We have a new website and new Blog format!- Dont miss out on new blogs

We have a new website and new Blog format!

Visit our new and improved website at www.tlfc.com.au. It is more user friendly, sets out the services we provide clients and has useful information for clients and potential clients. You can also view the entire contents of our website (and blog) in Chinese (both simplified and traditional). For a list of our services click here (for an English version) and click here (for a Chinese version).

Don’t miss out on our blog- Have you signed up to our new site?

Our website now also integrates our Business and Property Law Blog. We post regular items of interest for those in business and property (including owners, tenants, estate agents, owners corporations and developers). Its complimentary and quick to subscribe to. Just enter your email address and click on Subscribe in the Blog section of our website.

If you were signed up to this blog and have recieved our new format Blog (sent on 20 January 2015) then you are already signed up and no need to do anything. If you missed our blog on 20 January 2015 then you will need to sign up again on our new site Blog section .

Regards

Phillip Leaman

Tisher Liner FC Law Pty Ltd

www.tlfc.com.au

Real Estate Contract changes in depth analysis

Further to our previous posts on this topic we include below a paper presented by Ron Cohen with a more a detailed analysis on the changes to the sale of land act which are important for vendors and estate agents to comply with.

The Sale of Land Amendment at 2014 (“Amendment Act”) came into effect on 1 October 2014.

1. The main purpose of the Amendment Act is to “re-enact, reform and modernise” Vendor Statements provided under Section 32 of the Sale of Land Act and to make consequential amendments to other relevant legislation.

This has resulted in a new form of Section 32 Statement (Vendor Statement) being used on and from that date.

2. The Amendment Act also introduces a new requirement for Vendors (or their real estate agent) to provide a Due Diligence Checklist to prospective purchasers of residential land from the time that the land is offered for sale.

3.There is also a new form of Contract of Sale of Real Estate prescribed by the Estate Agents (Contracts) Regulations 2008 (“Regulations”) which updates the previous prescribed version.

This paper is intended to briefly highlight these updates and how they may affect real estate agents in particular, including some suggested action points.

Also, just a quick note to advise that whilst the Amendment Act and the new form of Section 32 Statement commenced on 1 October, there are transitional provisions which allow an old form of Vendor’s Statement to be used in certain circumstances, namely where:

1. The relevant property was “on the market” for sale prior to 1 October; and

2. An old form of Vendor’s Statement was prepared and signed prior to that date.

However, it is suggested that where possible the new form of Section 32 Statement should be used even during the transitional period.

NEW FORM OF VENDOR (SECTION 32) STATEMENT

By virtue of the changes brought about by the Amendment Act, a new format of statements under Section 32 of the Sale of Land Act has been developed, as well as a range of changes to the information and documentation attached to the Statement.

This paper does not propose to detail all of these changes but will highlight some important features in the new document.

These changes include the following:

1. The new format of the Statement requires the names and signatures of both the Vendor and the Purchaser (as well as the date of signing) on the first page rather than at the end of the Statement. (The Amendment Act also allows the Vendor to sign the Statement by “electronic signature” but does not specify what constitutes an electronic signature).

2. It requires a search statement (i.e. a title search) to be included rather than a mere photocopy of the duplicate Certificate of Title.

3. It only needs to disclose services that are not connected to the property.

4. It only requires relevant information regarding any Owners Corporation affecting the land to be included and an Owners Corporation Certificate is no longer mandatory. (However, I am of the view that it is still prudent to attach an Owners Corporation Certificate where possible).

BUT NOTE – in the event that the Owners Corporation is inactive (and this includes a situation where the Owners Corporation has not within the last 15 months held an annual general meeting, fixed any fees and not held any insurance) no Certificate or information is required. The Vendor Statement simply needs to disclose that the Owners Corporation is inactive.

5. For an Off-The-Plan sale the latest version of the Plan of Subdivision must be attached.

6. Only notices, orders, declarations, reports or recommendations that “directly and currently” affect the land which the Vendor is expected to have knowledge of need to be included.

7. The Section 32 Statement no longer needs to be attached to the Contract.

8. An Additional Vendors Statement is required when the land is sold subject to a mortgage or under a terms contract.

9. Only one counterpart of the Section 32 Statement is required.

Failing to use the new form of Section 32 Statement from 1 October may entitle a Purchaser to exercise rights to rescind the Contract prior to settlement.

DUE DILIGENCE CHECKLIST

The Amendment Act now makes it a requirement for a Vendor (or a licenced estate agent appointed by the Vendor) offering vacant residential land and/or land with an existing residence for sale to make available to all prospective purchasers a Due Diligence Checklist (“Checklist”) from the time that the land is offered for sale.

Note that the “vacant residential land” is very broadly defined to include any vacant land on which the construction of a residence is permitted.

The Checklist must be in a form approved by the Director of Consumer Affairs Victoria. Consumer Affairs has already developed a form of Checklist which is available on its website (www.consumer.vic.gov.au/duediligencechecklist) and a copy is provided with this paper.

The Checklist contains information similar to the warnings appearing on the previous form of Vendor’s Statement as well as a variety of information that a Purchaser should consider and investigate when buying a residential property.

The Amendment Act specifically provides that where the Vendor has appointed a licenced real estate agent, the obligation to provide the Checklist falls on the agent rather than the Vendor.

Failure to provide the Checklist may incur a liability to a fine of up to 60 penalty units (currently, $8,856.60).

However, the Amendment Act does not appear to give the Purchaser any rights if the Checklist is not provided.

So, how is the Checklist made available? The Amendment Act provides that it is to be made available if:

(a) Copies of the Checklist are on display or offered to prospective Purchasers at an open for inspection; and

(b) If it is available (either directly or by a link) on any internet website maintained by the Vendor or the Vendor’s estate agent.

NEW FORM OF CONTRACT

With the new form of Section 32 Statement also comes a new form of Contract of Sale of Real Estate (published jointly by the Law Institute and Real Estate Institute of Victoria).

The form is substantially the same as the previous form but there are a few amendments and updates which agents should familiarise themselves with.

Agents should be aware that Section 53A of the Estate Agents Act allows them to fill in a standard form of Contract prescribed by the Regulations, and also to fill in a Contract prepared a legal practitioner or licensed conveyancer.

CONCLUSION/ACTION PLAN

So now that you are aware of these significant changes in the law, what should you do?

I would recommend some or all of the following:

1. Review your existing listings which commenced prior to 1 October. If the Section 32 Statement is in the old form, check whether it has it been signed by the Vendor prior to 1October.

Regardless of whether or not it has been signed, you should confirm with the Vendor’s Solicitor whether an updated Section 32 Statement is required. (My recommendation is to use a new form of Section 32 Statement wherever possible).

2. Ensure that the new form of Section 32 Statement is used for any listing commencing from 1 October.

3. In most cases ensure that the Vendor’s legal practitioner prepares the Contract of Sale.

4. If you, as selling agent, are required to prepare the Contract, you should only use the form prescribed by the Regulations.

5. Where only one Section 32 Statement is available, obtain written confirmation from the Purchaser that a signed Section 32 Statement was given prior to the Contract being signed (and if possible photocopy the Statement after it has been countersigned and dated).

6. For residential sales, make sure that you make the Checklist available both at open for inspections and on your website. I would also recommend that when you send property information to prospective Purchasers for example by way of an information memorandum, tender process, brochure or email, you should include the Checklist (or a link) as part of these materials.

7.Keep a written record of how and when you made the Checklist available for each of your residential listings.

For assistance on property law matters speak to Ron Cohen, Jonathan Tisher, Frank Tisher or one of Tisher Liner FC Law’s property law team. See our website www.tlfc.com.au for further details on the services we provide clients.

