Binding Financial Agreements (BFA) are entered into with the clear intention of giving parties certainty and security in their financial arrangements before, during or after a relationship ends.  However, predicting the future is (sadly) not something that parties nor their lawyers can achieve and sometimes, circumstances arise during a relationship which, upon separation, can result in grounds for the setting aside of a Binding Financial Agreement.  Most commonly, BFA’s are set aside for failure to disclose assets or other intentional conduct such as engaging in fraud or unconscionable conduct.
However, the Full Court of the Family Court of Australia recently considered s90K(1)(d) of the Family Law Act 1975 (the Act) in the case of Frederick & Frederick [2019] FamCAFC 87.  The recently published decision upheld an appeal by the Wife of a decision to not set aside a BFA on the basis of s90K(1)(d).
Section 90K(1)(d) of the Act provides:
90K

A Court may make an order setting aside a financial agreement or a termination agreement if, and only if, the Court is satisfied that:

(d)       since the making of the agreement, a material change of circumstances has occurred (being circumstances relating to the care, welfare and development of a child of the marriage) and, as a result of the change, the child, or, if the applicant has caring responsibility for the child (as defined in subsection (2)), a party to the agreement will suffer hardship if the Court does not set the agreement aside.
In Frederick the parties entered into a BFA in 2007 (prior to their marriage).  The parties separated and in 2017 the Husband filed an Initiating Application seeking a declaration that the BFA was valid and binding.  The Wife responded with an application to set the agreement aside, relying upon (amongst other grounds) s90K(1)(d) of the Family Law Act.  The Wife’s application was dismissed by the Federal Circuit Court of Australia and she appealed.
The basis of the Wife’s application under s90K(1)(d) was the diagnosis in 2009 of one of their children suffering from atypical autism, mild functional/adaptive impairment and pica.  These diagnoses resulted in significant challenges and behavioural issues for the child resulting in a very high level of care being required by the child.
The Federal Circuit Court found that the emergence and diagnosis of the child’s difficulties were material changes of circumstances as set out in s90K(1)(d) and further that “the identified changes have caused and will continue to cause hardship to both parties, by reason of much more onerous care responsibilities and increased costs”.  However, notwithstanding these findings, the Court did not consider that the wife would suffer hardship if the agreement was not set aside.
The terms of the BFA were, in a general sense, that the Wife had made no contribution towards the acquisition, conservation or improvement of the Husband’s pre-existing assets. As a result, the agreement stated she was not entitled to any portion of those assets, other than any increase in asset/or the matrimonial home or replacement asset or assets purchased from the sale or refinance of that property.
At the primary hearing, the court concluded that as the wife’s claim was limited to any increase in value of the assets, the lack of evidence as to their current value resulted in the court being unable to undertake a meaningful comparison between the different positions (namely, if the agreement was or was not set aside) and the claim failed.
The only evidence was some conjecture given by the Husband under cross examination as to his view on the current values of the assets which were still in existence and referred to in the BFA.  The Full Court held that the preliminary comparison required by s90K(1)(d) resulted in the Husband’s evidence needing to be given some weight and that it mattered not that better evidence could have been called (and the note for parties there is to ensure that adequate and appropriate admissible evidence of value is available).
Accepting the Husband’s evidence as the best evidence the court had available, the Full Court held that the value of property available for division if the BFA was valid was some $100,000 and if it was set aside, some $4,000,000.   It held that on this basis, hardship was clearly established.
The Court then considered the Wife’s case at its highest, namely that after a relationship of some 10 years with two children being born (one with a significant disability and the primary care of both children resting with the Wife), the Wife’s contributions and future needs would result in an outcome which could not be satisfied from the smaller pool as proposed by the Husband.
The Court set aside the BFA and the matter was remitted for hearing as to a just and equitable division of assets, taking into account the contributions of the parties and their future needs.
Arguably, this application ought not to have been brought by the Husband.  Obtaining sensible, strategic and cost effective legal advice may well have resulted in the Husband receiving advice about the real effect of his child’s disability and its intersection with s90K(1)(d) and the parties could have negotiated an outcome which would have avoided a primary hearing, an appeal and then a subsequent costs decision (the Husband having to pay the Wife’s costs of the Appeal in the amount of $25,000).   Whilst the Husband had the prima facie right to rely upon the terms of the BFA, advice from an experienced and strategic family law firm such as Marino Law, may well have saved the Husband (and Wife) many years of litigation and costs which would have been better applied to the care of their young children.
Marino Law takes an holistic approach to the practice of family law.  We provide clear advice as to the strict application of the law, however balance it with strategic and sensible advice about the practical reality of proceeding with any chosen course of action.  Our role as your family law advisor is to ensure that you make decisions with a thorough and clear understanding of the practical, legal and financial implications of your chosen courses of action.  From the drafting of a Binding Financial Agreement, advising upon such agreements or advising on the possibility of setting aside an existing Binding Financial Agreement, for holistic, strategic and no-nonsense advice, contact Marino Law on 55260157 for an appointment to discuss your family law matter.
 
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While there are limited exceptions, Mediation in family law disputes is compulsory prior to seeking relief from the Court. In many cases Mediation does assist parties to resolve dispute, but what about those cases where Mediation fails or serves only to resolve some aspects of the dispute?
In this case parties will be issued with a certificate (s60I Certificate) by the Mediator and there is little option but to commence proceedings in either the Federal Circuit Court or the Family Court. The nature of the dispute will determine the Court in which an Initiating Application should properly be filed. The same care and attention should be given when preparing documents to commence proceedings in either Court.
Proper preparation for court proceedings is vitally important, particularly with respect to the following:
Drafting appropriate and comprehensive Orders to be sought in your Initiating Application, including both Final and Interim Orders.

