Rights between joint guarantors
The NSW Supreme Court recently dealt with a claim for contribution between multiple guarantors. In simplified form a company “OD” loaned money to an incorporated legal practice. The loan was guaranteed by three individuals and a further company Trout Hall “Trout”. The loan was not repaid. Two of the three individual guarantors became insolvent. The lender sued the remaining individual guarantor, Mr Robert Clancy, and he cross claimed against Trout. 
Prior to final hearing Mr Clancy paid an amount to the lender to settle the claim against him. Ultimately, the Court held that Mr Clancy had paid more than required. Trout argued in its defence that because of the payment by Mr Clancy no amount remained owing from it to the lender. It seems the lender accepted that argument because the claim between the lender and Trout also resolved. Read the rest of this entry »
Who bears costs when a case is settled?
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and specialises in commercial dispute resolution & litigation, and employment law.
The NSW Court of Appeal recently had to consider whether costs should be awarded, in circumstances where a plaintiff accepted a settlement offer from a defendant which had been made prior to a hearing; but which was not accepted until after the hearing and when the Court’s judgment was reserved. The defendant’s offer was explicitly said to be “exclusive of costs”. 
The defendants later made an application that they be awarded the costs of proceeding, and the plaintiff contended that was a breach of the agreement, that entitled the plaintiff to damages. In this context it must be remembered that an agreement to settle litigation is a form of contract, and that usual contractual remedies are available for any breach of it. The Court rejected the plaintiff’s claim that the words “exclusive of costs” meant that it was an implied term of the contract that each party would bear their own costs. Rather, consistent with decisions made in relation to formal Offers of Compromise, the phrase meant the settlement agreement did not deal with costs at all. The issue had to be dealt with under the general law rather than under the terms of a settlement contract. Read the rest of this entry »
Extending Time To Pay – Are There Risks?
Particularly amongst family members, or close friends, it is not uncommon for money to be loaned under oral agreements. In its simplest form, it might be an agreement between friends to “spot” $50.00 until payday. In more sophisticated contexts, it may be an agreement to loan substantial amounts of money simply on the promise that the borrower will repay that amount, with or without interest. 
The NSW Court of Appeal recently looked at a situation involving an original oral loan agreement; and a claim the repayment date had later been varied, also by oral agreement.
Do I need a Shareholders Agreement?
Lachlan Page is a Solicitor at Mullane & Lindsay and is part of our Commercial, Property & Estates Law team.
When setting up a business one of the simplest and most selected structures is the registration of a company.
Whilst business owners are becoming more and more savvy and often no longer require their Solicitor or Accountant to register a company for them, it is concerning the number of business owners that stop the set up process after registration of the company.
One of the most important documents you should have when you operate a company structure is a Shareholders Agreement. Read the rest of this entry »
Security of Payments Act – how do I enforce an adjudication?
Lachlan Page is a Solicitor at Mullane & Lindsay and is part of our Commercial, Property & Estates Law team.
This article is part of a series of articles that provides an overview of the Security of Payments Act Regime in NSW and explores how to enforce and Adjudication Determination under the Building and Construction Industry Security of Payment Act 1999 NSW (“the Act“).
When an Adjudicator has made a decision in relation to an Adjudication Application the Adjudicator will provide an Adjudication Determination. This is essentially the judgment of the Adjudicator. The Adjudication Determination will include detailed reasoning of the Adjudicator and a final determination of an amount payable to the Applicant.
It is not uncommon for an Adjudicator to require that the Adjudicator’s fees be paid prior to releasing the Adjudication Determination. The Adjudicator will also determine who should be responsible for the Adjudicator’s fees and this usually is paid by the unsuccessful party. Read the rest of this entry »
Contractual Penalties – a change in landscape
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and specialises in commercial dispute resolution & litigation, and employment law.
The concept of a “penalty” in Australian law is relatively easy to state, but often difficult to apply in practice. In essence, where a contractual provision (or some collateral arrangement) imposes an obligation for breach of contract, that is disproportionate to the actual cost or loss resulting from the breach, it can be set aside as a “penalty”.
Take a simple example of a contract to purchase a car for $10,000.00. It has a condition that if the purchasers do not complete the purchase on a specified date they must pay $1,000.00 per day, in addition to the price, until settlement occurs. That additional sum is obviously disproportionate to the vendor’s actual cost of delaying settlement. By contrast, a provision that is a genuine pre estimate of the injured party’s costs or losses will not be a “penalty”. Using the ‘sale of a car’ scenario above, if the ‘price’ for a delayed settlement was set by reference to the vendor’s actual holding costs (for example if the vendor’s loan repayment was $10 per day and the ‘price’ of delay was also $10 per day) it can readily be seen that the additional payment is a genuine pre-estimate of loss. Read the rest of this entry »
Security of Payments Act- Adjudication Process
Lachlan Page is a Solicitor at Mullane & Lindsay and is part of our Commercial, Property & Estates Law team.
