Unregistered Lease interest and the sale of a property

Posted on September 27th, 2018

Unregistered Lease interest and the sale of propertyWhen an owner sells a property that is subject to existing tenancies, it is always preferable to have the relevant leases to the tenants registered on title. This ensures that the lease automatically, by virtue of the Real Property Act (NSW) transfers to the purchaser on settlement and the tenant’s leasehold interest is preserved in the subject property.

However, it is not uncommon for a lease not to be registered on title. Usually, this arises in circumstances when the term of the lease (and any option to renew) does not exceed three (3) years. Read the rest of this entry »

Can lease obligations operate ‘prior’ to the commencement date of the Lease?

Posted on June 25th, 2018

Can lease obligations operate 'prior' to the commencement date of the Lease?Will a Court enforce provisions of a lease against a party in respect of a period of time prior to the commencement date of the lease? This was one of the questions raised in Bonafair Holdings Pty Ltd v Hungry Jacks Pty Ltd.

His Honour, Sackville AJA, concluded that the language used by the parties in the relevant clauses will be determinative on the issue. “It is of course possible for a lease to contain provisions attaching consequences to events or conduct pre-dating commencement of the lease… However, in the absence of any language evincing a contrary intention, provisions in a lease for a term of years ordinarily create rights and obligations between the lessor and the lessee as and from the date the term of the lease commences“. Read the rest of this entry »

Liability in the absence of a therapeutic relationship

Posted on April 4th, 2018

The NSW Court of Appeal recently found a medical treatment provider was liable for personal injury, even though there was never a therapeutic relationship with the person who was injured.

Briefly, a Mr Mason suffered from psychological illness for which he was taking medication. He was remanded in custody on criminal charges, to Parklea Correctional Centre. It was privately operated by GEO Group under contract with the State Government. The contract required GEO to provide psychological and counselling services to inmates.

When Mr Mason was processed at Parklea, he told employees of GEO about his conditions and medications, but he was not prescribed any replacement drugs nor referred for counselling or other treatment. Days later, he jumped from a high level landing and suffered personal injury. He then sued GEO for those personal injuries. That case settled, but a related claim between GEO and its insurer continued because the insurer contended that its policy did not provide cover unless GEO had actually provided (medical) services. Read the rest of this entry »

Rental car agreements & drink driving

Posted on April 3rd, 2018

It is a common provision in car rental agreements that if the car is damaged as a result of the driver breaching a law in force where the accident occurs, insurance coverage will not be available. The clauses are often drafted to cover a wide range of breaches of the law but that would almost always include an accident that occurs when the driver was “over the limit” for blood alcohol.

One of the features of the Insurance Contracts Act, which governs a number of classes of insurance policies including car rental agreements, is that if there is a “technical” breach of the policy, but that particular breach did not cause the loss or increase the risk of loss, the insurer may not be able to refuse cover. However, that principle only applies where a policy of insurance exists – as Gardam’s case shows, it has no application to a document (such as a rental agreement) that is not an insurance contract. Read the rest of this entry »

Who’s liable for unsafe rental premises?

Posted on January 11th, 2018

The N.S.W. Court of Appeal recently considered the respective liabilities of a landlord, managing agent and tenant arising out of the collapse of a balcony at a rental property at Collaroy, on the Northern Beaches of Sydney (Libra Collaroy Pty Limited v Bhide).

In 2005, the landlord engaged a real estate agent to manage their residential rental property pursuant to a Management Agreement. During the tenancy, the tenant raised numerous issues concerning the state of repair of the upstairs balcony. The managing agent obtained quotes for repairs and forwarded these to the landlord however these were not acted on.

In 2012, the balcony collapsed injuring 4 people, including the tenant’s daughter. The 4 injured persons commenced proceedings against the landlord and the managing agent for their injuries and the tenant also commenced proceedings against the landlord and the managing agent for psychological injury. The landlord and managing agent issued cross claims against each other and also against the tenant. Read the rest of this entry »

Buying or selling an RTO?

Posted on January 10th, 2018

If you are buying or selling a Registered Training Organisation (“RTO“) it is very important you engage a competent solicitor who has experience in dealing with RTOs.

In addition to dealing with the usual sale of business considerations, including without limitation:

  • Stock,
  • Goodwill,
  • Plant & Equipment (including discharging securities),
  • Restraints,
  • Employees,
  • Leases/Licence Agreements/Supplier Agreements/Franchise Agreements, and
  • Intellectual Property;

The sale or purchase of an RTO must also deal with the government department known as the Australian Skill Quality Authority (“ASQA”).  Read the rest of this entry »

Naming your small business start-up – what to consider

Posted on January 10th, 2018

 

One of the first things to do for your small business start-up is choosing a name. It is also one of the most exciting! It is a creative opportunity to come up with the name that will identify your business going forward and build your successful empire (hopefully)!