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: info@tlfc.com.au

Web: www.tlfc.com.au

NOTICE: This blog is for information purposes only and the material appearing on this blog is not intended to be nor should it be relied on as legal advice or a substitute for legal or other professional advice.

Purchasing real estate by an SMSF and the implications from an Estate Planning perspective

Self-managed superannuation funds (“SMSF”) are becoming a common vehicle to invest in real estate particularly for residential real estate. The income of an SMSF is taxed at the rate of 15% however any income derived by the SMSF whereby it qualifies to be in pension phase is exempt from income tax altogether. In addition to income tax benefits, there are also capital gains tax benefits in using an SMSF to purchase real estate whereby capital gains tax is at a maximum rate of 15% and once the SMSF reaches the pension phase, there will be no capital gains tax payable.

There are therefore compelling reasons to consider using an SMSF for the purchase of real estate but the advantages and disadvantages must be carefully considered.

To purchase real estate in a SMSF, the SMSF either has to have all the funds available for the purchase price, or if it wishes to borrow funds, there are very strict guidelines for such borrowings. These must be considered before a Contract of Sale & Vendor’s Statement is signed.

Borrowing by an SMSF requires that the real estate is purchased by a separate entity and such entity must enter into an agreement to hold the property as bare trustee for the SMSF. It is the separate entity that borrows for the purpose of purchasing the real estate. It is a specific requirement that the security for the borrowing is to be limited to the single asset being acquired and that no other assets of the SMSF can be placed at risk (this is called a limited-recourse loan). The bank may also require a personal guarantee to be provided. The loan is different to the usual loan that a bank will provide.

It is important to note that once the SMSF has purchased the property, it cannot change the nature of the property and cannot borrow further funds for this purpose. In addition, if an SMSF purchases residential real estate, such property cannot be lived in by a member of the family. It is also important to be aware of what the SMSF can do so that there are no breaches. Any breaches may results in the SMSF becoming non compliant and its assets being taxed at a much higher rate (up to 46.5%).

One must also be aware that there are additional expenses in establishing the SMSF and the structure for the purpose of borrowing. These should also be considered before proceeding to purchase.

From an estate planning perspective, the advantages are similar to any other asset acquired by the SMSF and dealt with in accordance with the appropriate regulations and the provisions of the trust deed.

It is important to note that assets which form part of an SMSF are not dealt with by your Will and that any assets in the SMSF must be specifically dealt with in accordance with the appropriate legislation and the provisions of the trust deed governing the distribution of any assets of the SMSF.

It is common to prepare a binding death nomination in respect to such distribution and this must be carefully considered at the same time that the Will is made taking into account any trusts or entities which are owned or controlled by the Will maker. The nomination will usually nominate a specific person or entity who will be entitled to the assets of the superannuation fund. This all forms part of estate planning discussions.

Tisher Liner FC Law has expertise and experience in all the matters referred to in this article. Please contact Jonathan Tisher, Ron Cohen, Dennis Liner or one of Tisher Liner FC Law’s property law team if you have any specific queries.

See our website http://www.tlfc.com.au for further details on the services we provide clients.

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: info@tlfc.com.au

Web: http://www.tlfc.com.au

Contract of sale of real estate- SPECIAL CONDITIONS

Regardless of what type of property you are acquiring, in Victoria every agreement for the purchase and sale of property must be in writing. It is usually in the form of a Contract of Sale of Real Estate approved by the Law Institute and Real Estate Institute of Victoria. The contract will contain general conditions and in many cases a Vendor’s lawyer will also add their own special conditions.

However, Purchasers can also request special conditions be included in the contract.

These may include:

Subject to a satisfactory building and pest inspection report;
Subject to planning or building or building approval if the investor wants to renovate or develop the property;
Early access (e.g. for the Purchaser’s surveyor to measure the property or carry out soil tests);
A due diligence period to conduct a detailed analysis of the property, and
The Vendor to provide a depreciation schedule in the case of a new property.

Special conditions for the benefit of a Purchaser are designed to protect Purchasers and to lock in a price whilst still conducting due diligence and these conditions will give a Purchaser an “out” if any of the agreed conditions are not satisfied, while still binding the Vendor if ultimately the Purchaser wants to proceed. It also ensure the property comes off the market.

Whether you are selling or purchasing a property it is important to make sure the contract is drafted properly and deals with the relevant issues. It should always be checked by a property lawyer before it is signed.

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: info@tlfc.com.au

Web: www.tlfc.com.au

Are you a lender of funds? Get your systems in place now to avoid an issue

On 24 September 2014 new laws took effect to require mortgagees to take reasonable steps to verify the identity and authority of a borrower under a mortgage. The Transfer of Land Act 1958 has been amended to impose strict obligations upon lenders.

What do lenders need to do?

They need to properly identify borrowers and it is suggested they follow the standards set out in the Electronic Conveyancing National Law (Victoria).
If a fraud is perpetrated then the mortgage will be void and the security will be lost.

The new law applies to institutional lenders and private lenders.
Tisher Liner FC Law have experience in loans and finance matters. For assistance speak to Phillip Leaman, Michael Fetter or Felicity Simpson.

Phillip Leaman | Principal | Accredited Business Law Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: pleaman@tlfc.com.au

Web: www.tlfc.com.au

Liability limited by a Scheme approved under Professional Standards Legislation

Domain names- I own the rights don’t I?

How secure is your Domain Name?

If you have a Domain Name with “.com.au” then you do not “own” it. 　You only have the licence to use it for a period of two years.

Accordingly, it is important that you diarise the expiry date in order that you ensure that your domain name is　reregistered prior to the expiration of the two year period.

In a recent decision by the Panel in respect to a Domain Name dispute,　the holder of the Domain Name was not aware that the appropriate Registrar had gone into liquidation and subsequently without the holder being aware, the two year period expired and the Domain Name lapsed. 　Unfortunately for such holder,　another organisation subsequently registered the identical Domain Name for its benefit.

This matter came before the Domain Name Dispute Administrative Panel 　and it was dealt with in accordance with the “au Dispute Resolution Policy”.

Such Policy sets out that if the Domain Name is identical or similar to names or Trade Marks, the person holding the Domain Name has no rights or legitimate interests in respect to such Domain Name and　if it was registered or it was being used in bad faith, then the Panel has the jurisdiction to order that the Domain Name be transferred back to the previous holder.

In the relevant determination, the Panel found that although the name was identical to a Trade Mark, the other two criteria were not proven. Accordingly, the Panelist dismissed the claim.

The relevant Policy provides for “first come, first served” and in order to challenge the registration of the use and registration of the Domain Name, the above three elements mentioned above, have to be satisfied.

Tisher Liner FC Law have the expertise in respect to Domain Name disputes and Dennis Liner has acted as the Panel in many disputes.

Tisher Liner FC Law have the experience to handle simple to complex domain name disputes.

Dennis Liner

Senior Consultant

TISHER LINER FC LAW

Level 2,　333 Queen Street, Melbourne VIC 3000　| DX 181 Melbourne

Ph:　+61 3 8600 9333　| Fax:　+61 3 9670 6359　| Email:　dliner@tlfc.com.au

Web:　www.tlfc.com.au

Liability limited by a scheme approved under Professional Standards Legislation.

Legal Update- Section 32 Statements, Penalty Interest Rates and East West Link

Section 32 Statements- Checklist now available- Agents and Vendors get ready for 1 October 2014

Recent changes to the Sale of Land Act which were outlined in our blog http://blog.tlfc.com.au/2014/07/22/sellers-and-agents-beware-comply-with-new-section-32-statement-requirements-or-pay-the-penalty/ which require vendors and their agents to provide a due diligence checklist to purchasers and prospective purchasers from 1 October 2014. Vendors must also use the new format of the Section 32 statement from this date.