This article is part of a series of articles that provides an overview of the Security of Payments Act Regime in NSW and explores the Adjudication process under the Building and Construction Industry Security of Payment Act 1999 NSW (“the Act“).
As discussed in my previous article, the adjudication process under the Act is an extremely useful tool in assisting contractors and subcontractors to enforce payments in the building and construction industry.
When a party is entitled to make an Adjudication Application, the Act requires that the application must:
- be made in writing,
- be made to an authorised nominating authority,
- identify the Payment Claim and Payment Schedule (if any) to which it relates,
- contain relevant submissions and supporting material, and
- be accompanied by the relevant application fee.
Security of Payment Act – When to adjudicate?
Lachlan Page is a Solicitor at Mullane & Lindsay and is part of our Commercial, Property & Estates Law team.
This article is part of a series of articles that provides an overview of the Security of Payments Act Regime in NSW and explores when you can adjudicate under the Building and Construction Industry Security of Payment Act 1999 NSW (“the Act“).
The Act provides the ability for a party to have a dispute adjudicated by an Adjudicator and a Determination made that is capable of registration as a Judgment debt and enforcement by the Courts. The benefit of the adjudication process is that an enforceable decision can be obtained within weeks of a party making an Application for adjudication. This is in keeping with the underlying purpose of the Act designed to ensure that contractors and subcontractors receive payment in a timely manner. Read the rest of this entry »
Security of Payment Act – What is a valid payment schedule?
Lachlan Page is a Solicitor at Mullane & Lindsay and is part of our Commercial, Property & Estates Law team.
This article is part of a series of articles that provides an overview of the Security of Payments Act Regime in NSW and explores the notion of a Payment Schedule under the Building and Construction Industry Security of Payment Act 1999 NSW (“the Act“).
A Payment Schedule is a document provided in response to a Payment Claim under the Act that essentially puts forward a respondent’s position in relation to a Payment Claim. A Payment Schedule will usually state that the respondent intends to pay the full amount contained in the Payment Claim or a lesser amount than that contained in the relevant Payment Claim.
It is vitally important that when providing a Payment Schedule under the Act, that the Payment Schedule be a valid Payment Schedule. If a Payment Schedule is not considered to be a valid Payment Schedule, significant rights may arise in favour of the party who has issued a Payment Claim, including, a statutory right to payment for the amount set out in the corresponding Payment Claim. Read the rest of this entry »
Security of Payments Act – what is a valid payment claim?
Lachlan Page is a Solicitor at Mullane & Lindsay and is part of our Commercial, Property & Estates Law team.
As discussed in my earlier article “Security of Payments Act – How it can Help You!”, using the Building & Construction Industry Security of Payments Act 1999 NSW (‘the SOP Act“) has significant benefits.
However, before you can access the many benefits of the SOP Act you must ensure that you are serving what is known as a Valid Payment Claim. A Valid Payment Claim is essentially an invoice for payment that contains a number of distinguishing characteristics. These are:
- It must adequately identify the construction works to which the claim for payment relates,
- It must indicated the claimed amount,
- It must be issued on or after a Reference Date,
- It must only relate to works performed before the relevant Reference Date.
- It must be served within the later of any period specified in the Construction Contract or within 12 months of when the construction works were last carried out.
Security of Payments Act – How can it help you?
by Lachlan Page
Lachlan Page is a Solicitor at Mullane & Lindsay and is part of our Commercial, Property & Estates Law team.
If your business provides goods or services in the Building & Construction Industry and you are not aware of the Building & Construction Industry Security of Payments Act 1999 NSW (‘the SOP Act“), you could be missing out!
The SOP Act provides an unparalleled regime that can either be very beneficial or extremely brutal depending on your understanding of the SOP Act and how you utilise its provisions. It is designed to increase cash flow within the building and construction industry and, if utilised correctly, can drastically minimise lengthy disputes and increase your ability to recover monies owed. Read the rest of this entry »
Court costs – when do they not “follow the event”?
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and specialises in commercial dispute resolution & litigation, and employment law.
Most of us are familiar with the expression “costs follow the event”; that is, in a litigated claim the loser usually is ordered to pay the winner’s costs. In some circumstances that rule can be varied. The NSW Civil and Administrative Tribunal (NCAT) recently dealt with an application to vary, based on two specific grounds.
A dentist was charged with, but acquitted of (under mental health legislation) indecent assaults against a patient. However the same facts resulted in disciplinary proceedings against him by the Health Care Complaints Commission. There was a finding of professional misconduct; and a declaration that, had the dentist not otherwise ceased to be registered, his registration would have been cancelled for a period of 18 months. The HCCC had sought a cancellation for 2 – 3 years. Read the rest of this entry »
What is the difference between a business name and a company name?
by Lachlan Page
Lachlan Page is a Solicitor at Mullane & Lindsay and is part of our Commercial, Property & Estates Law team.
Although a relatively simple concept, the difference between a Business Name and a Company Name is not well understood.