An Initiating Application for Final Orders is the Application that commences your proceedings. This Application must set out the Orders that you seek, including Interim Orders, and should set out all causes of action that can be disposed of in the same case, ie Parenting Orders, Property Orders and Maintenance Orders.
Care should be taken to ensure that the Orders sought:

clearly set out the obligation of the party/parties in the order with specificity;
are capable of being made and enforced;

are not inconsistent with each other;

are supported by the available evidence; and
most importantly, are likely to be made by the court upon assessment of the evidence and the facts of the case.

Care must be given to the drafting of both Interim and Final Orders as this may affect the success of the Application.

Drafting relevant, concise and admissible evidence in support of an Application.
Evidence is filed in the form of Affidavit. When preparing Affidavit evidence care should be taken to:

Ensure that the evidence supports the Orders sought in the Application;
Ensure that the evidence is clear, concise and addresses the relevant criteria the court is required to take into consideration when determining the particular Application;
Ensure that the best evidence is contained in the Affidavit and is supported, where possible, with independent evidence. This is particularly important in Interim Applications given that there is no cross-examination in interim proceedings.

Ensuring that the evidence drafted stands up to objection.
Whilst it is always preferable that the evidence contained in your Affidavit complies with the rules of evidence, more often than not objections are not taken to evidence filed in interim proceedings.
Unlike evidence filed in interim proceedings, evidence filed in final proceedings must withstand objection, particularly in financial proceedings.
Objections can be made for a number of reasons, but are most commonly based on hearsay, opinion, relevance and/or submission.
Ultimately, when preparing a matter for hearing, whether it be interim or final, care and time should be taken when drafting an Affidavit and having the witness swear/affirm the Affidavit as any flaws, errors, inaccuracies or the like will become evident during the course of any hearing, either as a result of an objection taken or when the deponent of the Affidavit is cross-examined.
Ensuring that the evidence filed in your case adequately addresses the matters that the Court is required to consider depending on the relief sought.
Most importantly, your evidence must be relevant to the issues in dispute and matters the Court is required to take into consideration in determining the proceedings.
The consequences of attempting the above without a suitably experienced family lawyer can be significant.  Our Family Law Accredited Specialist led team of experienced family lawyers can assist with all aspects of your family law requirements.  Contact us today.
 
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First home loan deposit scheme, land tax changes, combustible cladding extensions and paper certificates of title become redundant
The 5% first home loan deposit scheme
From 1 January 2020, Scott Morrison’s Federal Government will outlay an estimated $500 million to fund the First Home Loan Deposit Scheme (“Scheme”), which will assist first home buyers nationally to enter the property market.
Provided the first home buyer has saved a deposit of 5% of the property value, the Federal Government, via the National Housing, Finance and Investment Corporation will guarantee the additional loan amount between that 5% and up to 20% of the property value.
This means that Buyers will only have to save a 5% deposit, as opposed to the usual 20%, and will no longer be required to obtain Lender’s Mortgage Insurance. On a $400,000.00 loan, this represents an approximate saving of $10,000.00 on Lender’s Mortgage Insurance alone.
The Scheme is planned to be available to single individuals with an annual income of up to $125,000.00 or couples with a combined income of up to $200,000.00, provided they are both first home buyers.
The Scheme will not be applicable to every single first home buyer loan application, and will be capped to 10,000 loans per year. In 2018, there were approximately 112,000 loans applied for by first home buyers, which means that the Scheme will only apply to approximately 10% of loan applications. The value of eligible homes under the Scheme will also vary by region.
The Scheme is proposed to remain in place for the life of the loan, but would cease in the event of a refinance.
COMBUSTIBLE CLADDING – EXTENSIONS FOR COMPLIANCE TIMEFRAMES
Marino Law has previously written an article which sets out important information regarding the Building and Other Legislation (Cladding) Amendment Regulation 2018, which commenced on 1 October 2019.
A copy of that article can be found by clicking here.
Part 1 of the regime required owners of affected buildings to identify whether the building has combustible cladding and complete an online checklist with the Queensland Building and Construction Commission (“QBCC”) by 29 March 2019.
Due to delays with completion of Part 1, the Queensland Government has extended the deadlines for completion of Part 2, which requires an owner to engage a qualified building professional to answer various questions about the materials used in construction and confirm whether the exterior of the building is potentially combustible. The current timeframe is 29 May 2019, however this has now been extended to 31 July 2019.
Where Part 2 identifies that a building has combustible cladding, Part 3 involves the owner engaging a fire engineer to prepare a fire safety risk assessment and supply the fire engineer’s details to the QBCC by 27 August 2019, which has now been extended to 31 October 2019.
The final fire engineers report is still to be given to QBCC by 3 May 2021.
LAND TAX CHANGES IN QUEENSLAND STATE BUDGET
The Queensland Government has increased the rates of land tax payable by companies and trusts whose combined landholdings are $5,000,000.00 or more.
The rates have been increased by 0.25% and the new rates are as follows:-

25% for each dollar above $5 million; and
75% for each dollar above $10 million.