Vendors and agents must ensure copies of the due diligence checklist are available to potential buyers at any open for inspection and include a link to the Consumer Affairs webpage (http://consumer.vic.gov.au/duediligencechecklist) or include a copy on any website maintained by the estate agent or the seller (if no estate agent is acting for the seller) from 1 October 2014.

Penalty Interest Rate Changes

Most leases and commercial documents provide that the interest rate payable (particularly the default interest rate) is referenced to the amount prescribed by Section 2 of the Penalty Interest Rates Act 1983 (Vic). Please note that the Department of Justice has decreased the penalty interest rate from 11.5% per annum to 10.5% per annum as at 11 August 2014. The last rate change was in February 2014.

East West Link

The process of acquisition of properties for the East West Link is underway with our clients already receiving a Notice of Intention to Acquire. Formal acquisition via a Notice of Acquisition is due to be provided to land owners and tenants in early October 2014. Any party who has not received legal advice as yet and has received a Notice of Intention to Acquire should obtain legal advice now and start preparing to respond to compensation offered by Linking Melbourne Authority. Tisher Liner FC Law have experience in compulsory acquisition matters and act for affected landowners who will be losing their land to the Authority for the East West Link.

Our website http://tlfc.com.au/public/compulsory-acquisition has some useful information for those affected including frequently asked questions and a summary of the process. Contact Phillip Leaman for assistance.

Phillip Leaman | Partner | Accredited Business Law Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: pleaman@tlfc.com.au

Web: www.tlfc.com.au

Liability limited by a Scheme approved under Professional Standards Legislation

Developers and Owners Corporation Managers in the Spotlight- Proposed Law Change

Owners Corporation Proposed Law Change Alert

Developers and Owners Corporation Managers in the Spotlight in Proposed Changes to Owners Corporation Legislation

Changes to the laws that govern owners corporations in Victoria are currently being considered in the form of the Consumer Affairs Legislation Further Amendment Bill 2014. The proposed changes will have significant implications for developers and owners corporation managers across Victoria. A brief summary of some of the proposed changes is below:

Extending the statutory obligation on developers with majority voting entitlements to act honestly, in good faith and with due care and diligence in the interests of the Owners Corporation whilst exercising rights and functions under the Owners Corporations Act 2006 from 5 years to 10 years.
Imposing restrictions on management contracts including:
3-year maximum term (subject to regulations);
Prohibitions on restricting owners corporation’s available methods for revoking manager’s appointment; and
Contractual roll-over periods only to be on a monthly basis or shorter.
Imposing express obligations on managers to obtain goods and services at competitive prices and on competitive terms and to make express written disclosure of certain beneficial relationships with suppliers that the manager is aware of.
Imposing obligations on managers to keep separate bank accounts for trust monies held on behalf of separate owners corporations and giving owners corporations the right to request bank statements for such accounts for up to three years (exemptions may apply).
Imposing obligations on managers to report to owners corporations on professional indemnity insurance, receipts and disbursements of trust monies, commissions, payments or other benefits received by the manager in relation to contracts for goods and services supplied to the owners corporation.
Clarifying that VCAT has the power to determine disputes regarding management contracts.
Restricting who can become or remain an owners corporation manager.

Tisher Liner FC Law has a dedicated Owners Corporation Law division committed to providing quality legal advice and representation to Owners Corporations, Committees, Lot Owners and Managers.

Our team will seek to keep you up to date on when the above proposed new changes (or any above proposed new changes (or any amendment made in the meantime) come into effect.

Nicole Wilde | Lawyer

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: nicolewilde@tlfc.com.au

Web: www.tlfc.com.au

Liability limited by a scheme approved under Professional Standards Legislation.

Developers Beware- The ATO may be after you

The Australian Taxation Office has issued a Tax Payer Alert (TP2014/1) which deals with how property developers structure their development, particularly when they use trusts to return the proceeds as capital gains instead of income on revenue account.

Some Developers treat the proceeds on capital account to access the general 50% capital gains tax discount. The ATO has stated that it considers some arrangements to have the following taxation issues and treatments:

“(a) the underlying property constitutes trading stock for the purposes of section 70-10 of the ITAA 1997 on the basis that the trustee is carrying on a business of property development,

(b) the gross proceeds from sale constitute ordinary income under section 6-5 of the ITAA 1997 on the basis that the trustee is carrying on a business of property development,

(c) the net profit from sale is ordinary income under section 6-5 of the ITAA 1997 on the basis that, although the trustee is not carrying on a business of property development, it is nevertheless involved in a profit making undertaking.”

It is important that developers put in place an appropriate structure which works for them now and in the future. Developers must also ensure that the activities they undertake (i.e. in relation to obtaining finance, marketing and attempting to sell the property etc) is not at odds with their taxation treatment of the proceeds of sale. Otherwise, adverse taxation consequences (such as the imposition of additional tax, penalties up to 75% and interest) could result. The ATO has indicated that developers are on their hit list and audits are and will be occurring.

Tisher Liner FC Law have substantial experience in property development matters acting for developers and we can work together with a developer’s accountant and taxation adviser to put appropriate documentation in place to deal with the proposed purpose and ultimate taxation treatment.

For property development matters, please contact Phillip Leaman, Jonathan Tisher, Michael Fetter, Ron Cohen, Frank Tisher or Alan Goldstone to discuss your needs.

Phillip Leaman | Partner | Accredited Business Law Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: pleaman@tlfc.com.au

Web: www.tlfc.com.au

Have you subscribed to our complimentary Business and Property Law Blog?

Sign up now at: http://blog.tlfc.com.au/

Liability limited by a scheme approved under Professional Standards Legislation.

Sellers and Agents Beware- Comply with new Section 32 statement requirements or pay the penalty

Section 32 of the Sale of Land Act 1962 (Vic) provides that a vendor must give a purchaser a statement containing particular matters concerning a property to be sold.

The Victorian Parliament has recently amended Section 32 of the Sale of Land Act 1962 (Vic) placing additional obligations on vendors and estate agents. The section is due to commence on 1 October 2014, but this date is subject to confirmation to proclamation. In any event the date must be no later than 1 July 2015.

Some of the changes you need to know as a vendor or estate agent:

All Section 32 statements (Vendor’s Statements) need to be updated and the correct format (with all required information) to be used from the commencement date;
Section 32 statements will no longer be required to be attached to the contract of sale;
Details of planning overlays affecting the land will need to be included;
Non-connected services must be disclosed;
Notices or orders affecting the land must be disclosed;
A register search statement must be attached (rather than a copy of the certificate of title);
Owners Corporation Certificates may not be required when certain prescribed information is provided instead;
A new Due Diligence Checklist needs to be provided to purchasers from the time the real estate is offered for sale. This obligation will fall on an estate agent if one is appointed. Failure to provide the checklist may result in a fine of up to 60 penalty units. However purchasers will have no right to rescind a contract of sale if a checklist was not provided. Consumer Affairs has yet to release the final version of the checklist;
If a Vendor’s Statement is provided and signed before the commencement date, a new Vendor’s Statement may not need to be provided unless the property is taken off the market and then put back on the market.

Estate agents should ensure that the new Due Diligence Checklist is available at opens for inspection and available via the agent’s website.

It is important that you ensure your solicitor knows of the changes and provides you with a Section 32 Statement which complies once the Act and relevant sections becomes operational. There is no substitute for quality legal service when selling or buying a property.