The most important differentiating characteristic between a Business Name and a Company is that a Company is a separate legal entity and a Business Name is not. This means that a Company is, for all intents and purposes, treated like a human being in that it is able to enter into agreements or transactions in its own right. Read the rest of this entry »
Have you considered the risks involved in loaning money to family members?
by Lachlan Page
Lachlan Page is a Solicitor at Mullane & Lindsay and is part of our Commercial, Property & Estates Law team.
It is common for people to loan sizable sums of money to family members from time to time. Whether it be a loan to help a family member out of a financial crisis, for the deposit on a new home or to start up a new business.
If you are in the fortunate position to be able to loan money to a family member, you should still approach the issue from a sensible and prudent standpoint. Any loan of a sizable nature should be documented appropriately in a Loan Agreement. Read the rest of this entry »
Preliminary discovery – How do you find out if you have a claim?
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and specialises in commercial dispute resolution & litigation, and employment law.
People sometimes suspect they have legal rights but just aren’t sure – and the only documents that may help them decide, are held by the prospective defendant. Many Courts allow for “preliminary discovery”, that is, for orders requiring a potential (not actual) defendant to produce documents and records to help the potential plaintiff work out whether they have a case or not. However it is not an easy process. To obtain preliminary discovery an applicant must show, amongst other things, that it was ‘otherwise unable’ to obtain sufficient information to decide whether or not to sue
An insurer (RealCover) sold policies through a broker (Gallagher). RealCover provided Gallagher with information such as client lists and renewal dates to facilitate that process. The agency arrangement came to an end early in 2015 and RealCover appointed a new broker; however it suffered a sharp decline in its business. It suspected Gallagher may have been using its confidential information to “target” RealCover customers. Gallagher denied this was the case and said that it contacted potential customers on the basis of other (non – confidential) information in its possession. Read the rest of this entry »
Why not cap your warranties?
by Lachlan Page
Lachlan Page is a Solicitor at Mullane & Lindsay and is part of our Commercial, Property & Estates Law team.
We all know that warranties play a significant part of negotiating sale transactions.
The usual dance involves the Purchaser seeking extensive warranties and the Vendor resisting with the end result somewhere in between.
There are a couple of techniques that may assist a Vendor/Vendor’s Solicitor in negotiating warranties that are not too onerous on the Vendor without derailing the transaction altogether. Read the rest of this entry »
Agency agreements and contractual traps
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and specialises in commercial dispute resolution & litigation, and employment law.
Mentmore Pty Ltd wanted to import some goods. It obtained finance from a lender, Moneytech Services Pty Ltd to do so. Moneytech was named as the purchaser of the goods, pending payment by Mentmore. Under specific provisions of The Customs Act an ‘owner’ of goods can appoint a customs agent to act for him. “Owner” is defined to include someone claiming an interest in the goods. Technically, in these circumstances, Moneytech was an ‘owner’; and it appointed Megatop as its customs agent to receive the import. Read the rest of this entry »
Buying a Business? Beware the GST Trap!
by Lachlan Page
Lachlan Page is a Solicitor at Mullane & Lindsay and is part of our Commercial, Property & Estates Law team.
When purchasing a business in Australia you are usually able to take advantage of a GST exemption under the A New Tax System (Goods and Services Tax) Act 1999 (‘the GST Act‘).
The exemption is known as the ‘sale of a going concern’ exemption. In order to satisfy the sale of a going concern exemption the Purchaser ‘must receive all of the things that are necessary for the continued operation of the enterprise [business].’ Read the rest of this entry »
Traps with electronic signatures
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and specialises in commercial dispute resolution & litigation, and employment law.
Late in 2015 the NSW Supreme Court heard a dispute relating to a personal guarantee of a credit account, apparently signed with an electronic signature.
A building company (IDH) had a credit account with a building supplies company (Williams). IDH had an internal system allowing directors to attach signatures electronically to documents. Williams required personal guarantees from directors of building companies such as IDH. The case related to whether one of three directors, a Mr Crocker, had in fact attached his electronic signature to the personal guarantee, or authorised someone else to do so (or whether he had later ‘ratified’ the guarantee, even if he did not initially sign it). Read the rest of this entry »
Can you redact or obscure documents produced on subpoena?
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and specialises in commercial dispute resolution & litigation, and employment law.
The Western Australian Supreme Court recently dealt with a subpoena dispute. The case was about a building contract under which a builder was contractually obliged to insure the structure being built. A storm damaged the structure; and the plaintiff owner alleged that the builder had breached its obligation to arrange adequate insurance, with the result that the owner of the structure suffered a loss.
An issue in dispute was whether or not the builder had taken adequate insurance. A subpoena was issued for the builder’s policy document. It was produced by the insurer, both in full and as a partly redacted or obscured document. There was no objection to an inspection of the redacted document but there was an objection to reading the policy document “in full”. The objection was on the basis that the policy contained commercially sensitive and irrelevant (to the dispute) information. Read the rest of this entry »