Absentees who are not permanent residents of Australia will have their 1.5% land tax surcharge increased to 2% from 2019-20. This rate will apply to individuals, foreign corporations and trustees of foreign trusts.
The definition of absentee is also changing and from 30 June 2019, Australian citizens and permanent residents that hold permanent visas living, working or travelling overseas for an extended period will no longer be classed as absentees.
PAPER CERTIFICATES OF TITLE REDUNDANT FROM 1 OCTOBER 2019
In Queensland, the current Torrens Titling System is such that a property owner can elect to have an electronic title, or the more traditional paper certificate of title as proof their ownership.
However, from 1 October 2019, amendments to the Land Title Act 1994 (Qld) will result in paper certificates of title no longer having any legal effect. These paper certificates will instead become an item of historic or sentimental value only.
There will also no longer be an option for an owner to lodge a Form 19 – Application for Certificate of Title with the Land Registry to obtain a paper certificate of title.
There will no longer be any need for the paper certificate of title to be presented to the Land Registry when a dealing is lodged for registration, or, if same is lost, there will no longer be a need to dispense with producing the paper certificate of title, in order for that dealing to be registered.
CONCLUSION
Our property and commercial solicitors are well informed and technically focused to as to be able to provide you with commercial and practical advice across a wide array of transactions.
We practice in all commercial and property matters. For further information regarding any of the matters raised in this article, or to discuss any other matter, please do not hesitate to contact one of our experienced team today.
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On 1 October 2018, the Government passed the Building and Other Legislation (Cladding) Amendment Regulation 2018 (Qld) (the ‘Regulation’). In effect, the Regulation compels certain classes of building owners to undertake a three-phase process intended to identify and assess the fire safety risks associated with their building and its exterior components (ie cladding).
Which buildings need to be registered?
An affected private building is one which has combustible cladding forming part of, or attached or applied to, an external wall or another external part of the building other than the roof.
The Regulation places a responsibility on private owners of buildings that:

Are a class 2 – 9 and are of a type A or type B construction (essentially most residential and commercial buildings, excluding houses and other low-rise dwellings); and
Have been built or have had the cladding altered after 1 January 1994, but before 1 October 2018 regardless of any recognised certificate held by the building owner (i.e. certificate of conformity).

Interstate and overseas building owners
 An owner of a building in Queensland that lives interstate or overseas is not exempt from their obligation to comply with the Regulation. An agent can be approached to act on the owner’s behalf to complete the process.
Authorised agents
Authorised agents, such as body corporate representatives or property managers may need to comply with the Regulation if they manage a private building that comprises of 2 or more lots.
How to comply: 
Phase 1 (to be completed by 29 March 2019): register your name and building address via the Safer Buildings website at: www.saferbuildings.qld.gov.au and complete part 1 of the ‘combustible cladding checklist’ (questions 1 to 4) before submission online with the Queensland Building and Construction Commission (‘QBCC’).
Note, completion of part 1 will assist the owner to identify whether the building is privately owned, approximate size, materials used in the exterior construction, the building’s class and type, effectively ascertaining whether further action is required.
Phase 2 (to be completed by 29 May 2019): building owners are required to engage a building industry professional in order to prepare a building industry professional statement as to whether the material used in construction could potentially be combustible. Owners must submit the statement online with the QBCC and complete part 2 of the ‘combustible cladding checklist’ (questions 5 to 6).
Note, if an owner is aware of or suspects their building has combustible cladding and has given the QBCC notice, they may skip phase 2.
Phase 3(a) (to be completed by 27 August 2019): building owners are required to engage a fire engineer in order to prepare a building fire safety risk assessment and fire engineer statement. This will identify the type of cladding and insulation and whether existing fire safety measures need to be updated. The owner must enter the name and registration number of the fire engineer engaged online with the QBCC by the prescribed date.
Phase 3(b) (to be completed by 3 May 2021): once the building owner has received the above fire safety risk assessment and fire engineer statement they must, by the prescribed date, complete the ‘combustible cladding checklist’ (questions 7 to 10) and submit the relevant documents online. This final assessment will determine whether the building is affected and requires further rectification.
Note, the compliance periods may be extended upon approval from the QBCC. Further, all documentation for Phases 1 – 3 is required to be kept for at least seven (7) years after lodgement with the QBCC.
Affected private buildings:
If the building is deemed to be affected, building owners will be obligated to:

Display an ‘affected private building notice’ in a conspicuous position and ensure it is securely fixed near the main point of entry and near the fire indicator panel if applicable; and
Display the notice within sixty (60) business days after the building fire safety risk assessment is received until a time that the combustible cladding is removed or a private certifier gives the owner a notice of compliance with the Building Codes of Australia.

Sale of a building during the process
Up until the completion of sale, the building owner is responsible to register documents with the QBCC. If the ownership of a private building changes, the original owner must provide the incoming owner with a notice detailing their compliance with the Regulation, in addition to a copy of each document submitted up until the change of ownership. A further notice is required to be given to the QBCC.
Where the building is part of a community titles scheme, owners may need to consider disclosing the existence of combustible cladding to a prospective buyer in efforts to avoid a claim for breach of warranty or possible termination of contract under section 223 of the Body Corporate and Community Management Act 1997 (Qld). 
How can Marino Law help?
Marino law offers expert advice in relation to property matters, including advice with respect to the acquisition and disposal of both residential and commercial property. The firm has a rich history acting for both large and small scale developers, individuals, corporate and trust purchasers and various others. With the combined experience of our property lawyers and conveyancing department we can assist you by providing comprehensive advice in an efficient and practical, yet innovative manner that will be easy to understand.
Whether you are a developer, an industry professional or a purchaser, Marino Law can advise you as to how these new changes may affect you. Please contacts us today to organise an initial consultation with one of our experienced property lawyers.
 