Tisher Liner FC Law have been assisting vendors and purchasers for over 40 years and have an experienced property law team, including 2 Accredited Property Law Specialists, Frank Tisher and Jonathan Tisher. Visit our website www.tlfc.com.au for details on our services and our team.

Phillip Leaman | Partner | Accredited Business Law Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: pleaman@tlfc.com.au

Web: www.tlfc.com.au

Have you subscribed to our complimentary Business and Property Law Blog?

Sign up now at: http://blog.tlfc.com.au/

East West Link approved- Compulsory acquisition to begin

The Minister of Planning Matthew Guy has approved the initial stage of the East West Link subject to Linking Melbourne Authority preparing some additional plans to satisfy VicRoads requirements and to establish a process for providing regular information to owners in areas where design refinement is occurring.

We understand that formal Notices of Acquisition could be provided by Linking Melbourne Authority to some owners within the next two weeks.

It is integral that land owners and occupiers obtain legal advice and valuation evidence to ensure that they properly assess any initial offers received from Linking Melbourne Authority. Under the Land Acquisition and Compensation Act 1986, those affected are entitled to payment of their reasonable legal and valuation costs. Those affected may also be entitled to an additional amount of up to 10% of the market value under the principles of solatium. It is important to get advice from an experienced compulsory acquisition lawyer to ensure maximum compensation is obtained.

Tisher Liner FC Law have experience in compulsory acquisition matters and dealing with Linking Melbourne Authority.

Our firm assisted 50 clients in the Evo development in obtaining excellent results and are currently advising clients in the initial stage of the East West Link.

Once an affected party receives a Notice of Acquisition they have 3 months to obtain legal and valuation advice. Whilst this sounds like a long time, it goes fast and clients need to be ready now.

For a summary of compulsory acquisition see our compulsory acquisition East West Link information page and our compulsory acquisition FAQ page.

For advice and assistance contact Phillip Leaman on 03 8600 9333 or by email: pleaman@tlfc.com.au

Phillip Leaman | Partner | Accredited Business Law Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: pleaman@tlfc.com.au

Web: www.tlfc.com.au

Have you subscribed to our complimentary Business and Property Law Blog?

Sign up now at: http://blog.tlfc.com.au/

HAPPY NEW FINANCIAL YEAR & TISHER LINER FC LAW HAS A NEW PARTNER & ASSOCIATE

Tisher Liner FC Law wishes its clients a Happy New Financial Year. Now is the time to get your business in order. Check out previous posts at http://blog.tlfc.com.au for various topics which may be of interest. Click on the “Business Law Blog Entries” and “Property Law Blog Entries” links at the top of the website to see a list of our posts in each area.

Tisher Liner FC Law is pleased to announce the appointment of Phillip Leaman as a Partner of the firm and the promotion of Caroline Inglis as an Associate.

Phillip is an Accredited Business Law Specialist and a highly versatile and efficient commercial lawyer with excellent drafting and negotiating skills. Phillip provides commercially focused legal advice to his clients and handles all business/commercial law matters for clients including the preparation of agreements and advice on general commercial matters, business structuring, trusts and company law, sales and purchases of businesses, joint ventures, shareholder and unitholder agreements, partnerships, leasing, Personal Property Securities Act matters, insolvency matters, intellectual property law, employment law, planning matters, general property law matters and franchising. Phillip also conducts commercial and property litigation matters for his clients in both State and Federal jurisdictions. He has also been involved in numerous adverse possession and compulsory acquisition claims and has an extensive expertise in these areas of law. Phillip acted for the successful party in the leading adverse possession case Abbatangelo v Whittlesea City Council and is co-author of the Law Institute of Victoria cover story “What’s yours is mine, adverse possession in Victoria”.

Caroline is a commercial and property lawyer who handles large and complex property transactions. She has very strong drafting skills and is commercially focused in her dealing with clients. Caroline advises clients with commercial and retail leasing matters including drafting lease documents, negotiating leases and advising on retail lease issues and disputes. She also works on a range of commercial matters including advising and preparation of loan documents, sale and purchase of property, joint ventures, unitholder and shareholder agreements. Caroline also advises clients in relation to Personal Property Securities Act matters, planning matters and general property law matters such as easements, removal of covenants

The firm congratulates Phillip and Caroline on their promotions.

Tisher Liner FC Law

Business Property Litigation

Serving clients with a high level of legal service for over 40 years

www.tlfc.com.au

Competitions- Do I need a permit?

Your marketing department has come up with a great marketing idea. Lets run a competition. But what about the legal stuff?

Depending on the nature and size of the competition will depend on whether or not you need a permit. Each state in Australia has different rules and permit requirements. A competition which runs across Australia is likely to require permits in each state.

Where the competition relies solely on skill (with no element of chance) then a permit may not be required.

In Victoria, a trade promotion lottery is a lottery which promotes a business by giving away prizes where there is an element of chance. Trade promotion lotteries require a permit if the retail price of the prize pool is greater than $5,000. If your prize pool is less than $5,000 and it is a trade promotion lottery, you still must abide by the obligations set out by the Victorian Commission for Gambling and Liquor Regulation.

So what’s involved with getting a permit in Victoria?

You need to prepare suitable competition terms which deal with, amongst other items, how the competition is run, who can enter, how the draw takes place and what happens if the prize is not collected;
Make an application to the Victorian Commission for Gambling and Liquor Regulationfor a permit; and
Comply with the Gambling regulation Act 2003.

There are additional requirements for certain prizes such as cars, travel and accommodation, jewellery, house and land, motor vehicles, machinery and electrical appliances.

Irrespective of whether a permit is required, you must also be careful that any advertising of the competition is not contrary to the Competition and Consumer Act 2010 (formerly the Trade Practices Act) (for example, you cannot engage in misleading or deceptive conduct).

If you plan on using a 1900 number or SMS the telephone call or SMS cannot cost more than 70 cents per entry (including GST).

Entry fees cannot be charged for trade promotion lotteries but you can make purchasing a product or service as a condition of entry.

For advice and assistance relating to competitions and trading terms, please contact Phillip Leaman or Jonathan Tisher of Tisher Liner FC Law who have experience in competition and trading term matters.

Phillip Leaman | Senior Associate | Accredited Business Law Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: pleaman@tlfc.com.au

Web: http://www.tlfc.com.au

Purchasing “off the plan”

Purchasing “off the plan”

In Victoria, there are a number of advantages in purchasing property “off the plan” before construction has commenced.  

There is often a significant saving on stamp duty, where you only pay a fraction of the full stamp duty otherwise payable.
Upon signing the contract you can elect to pay the 10% deposit in cash (as opposed to a bank guarantee), which should then be invested in an interest bearing account by the Vendor’s Solicitors. Therefore, you can accumulate interest on your deposit if the condition allows for this.
Paying the balance of the purchase price after construction is completed also allows more time to get your finances in order.
You may be able to choose from different internal colour schemes, quality finishes, and upgrades on fixtures and fittings.
You will end up with a new apartment or lot; and
You can obtain a depreciation schedule which is beneficial from a tax perspective.

However, when buying “off the plan”, it is essential that purchasers have an eye for detail, understand the impact of changes made to the plan of subdivision and are kept well informed of any amendments to their lot or the plan in general.

Before signing a contract and committing funds, it is imperative that purchasers do research on the proposed property and the builder and seek professional advice.

Once the contract is signed, it is difficult to amend provisions – so get it right before you sign! With any property transaction you should seek the professional advice of the highly skilled property team here at Tisher Liner FC Law.

Elena Komis | Law Graduate

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: ekomis@tlfc.com.au

Web: http://www.tlfc.com.au

Five tips to reduce your legal costs in dispute matters

Tisher Liner FC Law are mindful of costs for clients and we take a proactive commercial approach to matters to see if a commercial resolution can be achieved.

