important that any internal policies support a system where safety concerns are not only documented and attended to, but senior management is personally made aware of the concern.
Importantly the breadth of the duty of care under the Act extends to protecting volunteers, contractors and students on placement within work places and can extend as far to the general public who are exposed to the activities of your business even outside of work hours and work premises.
The extensive scope of liability means that all businesses should be reassessing their current procedures in how they deal with and delegate Work Health and Safety risks within their business. While existing OH&S policies and procedures will have to be amended to comply with all of the procedural requirements of the new legislation the biggest challenge of employers will be to ensure that their senior management and directors are fully informed to avoid the possibility of significant penalties.
Things that could help compliance in this nature would include the following:
Review all OH&S manuals and procedures and ensure they comply with the new Work Health and Safety Laws;
• Receive briefings from Work Health and Safety professionals;
• Ensure all Work Health and Safety Representatives and officers within your organisation receive appropriate and up to date training;
• Ensure your company is devoting enough time and money to comply with legislation;
• Ensure best practices are enforced within your workplace and documented;
• Ensure that Directors and managers are receiving frequent, accurate and reliable information regarding the state of Work Health and Safety within the workplace; and
• Ensure that independent inquiries are made by officers of your organisation where appropriate.
This is a major reform of Work Health and Safety legislation and it is critical that all businesses remain proactive in their procedures and policies to ensure that they do not breach their obligations. If you require any further information regarding Work Health and Safety compliance, and steps that your business should undertake to ensure compliance please do not hesitate to contact Bradley Allen Lawyers.Read more