The post Recent amendments to building cladding laws in Queensland appeared first on Marino Law.

In a week that has seen the Courier Mail (on Sunday 30 June 2019) publish an article entitled ‘Til debt do us part’, criticising the adversarial family law system and what they coined “routine” legal costs of some $300,000 and the Full Court of the Family Court of Australia publishing a judgment which stated that legal costs charged of over $400,000 to achieve an outcome of some $250,000 were “troubling indeed”, it is enlightening to see that the “Godzilla” of divorces has been settled amicably.
The Age today published an article regarding the separation and divorce of Jeff and MacKenzie Bezos and how same has seemingly been settled amicably and privately.
https://www.theage.com.au/business/companies/godzilla-of-divorces-the-world-s-most-expensive-split-set-to-become-official-20190701-p522u9.html
Ms Bezos is set to receive a 4% share of Amazon in her separation from Jeff, reportedly with a value of $US38 billion.
Jeff Bezos will however remain the worlds richest man with his 12% Amazon share worth $US112 billion.
The extent of their continued amicability was evident when Jeff commented on MacKenzie’s pledge to donate half of her fortune to philanthropic efforts.  Jeff tweeted “MacKenzie is going to be amazing and thoughtful and effective at philanthropy, and I’m proud of her”.
The Bezos separation is in stark contrast to other “mega-buck” divorces such as oil industry magnate Harold Hamm who litigated for over two years.
The Courier Mail piece identified that the adversarial nature of family law resulted in excessive fees and delays, with the potential for lawyers to be held personally liable for fees if they are considered to be intentionally delaying matters.  Federal Attorney General Christian Porter has called for reforms that would allow judges to make costs orders against lawyers for “failure to assist a client to comply with the duty to facilitate the just resolution of disputes as quickly and efficiently as possible.
Marino Law pride themselves on their practical and strategic approach to family law matters.  Focussing on early dispute resolution processes and alternative dispute resolution at all stages of disputes, we will work with you to resolve matters with as little delay and cost as possible.  Led by an Accredited Specialist in Family Law who has been ranked as a leading family lawyer on the Gold Coast for the last four years, the family law team at Marino Law are available to assist you with all manner of family law disputes.  Contact us on 55260157 to arrange an initial consultation with us.
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In 2012 the High Court of Australia published the much-lauded case of Stanford v Stanford.  The issues arising therefrom changed the landscape for property adjustment in Australia.  Fundamentally it provided for a preliminary step for the traditional “four-step process” in property settlements, by requiring the Court (and parties in their negotiations and lawyers in their advice) to consider first and foremost, is it just and equitable to even consider property settlement.
This additional step gave rise to the ability to cut a claim off at the first possible step, by asserting that, in the particular circumstances of the matter, there ought not to be any adjustment of assets.  The cases within which this is appropriate are not going to be your dime a dozen family law cases, but the case of Busch & Dyer [2019] FCCA 956 http://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/cth/FCCA/2019/956.html is one example of where the Court considered that outcome entirely appropriate.
Of course, the husband in this matter could have avoided the whole process of litigation, had he taken what we assume would have been the advice of family, friends and lawyers and obtained a binding financial agreement (colloquially known as a Pre-Nup).
In Busch & Dyer the wife came to the Court seeking a very modest property settlement, of some $25,000.
The husband’s position was that she ought not receive any property settlement and that she be forced to vacate his home.  The husband was in fact the Applicant in the proceedings, appearing to have made the relevant application in order to remove the wife from his home.
In the early stages of the proceedings, Judge Burchardt ordered the wife out of the former matrimonial home, but she “treated that order with distain” and did not comply with it.  The husband did not however seek to apply for a Warrant of Possession prior to the trial (perhaps adopting the path of least resistance in order to appear most sympathetic to the Court).
The factual matrix of the case in summary form is:

The husband was 52 by the time the matter was before the Court for trial;
He had ceased work in 2017 and was living off his savings;
The wife was 43 as at the date of trial, born overseas but coming to Australia in 2009 and achieving permanent residency in 2016 as a result of her marriage. The wife had two children from earlier relationships aged 21 and 16;
The parties met in 2013 and married that same year. The husband asserted separation in 2015.  Allegations of domestic and family violence ensued but were struck out by a local Court in 2016. The parties had remained under the one roof and not speaking since that time;
The parties divorced in July 2018 and the husband commenced his proceedings in August 2018;
The wife owned a business and a small property at the commencement of the relationship, disposing of the business shortly thereafter and not working from that time;
At the commencement of the relationship the husband owned the former matrimonial home, unencumbered (and held that way since 2004) as well as an investment property acquired in 2010;
The parties lived completely separate financial lives, with the wife making no contribution to costs associated with the ownership of the property and its utilities.