Whilst sometimes issuing legal proceedings in Court is inevitable and unavoidable, mediation or an informal round table discussion should be explored in the first instance in most cases. See our previous blog on mediation for the benefits of mediation and alternative dispute resolution at http://blog.tlfc.com.au/2014/05/02/why-mediate/

So here are our top 5 tips to reduce your bill from us in litigation matters:

When briefing us on your matter provide us with a full set of all documents concerning the dispute in a folder in chronological order. It is important that we see all documents at the start.
Write down what your ultimate goal/resolution is. This goal may change depending on the advice you are provided and the relevant strengths of your claim but it is important to have an idea of what it is you are after from the start. Try and work out your goal from a commercial perspective rather than from an emotional perspective.
Work out what your budget is for legal costs. Are you trying to obtain the best outcome you can on a certain budget or do you want to attempt to achieve the outcome you want no matter the cost?
Attend a mediation early and with an open commercial mind. Settling a matter early may avoid a costly and lengthy legal battle.
Seek legal advice early. Clients who delay or let matters develop without attending to them end up with costs larger than if the matter was dealt with straight away.

Whether you are working to a budget or want to pursue a party no matter the cost, Tisher Liner FC Law are here to assist you. For assistance in disputes and litigation please contact Phillip Leaman, Sam Recht or Simon Abraham or one of the Tisher Liner FC Law litigation team.

Phillip Leaman | Senior Associate | Accredited Business Law Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: pleaman@tlfc.com.au

Web: http://www.tlfc.com.au

Case law update- Owners Corporations and Short Stay Businesses

OWNERS CORPORATION FIGHTS BACK AGAINST SHORT-STAYS – VCAT ORDERS END TO SHORT-STAYS IN SOUTHBANK BUILDING

Tisher Liner FC Law acted for the owners corporation of a residential apartment complex in Southbank which has successfully obtained Victorian Civil and Administrative Tribunal (“VCAT”) orders confirming a short-stay business operating in their building was in breach of their owners corporation’s rules and must cease. VCAT has confirmed that short-term stays and serviced apartments breach owners corporation rules which prohibit the use of residential apartments for any business. The orders are the first of their kind and may prompt other owners corporations to take similar action.

The VCAT orders come at a time when tensions between residential owners corporations and short-term stay operators are high and the legal powers of the Local Councils to intervene to stop short-term stays are currently unresolved. The Watergate short-term stay case in 2013 involving the City of Melbourne’s powers to stop short-term stays in residential buildings by issuing building orders has been sent back to the Building Appeals Board for re-hearing. The City of Melbourne has made its opposition to short-term stays in residential apartments clear. However, the case may take many more months to resolve and may not achieve the desired result.

Owners corporations should check their rules and consider whether their rules should be updated to prevent short-term stay businesses causing issues for their buildings. Owners corporations should obtain legal advice on their options to stop short-term stay businesses operating in their building.

Tisher Liner FC Law’s specialist owners corporation division congratulates their owners corporation client on their successful result in VCAT.

Nicole Wilde | Solicitor |

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: nicolewilde@tlfc.com.au

Web: http://www.tlfc.com.au

Keep your diary well!

One of the most important parts of running a business is debtor management. But inevitably, however well you manage your customers, sometimes a customer will not pay, either because he or she can’t pay, or he or she no longer wants to. The time eventually comes round for enforcement.

One aspect which often lets businesses down when the need arises to enforce a debt is the lack of adequate details about work performed and materials used. Courts often do not take invoices at face value. If tested in Court, the Magistrate usually requires a detailed breakdown of every hour worked, the identity of the person who did the work, and a breakdown of every item of material used, and evidence of the cost of that material. There is in most cases no better evidence of this than a diary entry made on the day of the work that was done. In contrast, if you wait until the time comes around to issue an invoice to estimate in retrospect what work has been done, and the cost of the work is challenged, the risk you run is that a Magistrate may choose to disagree with your estimate and discount your invoice significantly.

Clients who are most often caught out are clients in situations where there was originally a fixed-price contract, but some disagreement or other obstacle arises and the whole project is not completed as originally planned. In this case, often there is a scramble to work out exactly what has been done, when, and by whom. Also, materials used may not have been recorded in detail or at all and need to be back-estimated. Keeping a work diary in fixed-price contracts may appear unnecessary at the outset, but if things don’t go to plan it can be invaluable in backing up your claim.

We recommend you keep a record of all work done and all materials used, on the day the work is done or the materials used, and whether or not you think you will need the record later. Good record-keeping is invaluable in strengthening a case to get the money you deserve from a customer who doesn’t want to pay.

Please contact Samuel McMahon, Simon Abraham or Sam Recht to assist with your litigation queries.

Samuel McMahon | Associate

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: smcmahon@tlfc.com.au

Web: www.tlfc.com.au

Subscribe to our blog at: blog.tlfc.com.au

NOTICE: This email is confidential and may be subject to legal professional privilege and/or copyright. If you are not the intended recipient, please contact Tisher Liner FC Law immediately by return email or telephone +61 3 8600 9333 and delete the document. In this case, you should not copy this email or any attachments or use it for any purpose nor communicate its contents to any person. Thank you.

Liability limited by a scheme approved under Professional Standards Legislation.

Retail Leases Case Law Update- Landlord withholding consent of assignment

Section 61 of the Retail Leases Act 2003 deals with when a landlord can withhold consent of a proposed transfer of lease by the tenant.

We acted for the successful landlord party in a Victorian Civil and Administrative Tribunal decision just released in which the landlord refused consent to an assignment of lease on the basis that the proposed tenant lacked sufficient business experience and financial resources. The case involved a sushi and noodle bar which was licenced.

The proposed tenant had no experience in the restaurant business or in any business but relied on a un-official business partner who did have some limited business experience to manage the business. The landlord withheld consent and the tenant issued proceedings at VCAT seeking an order that the transfer be permitted.

VCAT confirmed that the landlord had not been unreasonable in withholding consent and dismissed the tenant’s application. VCAT stated that whilst a tenant might be able to meet the obligations of operating such a café without extensive experience, a tenant without any experience in running a food business may not be able to meet the obligations under the lease. Further, VCAT determined that in order for a landlord to be able to properly assess a tenant’s financial position, the prospective tenant must provide sufficient and substantiated documents to show the prospective tenant’s financial resources.

Lessons to be learned:

Tenants- Treat the request to the landlord for assignment of the lease seriously and not as a mere formality. Provide comprehensive and detailed information on the proposed tenant’s business experience and financial resources.

Landlords- Assess the information provided by the proposed assignee and withhold consent if necessary (you are deemed to consent if you do not withhold consent formally within 28 days of a request).

For leasing advice and assistance in leasing disputes contact Phillip Leaman, Frank Tisher, Michael Fetter, Ron Cohen, Alan Goldstone, Jonathan Tisher, Caroline Inglis or one of the Tisher Liner FC Law property law team.

Phillip Leaman | Senior Associate | Accredited Business Law Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: pleaman@tlfc.com.au

Web: http://www.tlfc.com.au

Why Mediate?

Members of Tisher Liner FC Law are experienced in representing clients in Mediations and Dennis Liner has conducted hundreds of Mediations for a period exceeding twenty years.

We asked Dennis to explain his experience why people embrace the Mediation process. He sets our various reasons:-

1 Costs

Participating in Mediation when matters are subject to Court proceedings (or such proceedings are contemplated) is a cost-effective manner in which to resolve a dispute. The obvious alternative is to conduct litigation which is extremely expensive, requiring significant preparation, documentation, appearances and all the associated steps relevant to conducting a Court case.