 However, there are some unexciting legal considerations that should also be addressed during this process. The main one is to ensure that you are not going to infringe on anyone else’s intellectual property rights when settling on your name or be accused of trying to pass off as another business with a similar name. There are some administrative headaches that can also be avoided if you put some effort into identifying the current marketplace before settling on a name.  Read the rest of this entry »

You need to amend your trust deed

Posted on December 15th, 2017

Recent amendments to transfer duty and land tax legislation may affect every Family/Discretionary Trust that either purchases or holds land in New South Wales.

A Family/Discretionary Trust is often used as an asset protection structure as the trustee normally has wide discretionary powers to distribute income and capital to wide classes of beneficiaries under the trust.

However, this wide discretionary power may cause a Family/Discretionary Trust to fall foul of the legislative amendments in 2016 targeted at “foreign persons” acquiring and holding land in NSW. Foreign persons are now subject to a 4% surcharge purchaser duty when acquiring residential land and a 0.75% surcharge on land tax where a foreign person holds residential land in NSW.   Read the rest of this entry »

Is your website a ‘business record’?

Posted on October 31st, 2017

Most of us understand, at least generally, that for material to be considered by a trial judge in the course of a hearing it must comply with the ‘rules of evidence’.  Both under the common law and under both the NSW and Commonwealth Evidence Acts, one class of material that can generally be given in evidence is ‘business records’.  The broad theory behind this is that businesses will generally maintain accurate records of how they have been conducted (for example as to who their customers are, what revenues they generate, how they carry out production etc) and that their historical records are therefore generally reliable material for the purpose of a court making decisions.

However when the ‘record’ is in the nature of advertising or promotional material, while it is certainly a document created by a business, the courts tend to be much more cautious as to whether these are ‘business records’ in the relevant sense.  The distinction seems to be whether documents are records of a business; or the product of it.  Consequently in recent times the courts have rejected attempts to tender, as business records, both corporate magazines (Australian Competition and Consumer Commission v Air New Zealand Limited (No. 5) [2012] FCA 1479 and extracts from a company’s web page (Clipsal Australia Pty Limited v Clipso Electrical Pty Limited (No. 43) [2017] FCA 60).  Read the rest of this entry »

Legal practitioners acting against previous clients

Posted on October 23rd, 2017

In what circumstances is a lawyer permitted to act against a previous client? The Supreme Court of New South Wales recently addressed this matter in Gujarat NRE India Pty Ltd v Wollongong Coal Limited [2017] NSWSC 209

The proceedings were conducted by way of a compressed urgent hearing which was held shortly before the main proceedings. The main proceedings were between Gujarat NRE India Pty Ltd (“NRE“) and Wollongong Coal Limited (“Wollongong Coal“). NRE was suing Wollongong Coal for damages suffered by NRE as a result of a default by Wollongong Coal under a commercial agreement for which NRE had guaranteed the obligations of Wollongong Coal.

The commercial agreement was called the Override Deed and enter into July 2013. The Override Deed required Wollongong Coal to pay $20,411,033.00 to a third party, UIL (Singapore) Pty Ltd. Wollongong Coal defaulted under the Override Deed and NRE was required to pay the balance in full to UIL.  Read the rest of this entry »

Think before you terminate!

Posted on August 15th, 2017

If you are thinking of terminating a contract that is of any significance, you must obtain legal advice prior to doing so.

Too often we see people take action to terminate a contract as a result of circumstances that they consider entitle them to terminate the contract and suffer significant consequences as a result.

If you terminate a contract or attempt to terminate a contract in circumstances where you are strictly not entitled to, or do so in an inappropriate manner, the other party may be entitled to treat your termination or attempted termination of the contract as a repudiation of the contract. Read the rest of this entry »

A.I. & the legal profession – should we be afraid?

Posted on August 15th, 2017

There has been significant advances in the development of Artificial Intelligence (A.I.) in recent times and a big deal made about A.I.’s impact on peoples’ jobs into the future.

So, should the legal profession be afraid? Are we going to be replaced by A.I. and our jobs become obsolete?

The short answer is no. In my humble opinion, if you subscribe to the above line of questioning, you are asking the wrong questions entirely. Read the rest of this entry »

Employee restraints of trade – are they enforceable?

Posted on July 12th, 2017

The case of Thinkstorm Pty Ltd v Farah [2017] NSWSC 11 recently addressed the issues of employment restraints and their enforceability in the context of employment contracts.