The husband’s case was quite simple.  The wife married him to secure permanent residency and faked her displays of love and affection in order to achieve her aim.  The husband described the wife as treating him “like a stranger in his own house”.
The wife accepted that the parties had lived apart since January 2015 and asserted that she paid for food and did housework and that the husband had never given her any money but that she was owed money by him.
The wife’s case amounted to, an assertion that because she was married to Mr Busch from 2013 until January 2015 she was entitled to remain in the home until her daughter finished high school in 2019 and that she was entitled to money from Mr Busch.
The Court found that such a position was “radically unsound”.
It is important to note that both parties appeared in Court as self-represented litigants, without the assistance of proper legal advice about the utility and prospects of the case being advanced (in relation to the wife).
The Court stated that whether or not the wife married the husband to simply get a visa (despite commenting that it was strongly of the view that she did), was irrelevant to the decision before it.
In dismissing any application for property settlement, the Court commented:
In circumstances where the marriage was of such fleeting duration, the party’s property interests, so far as they are disclosed, were wholly set in tone well before that relationship.  Neither party has obtained any financial gain out of the relationship save to the extent that the wife has lived rent free for some three or four years.  It is plainly not just and equitable that there be a property division.  Each of the parties must keep what they had at the start.
The Court further issued a Warrant of Possession for the property such that the wife had 21 days to relocate away from same before it was exercisable.
Now even though the husband did not incur the costs of legal representation at the hearing (that is not to say that he did not seek and obtain and pay for such advice during the conduct of the matter), the time, inconvenience and emotional cost of the proceedings would have taken its toll.
Whilst unromantic and some may say morbid, the husband could have (potentially) avoided the entire ordeal of a Court application by entering into a Binding Financial Agreement which would have provided for the circumstances within which the wife would be required to vacate the property and confirmed his obligation (or lack thereof) to provide financial support for her or property settlement to her.  In reliance upon its terms the husband could have simply excluded the wife from the property and gone about his life.
When entered into properly, having provided full and frank disclosure of financial matters and having received proper and complete legal advice, a Binding Financial Agreement is the most appropriate way to protect one’s pre-existing assets.  The most important part of this suggestion is ensuring the agreement is “entered into properly”, meaning that the document has been drafted by an appropriately experienced and specialist family lawyer with each party having the opportunity to fully consider its terms and effect and obtain legal advice (again from an appropriately experienced and specialist family lawyer) prior to its execution.
Too often we as lawyers are approached to “just sign off” on a document prepared by a party personally (having downloaded and paid for a pro-forma precedent form the internet) or drafted by a generalist lawyer, thinking that a Binding Financial Agreement is just like any other deed of agreement.   The family law team at Marino Law, headed by an Accredited Specialist in Family Law are acutely aware of the intricacies of drafting and advising upon a Binding Financial Agreements such that they are as “watertight” as possible.
Particularly in circumstances of a significant disparity of income and asset position, as unromantic as it is, consult with a lawyer before jumping into a relationship, the end of which could have significant financial impact upon you into the future.
Marino Law offer a discounted and fixed fee initial consultation with a member of our family law team.  Contact us on 0755260157 to discuss your circumstances and the steps we can take to assist you in asset protection.
 
 
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Recent amendments to the Corporations Act 2001 (Cth) (the “Act”) seek to deter avoidance of the payment of employee entitlements and to protect employee entitlements from transactions that avoid or prevent an employee from recovering their entitlements or significantly reduce the amount of those entitlements that an employee can recover in the winding up of a company.
The new amendments strengthen enforcement and recovery options to deter inappropriate market behaviours which result in the avoidance of the payment of employee entitlements, resulting in the improper shift of some or all of those costs onto Australian taxpayers through the drain on the taxpayer funded Fair Entitlements Guarantee scheme.
The Act now introduces tough criminal and civil penalties to individuals and companies that breach the Act as amended.
Criminal liability
Pursuant to section 596AB of the Act, it is an offence for a person to enter into a transaction, or if that person is an officer of a company, to cause that company to enter into a transaction, with the intention of, or with intentions that include the intention to:

avoid or prevent the recovery of the entitlements of employees of the company; or
significantly reduce the amount of the entitlements of employees of a company that can be recovered.

A person will also contravene section 596AB of the Act if they enter into the transaction or cause the company to enter into that transaction and they are reckless as to whether the transaction will lead to the results detailed in the above paragraph.
An individual may face the following punishments if convicted of a contravention of section 596AB of the Act:

10 years imprisonment;
a fine of $725,355.00 or an amount being three (3) times the benefit received by the company; or
both a fine and imprisonment.

A company that is convicted of contravening section 596AB of the Act may be liable for a fine that is the greater of the sum:

of $7,253,550;
that is equal to three (3) times the benefit received by the company; or
that is equal to 10% of the company’s annual turnover for the twelve (12) month period prior to the contravention.

Civil Liability
In addition to the criminal penalties detailed above, pursuant to section 596AC of the Act, a person who enters into a transaction, or causes a company to enter onto a transaction, that contravenes section 596AB of the Act may also liable to a civil pecuniary penalty where that person knows, or a reasonable person in the position of the person would know, that the transaction is likely to:

avoid or prevent the recovery of the entitlements of employees of the company; or
significantly reduce the amount of the entitlements of employees of a company that can be recovered.

Furthermore, pursuant to section 596ACA of the Act, a person who has contravened section 596AC of the Act may also be liable to a liquidator or the employees of the company for any losses that the company’s employees may suffer as a consequence of the transaction having been entered into.
A person who is involved in a contravention of section 596AC of the Act, such as a lawyer or an accountant, may also be liable for a civil pecuniary penalty. Pursuant to section 79 of the Act, a person is involved in a contravention where that person has:

aided, abetted, counselled or procured the contravention;
induced, whether by threats or promises or otherwise, the contravention;
been in any way, by act or omission, directly or indirectly, knowingly concerned in, or party to, the contravention; or
conspired with others to effect the contravention.