2 Time

Most Court cases require a considerable amount of input by way of time, seeing Lawyers, Counsel, attendances at Court etc. The time required to devote to a Mediation would usually involve considerably less preparation and usually the matter is resolved in a Mediation in one day, as opposed to even a short case in Court which may run over many days.

3 Certainty

Although achieving a result by way of settlement or otherwise in a Mediation is not compulsory, by participating in a Mediation and having a matter resolved, there is certainty as to the outcome. Any Court proceeding will depend on the presentation and interpretation of evidence (including Experts), a finding by a Judge as to such facts and than applying the Law and these two variables can have outcomes which may not be favourable. The Mediation process enables a result to be achieved and at the end of the process each party knows the outcome with certainty.

4 Making your own decisions

Most people prefer to make their own decisions. The Mediation process permits a party to a dispute to make a decision about an outcome and, even if the outcome is not precisely that which a participant would have liked at the commencement of the process, at least a participant has made the decision. Experience shows that most people prefer to be in a position of making their own decisions and living with such decisions afterwards.

5 Flexibility in the outcome

Parties to a Mediation are able to negotiate outcomes in a manner which may not be ordered by a Court. There are no right or wrong outcomes, only those that the participants may adopt. The result may be outside any prior preconceived outcome. If the parties decide to agree, even if such outcome was not what a participant would have originally contemplated, then the matter is finalised and everyone can get on with their usual business and life activities.

Accordingly, most parties prefer to avoid Court proceedings and would prefer to participate in a Mediation because of costs, time, certainty and being able to make their own decisions.

Please do not hesitate to discuss the potential for Mediation in respect to any dispute or proceeding with the members of Tisher Liner FC Law.

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: dliner@tlfc.com.au

Web: http://www.tlfc.com.au

Commercial and Retail Leases- Define your permitted use carefully

Every lease sets out the permitted use which governs the way the tenant can use the premises. One of the most frequent questions we are asked is what should the permitted use say and does this advice change if you are a landlord as opposed to a tenant?

Our firm was recently involved in a matter where the tenant was entitled to use the premises for “any legal use of the premises”. The premises was being used as a clothes shop. The tenant wished to transfer the lease to an adult book store operator and the landlord did not want to approve the transfer for a range of reasons including that they had a moral objection to the proposed use of the store. This case illustrates the importance of the noted use of the premises.

There are various factors to consider when determining what the permitted use should be. For example, a broad permitted use such as “any legal use of the premises” or “any retail use” will give the greatest flexibility to the tenant in assigning the lease to another party and in operating its business. This means that the tenant who is a clothes shop could transfer the lease (or change its business) to a restaurant or a completely different business. A broad permitted use may also assist the landlord in a market review as the valuer can consider the best use of the premises in determining the value of rent rather than fixing the value based on a narrow use of the premises which may adversely impact on the value of rent. Section 37 of the Retail Leases Act 2003 provides that the valuer must take into account the value of putting the premises to the same use allowed under the lease. However, a broad use will also allow the tenant to assign the lease to any other business which may be contrary to the landlord’s interests.

The permitted use should be considered and negotiated early on. Ultimately, the landlord and tenant will need to strike the right balance between what is right for them now and in the future.

For leasing advice contact Phillip Leaman, Frank Tisher, Michael Fetter, Ron Cohen, Alan Goldstone, Jonathan Tisher or one of the Tisher Liner FC Law property law team.

Phillip Leaman | Senior Associate | Accredited Business Law Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: pleaman@tlfc.com.au

Web: http://www.tlfc.com.au

Nominations: Are you at risk of attracting double stamp duty?

Often when signing a Contract of Sale you are unsure who the purchasing entity should be. As a general rule, this should not be a concern because the general form of Contract gives you the right to nominate an additional or substituted purchaser. However, prior to nominating it is very important to make sure that you are aware of the stamp duty implications your nomination may have.

In some circumstances, a nomination will be assessed by the State Revenue Office as a separate transaction which will attract additional full stamp duty. For example, you may be at risk of attracting double stamp duty if any additional consideration is paid (over and above the purchase price). In these circumstances the State Revenue Office will view it as two separate transactions and will assess two lots of stamp duty (subject to any exemptions which may be available).

A second example where there can be additional stamp duty is where there is any land development which takes place prior to the nomination. Land Development is broadly defined by the State Revenue Office as follows:-

Preparation of a plan of subdivision or taking steps to have the plan registered;
Applying for or obtaining a planning permit in relation to the use or development of the land;
Applying for or obtaining a building permit or doing anything for which a building permit is required; or
Developing or changing the land in any other way that would lead to the enhancement of the property’s value.

As you will want to avoid attracting double stamp duty, you will need to consider whether any exemptions are available to you.

In this respect the details and timing of your nomination are very important. Accordingly, if you will be nominating an additional or substituted purchaser please contact your lawyer as soon as possible to discuss your options.

For property and conveyancing matters, please contact Ron Cohen, Frank Tisher, Jonathan Tisher, Michael Fetter, Alan Goldstone, Julia Thermos or Phillip Leaman to discuss your needs.

Julia Thermos | Lawyer

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: jthermos@tlfc.com.au

Web: www.tlfc.com.au

Liability limited by a scheme approved under Professional Standards Legislation.

Changes to the Franchising Code of Conduct- Get Ready now

In an announcement by the Government in the last few days and following on from the Alan Wein report, there will be amendments made to the Franchising Code of Conduct and the Competition and Consumer Act 2010.

In particular, Franchisors will need to review their current documentation and consider whether certain terms contained within them will be unenforceable when the new code comes in force.

As part of the reform, the ACCC will have greater powers to issue infringements for breaches of the Code of Conduct including $8,500 infringement notices and penalties of up to $51,000 if proceedings are issued in the Court.

Those Franchises with marketing funds will also be affected as the reforms aim to make funds more transparent.

The changes will introduce a general duty on franchisors and franchisees to act in good faith during their dealings with each other which will reinforce the general common law duties.

The short form disclosure statement which is for Franchisees with expected annual turnover of $50,000 or less will also be removed.

The changes are expected to take effect from 1 January 2015.

Franchisors must update their Disclosure Documents annually and must ensure that their Franchise Agreements are lawful at all times.

If you are a Franchisor who needs assistance with compliance issues or if your documents have not been reviewed for some time, now is the time to contact a solicitor.

Tisher Liner FC Law have experience in franchise matters and act for franchisors and franchisees. For assistance, please contact Phillip Leaman, an accredited Business Law Specialist or Ron Cohen, Michael Fetter or Felicity Simpson.

Phillip Leaman | Senior Associate | Accredited Business Law Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 |

DX 181 Melbourne Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: pleaman@tlfc.com.au Web: http://www.tlfc.com.au

Interference with Contractual Relations- Issues when poaching employees of a competitor

Our firm recently made use of the tort of interference with contractual relations when protecting a medical centre whose doctors were approached by a rival chain of medical centres as part of an intensive attempt to induce doctors contracted to our client’s medical centre to breach their contracts and commence working for the competitor.

When does an approach to ‘poach’ a person contracted elsewhere cross the line between making a lawful offer to a potential employee or contractor compared to an unlawful interference with contractual relations?

The question strikes at the heart of our economic and legal system both of which are based upon principles of freedom of contract and freedom of choice. However, parties that freely enter contracts cannot freely breach such contracts and Courts have shown that they are prepared in some cases to provide relief against unlawful interferences with contractual relations.

The tort known as interference with contractual relations occurs where a third party intentionally procures or induces a party contract to breach it. The wronged party to the contract can bring a claim for damages against the third party who procured the breach.