The facts of the case involved the employer (Thinkstorm) seeking to enforce a restraint of trade provision by way of injunction against one of its previous employees (Farah). Farah had worked for Thinkstorm as a computer engineer using the computer software known as WorkBrain and provided services to Queensland Health on behalf of Thinkstorm. Farah’s employment contract contained a generic restraint of trade clause providing that Farah must not directly or indirectly, for a period of 12 months following the termination of his employment, solicit, canvass, deal with or approach any person, firm or company for which Thinkstorm provided goods or services to at any time during the last 12 months of Farah’s employment with Thinkstorm. Immediately following Farah’s resignation from Thinkstorm, Farah accepted an employment contract with Queensland Health.  Read the rest of this entry »

When is a deposit refundable under a business sale agreement?

Posted on July 10th, 2017

The case of Sarker Trading Pty Ltd v Vanage Pty Limited [2016] NSWDC 250 recently addressed the issue of deposits and whether or not a deposit can be forfeited under a Business Sale Agreement where the Agreement is rescinded.

The facts of the case are:

  • Sarker, as purchaser, entered into a Business Sale Agreement with Vanage for the purchase of a Subway Franchise in Forestway NSW for $95,000.00 (“the Agreement“).
  • The Agreement provided that it was a condition precedent to completion that Sarker be approved as a Franchisee of Subway.
  • Sarker paid an initial deposit of $10,000 (10.5%) and a further “Security Deposit” of $75,000.00.
  • Sarker failed the relevant “Skills Test” performed by Subway required to be approved as a Franchise.
  • Sarker sought to rescind the Agreement for an inability to satisfy a condition precedent to completion.
  • Vanage asserted it was entitled to retain the deposit and the Security Deposit.

Read the rest of this entry »

Can I have a copy of the Will?

Posted on June 28th, 2017

When a person makes a Will he or she is not obliged to show the Will to anyone. Some people do, some people don’t. However, after the Will maker has died, certain people are entitled to a copy of the Will as provided for in Section 54 of the Succession Act 2006. Those people who are entitled to a copy are:- 

 

 

Read the rest of this entry »

Damage claims for repairs when leasing – Part Two

Posted on June 28th, 2017

The NSW Court of Appeal case, Ellis’s Town House Pty Ltd v Botan Pty Ltd [2017] NSWCA 20, is a particularly interesting case as it addresses two separate but interesting issues, being:

  1. What is the correct method of assessment of damages under a Lease for a breach of painting and repairing covenants? and
  2. When a party may make an application to appeal from a Judgment of the District Court for amounts under $100,000.00.

The facts of the case together with the measure of damages have been discussed in Part 1 of this series of articles.  Read the rest of this entry »

Damage claims for repairs when leasing – Part One

Posted on June 28th, 2017

The NSW Court of Appeal case, Ellis’s Town House Pty Ltd v Botan Pty Ltd [2017] NSWCA 20, is a particularly interesting case, as it addresses two separate but interesting issues, being:

  1. What is the correct method of assessment of damages under a Lease for a breach of painting and repairing covenants? and
  2. When a party may make an application to appeal from a Judgment of the District Court for amounts under $100,000.00.

We will address these two issues in two parts over two separate articles. Read the rest of this entry »

Marriage, divorce and your Will

Posted on May 23rd, 2017

It is not uncommon for an individual to overlook reviewing his or her Will at the time of marriage, divorce or separation. Section 12(1) of the Succession Act provides that a Will is revoked by the marriage of the Will maker. However, if a Will is made in contemplation of marriage then the subsequent marriage of the Will maker does not revoke the Will.  

However, if an individual makes a Will in favour of his or her spouse and then marries that person, the Succession Act provides that the disposition to the person to whom the Will maker is married at the time of his or her death will not fail (i.e. the surviving spouse can receive his or her share under the terms of the Will).  Read the rest of this entry »

Successful company with storm clouds on the horizon

Posted on May 19th, 2017

Company planning is imperative. I recently saw a client of mine who was a director and shareholder in a very successful Hunter Valley company. Let’s call them Company Y. 

Many years ago, my client set up Company Y with his good friend and business partner. They were/are both directors and shareholders in Company Y. When Company Y was established a generic Company Constitution was produced on registration. The Company Constitution was not appropriate for the purposes of Company Y.

 

Read the rest of this entry »

Sale of business vs company sale

Posted on May 19th, 2017

In this article we will look at the differences between the sale of a business and the sale of a company including a few of the pros and cons for each. 

Firstly, there is a significant difference between the sale of a business and the sale of a company. A business is an enterprise usually engaged in to generate revenue (i.e. the business of selling food or the business of providing accounting services).  It is possible for a business to be operated/owned by a number of different entities (such as individuals, companies or trusts). When a business is sold, it is sold from one entity (the owner) to another entity (the purchaser). Usually the sale of the business will consist of the transfer of assets, goodwill, intellectual property, licences, business name, plant and equipment.  Read the rest of this entry »