Conclusion
As the ramifications that a person can be exposed to as a consequence of a contravention of the provisions of the Act detailed in the above paragraphs can be substantial, immediate legal advice should be sought before any transaction is entered into that prevents an employee from recovering any of their employee entitlements or reduces the amount of those entitlements.
Marino Law has extensive experience acting for directors, liquidators, administrators, lenders, financiers and creditors in the administration of all corporate insolvency appointments. Our highly experienced lawyers regularly advise clients in the following areas of corporate insolvency:

director penalty notices;
voluntary administrations;
liquidations;
voidable transaction claims pursuant to part 5.7 of the Corporations Act 2001 (Cth);
enforcement of securities; and
statutory demands.

Should you require assistance in any of the above areas, please contact one of our highly experienced litigation and insolvency lawyers.
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It is a common misconception that registering a business name with the Australian Securities and Investment Commission provides the registrant with a proprietary right to that name. In fact, the only way to obtain ownership of a name or logo is to have the name or logo trademarked in each country in which your business operates.
The same applies to product names. You must register such names as trade marks in order to ‘own’ or otherwise have proprietary rights over a product name/logo and this must be done in each country where the product is being sold, failing which someone else can legally co-opt the name unless you can show (at least in certain English speaking common law jurisdictions) that the other party was trying to pass off its business or good/services as related to yours, which is often a difficult burden of proof to establish.
The perils of rolling out a brand or business name without undertaking proper due diligence of the trade mark register can result in high legal costs and/or significant re-branding costs. Additionally, if a party is successful in establishing trade mark infringement, the usual remedy ordered by the Court is an account of profits. In other words, all profits derived while infringing registered trade mark(s) are claimable by the trade mark holder. Accordingly, the consequences of infringing a trade mark, irrespective of whether the infringement is intentional or not, are extremely costly and can potentially result in a business entering insolvency.
Monster Energy v MLSE
The above is well illustrated by the case of Monster Energy v Maple Leafs Sport and Entertainment (‘MLSE’), which owns the NBA franchise, the Toronto Raptors. Monster argued that its logo, made up of three vertical scratch marks, is essentially the same design that the Raptors have used since 2014. The Raptors’ logo was created using a similar concept – three diagonal claw marks on a basketball. The energy drink company objected almost immediately after MLSE first attempted to register the team’s new logo design four years ago. Monster has filed similar complaints in Canada and as far afield as Peru. The two logos are pictured below:

When you apply to register a trade mark you must provide a description of the goods or services upon which you intend to use your trade mark. These goods and services are catergorised into one or more classes.
According to Gerben Law Firm, the Raptors filed 18 trademark applications around the new logo primarily in class 28, which relates to sporting goods such as basketballs. However, in 2015, Monster Energy opposed all of the applications. Notwithstandng Monster Energy being a beverage producer and trade mark protection for beverages being in class 32, the company has also taken out take mark registration for its marks in class 28 on the basis that it sponsors a number of sporting competitions, especially with respect to surfing.
The case has been before the U.S. Patent Office’s trial and appeal board since 2015 and U.S. trademark lawyer Josh Gerber has said he believes it will end with a settlement out of court. The judge hearing the case will have to decide if consumers are likely to be confused by the two logos, said Gerben. “In one case you have a very popular logo from an NBA franchise that everybody understands is Toronto Raptors. And on the other you, have a logo that everybody understands is Monster Energy. It appears on its face the logos are pretty different.” Gerben pointed out that claws are quite commonly used in trademarked logos, which may further weaken Monster’s case.
Notwithstanding that it is very unlikely that Monster Energy would prevail in its opposition given that it is highly unlikely that consumers would be confused given the high level of brand awareness of the NBA franchise and the energy drink company, the common view is that the matter will end in a commercially-minded settlement and that each party will ultimately have spent hundreds of thousands in legal fees.
Grill’d v Tender Gourmet Butchery
Another interesting example of potential trade mark infringement relates to the franchised burger chain Grill’d. A northern beaches butcher, Tender Gourmet Butchery in the Warringah Mall, rolled out new signage at this business that Grill’d has maintained infringes their registered trade mark. The Grill’d registered trade mark logo and the butcher’s signage are pictured below:

Adam Stratton, the owner of the butchery, defended his signage saying “We’re just trying to explain to people you can get carvery, or grill, or burgers there and they’ve taken offence to using the word ‘grill’,” Mr Stratton told 2GB. He said the largest sign at the store featured his business name, Tender Gourmet Butchery. “(Grill) is a pretty common word, and I didn’t realise you could trademark a common word like that,” Mr Stratton said. “It makes me feel like they’re just trying to bully me a little bit about it. “We have a smaller G, they have a capital G…We don’t have an apostrophe and a D at the end. So it’s completely different,” he told 9 News.
Given the large resources of the burger chain, Mr Stratton is likely to change his signage rather than risk incurring the costs associated with a law suit for trade mark infringement however this will not be without significant cost. “I’ve got to go through designers, through a design department in Westfield. It’s not as clear-cut for me to be able to change something so easy like that,” Mr Stratton told 2GB, illustrating the costs and other issues associated with changing a simple sign, which pales in comparison to the costs of having to do a complete re-brand.
How we can help
At Marino Law, our experienced commercial and intellectual property lawyers are able to vet proposed product names and business names as well as logos against trade mark databases in various jurisdictions in order to provide you advice as to the likelihood of infringing a registered mark as well as the prospects of being able to obtain a registered trade mark yourself. While there are some upfront costs involved in having such due diligence undertaken before rolling out a new business or product name, such costs are minute when compared to the cost of even changing a sign in a shopping centre, let alone re-branding and/or losing all profits earned as a result of a trade mark infringement law suit. Further, if your trade mark is opposed by a company such a Monster Energy or you are sued for trade mark infringement by a company like Grill’d, we can advise you on your legal position, likelihood of success in defending against the action as well as act for you in defending against any such allegations.
The post What’s in a name? The Importance of Due Diligence & Trade Mark Registration appeared first on Marino Law.