These tensions came to light in Australia in 1996 when Australia’s domestic rugby league competition split following News Limited’s decision to set up a new rugby league franchise known as Superleague. News Limited induced rugby players with significant financial sums to walk away from contracts at existing clubs and play in the new competition. The law would usually have dealt with this situation through actions for breach of contract on the part of each of the clubs against each of the players. Instead, the Federal Court initially held that News Limited had unlawfully interfered with the contractual relations that the clubs had with their players and imposed an injunction restraining the new competition from operating.

If a third party ’wrongdoer’ is to be restrained from making approaches to others, here is what will need to be shown by the aggrieved party to rely upon the tort of interference with contractual relations:

Knowledge on the part of the wrongdoer of a contract or the likely existence of a contract; and
An intention by the wrongdoer to interfere with the contract; and
Actual interference with the performance of the contract causing quantifiable damage to the aggrieved party

Recent case law has made it clear that the wrongdoer does not need to know the precise details of the contract but merely to be aware of there being at least a substantial prospect of a breach – with a decision being made by the wrongdoer to proceed in any event.

Should you have any questions about interference with contractual relations or any other litigation, employment or insolvency matters, please do not hesitate to contact Simon Abraham, Sam Recht or Phillip Leaman.

Simon Abraham | Partner | Accredited Commercial Litigation Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: sabraham@tlfc.com.au Web: http://www.tlfc.com.au

Liability limited by a scheme approved under Professional Standards Legislation

How much freedom do you really have when making a Will?

You spend a lifetime working hard to accumulate your assets and during this time you acquire certain rights, allowing you to sell, lease and give these assets away as you see fit. It is only natural that most clients expect that they can distribute their assets in any manner they like in their Will, be it passing down the inheritance to their family or donating it to a charity.

Many are surprised to learn that whilst the law recognises that Willmakers have freedom to dispose of their estate as they see fit, there is nevertheless recourse through the Court system for those who can prove that the testator breached their moral duty to make provision for them.

How does it work?

The Administration and Probate Act 1958 sets out that after the Willmaker’s death, a person who thinks they did not receive a sufficient share of the estate may bring a Court action against the estate. They need to show:

1. That the Willmaker had responsibility to make provision to that person for the person’s proper maintenance and support;

2. adequate provision for the proper maintenance was not made; and

3. the amount of further provision is warranted.

The Court will have regard to a number of factors, including the nature of the relationship, whether the applicant was dependent on the deceased, the size of the estate, the competing claims on the estate, etc.

Who can apply?

Anyone may bring an application as long as they can convince the Court that they satisfy the criteria. In practice, this would generally involve children and spouses, although, as each situation depends on its facts this could involve other claimants (such as grandchildren, de facto spouses residing separately, etc).

What does that mean for you?

Coming back to the topic of this blog, yes you are at liberty to make a Will as you see fit. However when you pass away, claims may be brought against your estate (which delays distribution to the beneficiaries and inevitably eats up funds in the estate).

Situations where some thought should be given to these provisions may be:

When you have been in a long term relationship but are not leaving a substantial part of your estate to your spouse. The courts are generally sympathetic to partners who have insufficient funds for maintenance or have received a life interest in a property which does not allow them to sell the property and use the proceeds.
In a blended family situation. It can be difficult to find a balance between making provision for children from a first marriage, ensuring the current spouse will be cared for in old age and possibly leaving something for children/step-children from the second relationship.
Where one child is deliberately omitted. The law does not require that all children be given equal distributions, however it is wise to discuss the reasons carefully with your solicitor.

What can you do if you think someone may make a claim on your estate?

Discuss this with your solicitor. A solicitor familiar with this area will assist you to make an informed risk assessment.
Articulate in writing the reasons for leaving that person out. This record can be kept together with the Will and be used as evidence where a relationship breakdown has occurred.
Consider leaving the potential applicant a small portion rather than nothing if the risk of them claiming is high.
Pass on your estate to your intended beneficiaries during your lifetime or set up a family trust.

For further assistance on estate planning and wills please contact Dennis Liner, Sam Recht or Liya Katz.

Liya Katz | Solicitor

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: lkatz@tlfc.com.au Web: http://www.tlfc.com.au

Liability limited by a scheme approved under Professional Standards Legislation

Are all mortgages stock standard or should I be concerned?

Each mortgage is different and needs to be reviewed carefully. There are a range of issues that you may not be aware of which need to be considered. Some of these include the following:

1. Is the interest payable based on a fixed or variable rate? Alternatively is it a combination?

2. Is the loan an interest and principal loan or just interest?

3. What is the term by which the full amount must be repaid? Will you be able to repay the loan within that time frame?

4. Do you have discretion to repay the loan more quickly or are there penalties for early repayment? If so, what are the penalties?

5. Can you lease the property without mortgagee’s consent?

6. What security is the bank taking? Is it linked to one property? Are there any personal guarantees? Are there any charges?

7. If you are late with a repayment, what is the default rate payable?

Tisher Liner FC Law has expertise in all forms of mortgage from the complex to the standard. Please contact Jonathan Tisher, Michael Fetter, Ron Cohen, Frank Tisher, Alan Goldstone and Phillip Leaman to discuss your needs.

Jonathan Tisher | Partner | Accredited Property Law Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: jtisher@tlfc.com.au Web: http://www.tlfc.com.au

Liability limited by a scheme approved under Professional Standards Legislation

Privacy Laws take effect today

In December 2013 we informed you about the new privacy law changes in our blog post: http://blog.tlfc.com.au/2013/12/02/spam-and-privacy-obligations-for-business-have-you-prepared-for-the-new-law/

As at 12 March 2014 (today), the privacy law changes now take effect. To see if they apply to your business, obtain the handy checklist prepared by the Office of the Australian Information Commissioner. It can be found at http://www.oaic.gov.au/privacy/privacy-resources/privacy-business-resources/privacy-checklist-for-small-business

A party to whom you have collected or hold personal information of can make a complaint to the Australian Information Commissioner. The Commissioner can prohibit an organisation from continuing or repeating certain conduct which breaches the Act, direct the organisation to take action to redress loss and damage suffered by a complainant or to pay specified amounts by way of compensation. Usually, the Commissioner will attempt conciliation in the first instance.

If you are subject to the Privacy Act, you must review and update your policies now to ensure that you can use the information you collect.

For assistance in reviewing your privacy policy, please contact Phillip Leaman, Caroline Inglis or one of the business law team.

Phillip Leaman | Senior Associate | Accredited Business Law Specialist
TISHER LINER FC LAW
Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne
Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: pleaman@tlfc.com.au
Web: http://www.tlfc.com.au

Is developing land really that hard?

Many people believe that developments can’t be that hard and that they are very lucrative. However, they can go wrong in many ways. Here are a number of the big ticket items that need to be considered.

1. Finding land – The right land is hard to find. Is the title clear? Are there any easements or covenants? Are there any long term leases which will prevent a development in the short term? Are there any GST implications?

2. Use of the land – What can be done on the land? Will it be used as residential, commercial, industrial or a mixture? What type of development can be constructed on the land? What is on the adjoining properties and how will this impact on whether a permit will be granted?

3. Town planning – What is the zoning? What are the setbacks? Is Council likely to be supportive? How do you deal with objectors? If a permit is not issued, are you likely to obtain a permit at VCAT? What sort of experts should you brief?

4. Selling lots once a permit is obtained – Which agent should you use? How do you set your price? What if the lots are not selling? Should you build a display suite? How many lots do you need to sell to obtain funding from a bank?

5. Building the development – Which builder should you use? How do you make the determination? What form of building contract should you use?