Have you recently separated from your partner?
Do you have unresolved matters which are preventing you from being able to completely move on with your life?
Are you financially tied to your partner and exposed to liabilities that will affect your credit rating and financial future?
Unresolved issues can include the division of the assets and liabilities of the relationship (irrespective of in whose name they are held). It may be somewhat unclear what the actual assets and liabilities of the relationship are.
There can also be matters relating to the living arrangements for your children to be discussed and agreed upon.
Understandably, you may wish to reach an agreement sooner rather than later, close that chapter and move on with your life (financially and personally).  These are all reasonable desires and goals.  However, the risk for you is that being blinded by the need to move on may cost you in the long run.
There are several reasons why you may want to reach mutual agreement as soon as possible. For example:

you and your former partner are still amicable or are at least communicating respectfully on some level;
your former partner is pressuring you to reach agreement telling you “it’s a good deal” and you may want that pressure to end sooner rather than later;
you may feel guilty for the reasons surrounding separation (even though we have a no-fault system);
you do not want to spend money on lawyers or cannot afford to do so;
you do not think you need legal advice because you have heard about how the family law system works from friends, family or associates and are confident that you and your partner can sort it out fairly and simply; and
you are stressed because of financial pressures such as an inability to service a mortgage or meet your day to day living costs or those of your children.

It is understandable to be a little afraid of the unknown.  Average Australian’s don’t have a regular need to consult with a Solicitor and that process can be scary.
However, we strongly encourage you to take the step to obtain early legal advice.  Bring along a support person or family member to assist in the emotional aspects of the process and come armed with questions that you need answered.
If you proceed without first seeking legal advice, there is a risk that you are proceeding not knowing your rights and entitlements.  Doing so puts you at risk that your separation will cost you a lot more in the long term (both emotionally and financially).
Experienced and knowledgeable family lawyers understand and appreciate the emotional strength it takes to consult with a lawyer after separation.  We understand that it can be daunting.  Finding the right lawyer for you is of utmost importance.
At Marino Law, we have experienced family lawyers who, through their many years of practical and legal experience, will assist you in an empathetic but clear and concise manner, in order to give you the right advice and guidance.
If you have unresolved parenting matters, our family lawyers will identify the outstanding issues and guide you as to what should be included in your parenting agreement. These issues may relate to spending time, holidays, special occasions, handovers and communication. Whatever they may be, you can rest assured that your children’s best interests will be looked after.
If you have unresolved financial matters, the Marino Law family law team will assist you to identify:

the assets, liabilities and financial resources available for division between you and your spouse or partner. This information is critical to determine what will ultimately be divided or kept by either you or your former partner;
the contributions, financial and non-financial, made by you and your former partner, during the course of your relationship;
whether you have a need for financial support on an interim basis and how to go about obtaining such support; and
whether you or your former partner have any future needs, such as care of young children, or health needs that ought to be considered.

Remember, no two cases are the same.
Investing in an initial consultation with an experienced family lawyer will provide guidance as to the process of resolving your family law dispute (including alternative dispute resolution as opposed to litigation), what is the likely range of appropriate outcomes and how to practically achieve those outcomes and give you practical guidance as to steps you need to take before you can start negotiations.
Also, our family lawyers will assess and recommend any urgent measures you may need to take to protect property or children and advise you of your legal rights generally.
Money spent early following separation on sound legal advice can return significant savings down the track.
The post Obtaining early legal advice – Why seeing a family lawyer does not spell the end of the possibility for amicable and timely resolution appeared first on Marino Law.