6. Funding – What are mortgagee requirements? What sort of funding will be provided? Will a tripartite agreement be required?

7. Monitoring the process – How is the development being managed? Will the project be completed in a timely manner? What if there are defects? What if there are delays?

Tisher Liner FC Law is one of Melbourne’s leading property development firms and has significant experience in all aspects of a development from reviewing the contract, town planning advice, selling off the plan, reviewing building contracts and dealing with finance documentation.

Please call Jonathan Tisher, Ron Cohen, Frank Tisher, Michael Fetter, Alan Goldstone, Dennis Liner, Phillip Leaman and Caroline Inglis for your development queries.

Jonathan Tisher | Partner | Accredited Property Law Specialist

TISHER LINER FC LAW

Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne

Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: jtisher@tlfc.com.au Web: http://www.tlfc.com.au

Liability limited by a scheme approved under Professional Standards Legislation

Easements explained

Often when we are asked to advise clients about potential issues with a property they wish to purchase, there is an easement registered on the title. The potential impact of an easement can vary from having very little impact to situations where a property has been constructed over an easement and there can be potential issues if access to the easement is required by the relevant authority. Easements need to be considered as part of the due diligence on a property purchase, particularly where development is proposed.

Put simply, an easement is a property right to use an area of another person’s land without owning it for purposes such as access (e.g. a right of way) and services (e.g. sewerage).

Easements run with the land which means that a purchaser of land will purchase the land with the easement.

What should purchasers look for?

The first step is to identify the location, size and nature of the easement that burdens the Land. This will be shown on the title search/plan.
What do you want to do with the land? i.e. does the purchaser intend to develop the land? Will the easement prevent a proposed development? If so, a detailed consideration of the easements particularly in respect to town planning issues is required. You may need to relocate or remove the easement which can be a difficult process.
If relocation / removal is needed you will need to identify all of the land which benefits from the easement to determine how many different land owners will be affected by the removal of the easement. E.g. if a search identifies 30 – 40 lots of land which benefit from the easement then removal of the easement may be more difficult than if only one lot has the benefit.
Depending upon how critical the removal / relocation of the easement is to the development and the purchaser’s proposed use of the land, it would be advisable to negotiate a condition in the contract of sale to provide that the contract is conditional upon obtaining a planning permit to relocate the easement.

There is an easement, it needs to be relocated or removed…. Now what?

Easements can be relocated / removed pursuant to a planning permit issued by Council, authorising the relocation / removal of the easement. If a planning permit is obtained, the owner of the land burdened by the easement can lodge a plan for registration under section 23 of the Subdivision Act and when registered, the easement is relocated or removed as provided by the plan.
Consider contacting the Council or the relevant statutory authority (if the easement is a utility or service easement) to seek feedback about whether the relocation or removal is likely to be approved. For example, the easement may be for the benefit of a water authority and is no longer in use and the authority is therefore happy to consent to its removal.
There are other ways to remove an easement such as by application to VCAT under s36 of the Subdivision Act or under the Transfer of Land Act if the dominant land owner surrenders the easement to the burdened land owner or, by application to the registrar to remove an easement on the basis that it has been abandoned or extinguished.

Tip of the day: Before you sign a contract of sale make sure you inform your lawyer of your proposed use for the land and ask whether any easements may affect that use.

For advice in relation to easements, planning and property law matters please contact Jonathan Tisher, Frank Tisher, Ron Cohen, Alan Goldstone, Michael Fetter, Dennis Liner, Phillip Leaman, Caroline Inglis or one of the other Property law team at Tisher Liner FC Law.

Caroline Inglis | Lawyer
TISHER LINER FC LAW
Level 2, 333 Queen Street ( Cnr Latrobe Street), Melbourne VIC 3000 | DX 181 Melbourne
Ph: +61 3 8600 9333 | Fax: +61 3 9670 6359 | Email: cinglis@tlfc.com.au
Web: http://www.tlfc.com.au

Liability limited by a scheme approved under Professional Standards Legislation

Leasing update- Tenant defaults- Landlords don’t get it wrong.

Your tenant is late on paying the rent, what do you do?

Subject to commercial considerations, we recommend you act promptly when a default occurs, as most landlords have a limited security deposit to rely upon.

A formal notice of default can be served on the tenant. What to be careful of:

Make sure the tenant has previously been invoiced the amount alleged to be overdue;
Make sure the lease terms allow a default notice to be served in respect of the relevant amount. For example, the Law Institute of Victoria lease provides that the tenant has 7 days to pay outgoings, so a notice could only be served after day 8;
Make sure all current defaults by the tenant are listed;
Make sure the notice accurately calculates the default interest at the current rate allowed under the lease (if interest is being sought);
Make sure the notice is dated and signed;
Make sure the notice is served in accordance with the terms of the lease (i.e. to the correct address for the tenant);
Keep records of how and when the notice is served;
Count the number of days the notice must be complied with (usually 14 days) from the service date (usually 2-3 days after posting depending on the terms of the lease and how the notice was served). We recommend you count the days conservatively.

If proceeding with a lock out, get legal advice prior to doing so, as a failure to strictly comply with the procedure required by the lease will result in an unlawful lockout and the tenant could sue the landlord for damages sustained.

For leasing disputes and advice contact Phillip Leaman, Frank Tisher, Michael Fetter, Ron Cohen, Alan Goldstone, Jonathan Tisher or one of the Tisher Liner FC Law property law team.

Contracts- Are they binding? What are the common mistakes?

Most parties entering into a transaction worry about the big ticket items and sometimes forget about the little details or fail to properly document the agreement. It can be the small details which can make the difference between whether a contract is interpreted in one party’s favour or whether the agreement is actually enforceable.

Some of the most common mistakes and issues we come across when advising parties who failed to get it right and usually end up in dispute are:

Incorrect entity details. The wrong entity has been listed as a party. This can occur when there are multiple parties which own or deal with different parts of the business and an incorrect party is listed by mistake;
Invalid execution. For example, only one director signing when two directors are required to sign or a person purporting to be a director signs but is no longer a director on the Australian Securities and Investment Commission (ASIC) records;
All parties failing to initial last minute hand made amendments, making those amendments unenforceable;
Not all guarantors sign the final document. Subject to wording in the contract saving you, this may lead to the guarantee being ineffective against all guarantors;
Failing to exchange the document properly. You both sign the contract but never formally exchange the signed document;
Failing to properly renew the agreement. The agreement allows for the renewal but you do not document the renewal and/or not all the original parties sign the renewal (such as the guarantors) and therefore some parts (such as the guarantee) may no longer be enforceable;
Not documenting amendments or variations to contracts. Usually the contract will provide that any amendment to the contract is not valid unless a document with the amendment is signed by all parties; and
Not adequately dealing with all issues and documenting the terms agreed upon accurately and unambiguously. Can you read the provision in more than one way? If so, the provision needs to be re-written.

Our tips:

Obtain an ASIC company search to verify who are the directors of the party;
Have all amendments documented within the printed document rather than hand writing amendments or ensure every party initials all amendments;
Ensure every party listed in the document signs the document;
Have witnesses sign that they witness an individual’s signature and ensure that their name and address is included;
Ensure all witnesses are over the age of 18 years and are independent (I.e. not a party or a director of a party);
Have all original parties execute a formal renewal or variation document; and
Get the contract professionally drafted to ensure that the agreement is reduced to writing in the way the parties agreed upon.

Tisher Liner FC Law are Business Law specialists and handle commercial matters for clients.

For business law advice contact Phillip Leaman an Accredited Business Law Specialist, Michael Fetter, Ron Cohen, Alan Goldstone, Jonathan Tisher or one of the Tisher Liner FC Law business law team.

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