Marino Law is proud to announce that it is a finalist in the Regional/Suburban Law Firm of the Year category for the Australian Law Awards.
Celebrating its 19th year, the Australian Law Awards, in partnership with UNSW Law, is the pinnacle of award programs for the nation’s legal professionals, recognising individual, team and firm excellence in law, from the profession’s most senior ranks to its rising stars.
Marino Law Managing Partner, Rob Marino said it was an honour to be named among some of Australia’s highest achieving law professionals and firms across a number of categories.
“Marino Law’s inclusion within this category is recognition for the contribution our firm has made to the legal community on the Gold Coast and reinforces the strength of the brand in connecting with the community and engaging with our clients,” Mr Marino said.
The finalist list, which was announced on 24 June, features over 350 high-achieving law professionals across 37 categories.
“The Australian Law Awards is the largest and most competitive awards program hosted by Lawyers Weekly,” said editor Emma Ryan.
“The event recognises the outstanding work taking place across major legal practice areas, brilliance at the bar, legal in-house powerhouse, innovators and various firm-led pro bono programs, offering an opportunity for some of the most dedicated people in the profession to be recognised for their valuable contributions to the business of law.”
“We’d like to thank our many clients and referrers over the years for helping us achieve the position we are in today,” Mr Marino said.
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Marino Law’s Partners and Senior Associates joined more than 200 of the Gold Coast’s most high profile CEO’s and business leaders at this year’s Vinnies CEO Sleepout® on Thursday night.
The team braved cold temperatures, camping out at Cbus Super Stadium to raise money and awareness for people in Australia experiencing homelessness.
Marino Law Managing Partner, Rob Marino said the firm were the second highest team fundraisers, raising $12,876 towards the appeal, which assists the St Vincent de Paul Society (Vinnies) to provide immediate relief to people in crisis and bring to light the harsh reality faced by those who have no place to call home.
“It was a fantastic effort by the team to raise so many much needed funds,” Mr Marino said.
“Homelessness is all around us and can affect people we know and love for so many reasons, so we are pleased to contribute in this way, by placing ourselves in the shoes of the less fortunate, even if only for one night. It makes you grateful for the simple things in life.”
Of the more than 105,000 Australians experiencing homelessness every night, 42 per cent are women and 32 per cent are children.
Vinnies provides crisis accommodation to individuals experiencing homelessness, as well as advocacy support, budgeting services, living skills programs, emergency relief, transitional housing and access to programs that help rebuild lives.
This is Marino Law’s third year taking part in the fundraiser.
Thank you to those who supported us and helped us to reach our fundraising goal.
The post Marino Law raises close to $13,000 to help highlight Australia’s hidden homelessness appeared first on Marino Law.

Masson v Parsons [2019] HCA 21
Yesterday, the High Court of Australia ruled that a sperm donor was a legal parent with the inherent rights and roles that arise therefrom.
Family law issues rarely arise for determination in the High Court however an issue as unique as this was considered appropriate for consideration.
In 2006 a girl was conceived using sperm from a known donor.
The donor father remained in close contact with the family, introducing her to his family and volunteering at her school.  In Court the man was known as Robert.
The child called the donor “daddy”.  She had a sister (not the same donor father) who also called the man “daddy”.
The legal stoush between the donor and the Mother arose when the Mother, with her same sex partner, decided to move to New Zealand.
The donor father did not agree and sought to challenge their proposal in the Family Court of Australia.
At the initial trial, the donor father was successful, with the Court determining that there was more to parenthood than biology and concluding that “the children will do best if Susan and Margaret make the long-term decisions about their future in consultation with Robert. Susan and Margaret were not permitted to relocate to New Zealand.
The Mothers appealed this decision, relying upon NSW legislation which specifically dealt with the legal rights of a sperm donor in same sex IVF treatment.  They were successful in their appeal.
Robert sought and obtained leave to appeal to the High Court given the apparent conflict between the Commonwealth Family Law Act and the NSW legislation.
The Constitutional issue resulted in the Commonwealth government intervening and supporting Robert’s case and the Victorian Attorney General supporting the Mother’s case.
The High Court found, by majority that the NSW law was not applicable, and the Commonwealth definition of parent should be applied.
It stated that “the term sperm donor suggests that the man in question has relevantly done no more than provide his semen to facilitate an artificial conception procedure on the basis of an understanding that he is thereafter to have nothing to do with any child born”.  It found that those were not the facts of this case.
The successful High Court appeal returned the parents to the original Family Court orders, requiring consultation with Robert about long term issues and time arrangements.
The High Court ruling will have far reaching impacts upon donor arrangements and for this reason, it is recommended that when there is a known donor providing genetic material for IVF or Surrogacy, a known donor agreement ought to be entered.
Whilst not legally binding, the statement of intentions contained therein will have an impact on any court proceedings which may arise in the future.
Marino Law’s Family Law Partner, Abbi Golightly has extensive experience in issues relating to donor assisted fertility and all other matters pertaining to assisted reproductive technology as it impacts family law.  Contact us to discuss your needs in relation to these types of matters on 55260157.
 
 
 
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The federal government in an effort to combat illegal phoenix activity has introduced the Treasury Laws Amendment (Combating Illegal Phoenixing) Bill 2018 and the Insolvency Practice Rules (Corporations) Amendment (Restricting Related Creditor Voting Rights) Rules 2018 (collectively referred to as the ‘Combatting Illegal Phoenixing Bill’), consistent with its announcement in the 2018-19 budget to seek a package of reforms to corporations and tax laws to combat illegal phoenix activity.
What is Illegal Phoenix Activity?
In Greek mythology, a phoenix is a long-lived bird that cyclically regenerates or is otherwise born again. Associated with the sun, a phoenix obtains new life by arising from the ashes of its predecessor.
In insolvency law, illegal phoenix activity involves transferring business assets from one entity to another for either no or undervalued consideration. By doing so, a company that is in financial trouble can effectively ‘rise from the ashes’ in the form of a new corporate entity using the same assets as the insolvent company it replaced but without any of the associated liabilities or debts.
Typically, the first entity’s directors will either resolve for a creditors voluntary liquidation or they may allow a creditor of the first entity to engage a solicitor to wind it up.
Illegal phoenix activity prevents employees and creditors, not the least of which being the Australian Taxation Office, from accessing their entitlements or amounts owing to them. It is estimated to cost the Australian economy more than $5 billion a year, according to a report by the national phoenix taskforce.
The Combatting Illegal Phoenixing Bill
The government’s proposed reforms include a range of measures to “both deter and disrupt illegal phoenixing and more harshly punish those who engage in and facilitate this illegal activity”.
The draft legislation includes reforms to:

introduce new phoenix offences that target those who conduct and those who facilitate illegal phoenix transactions:

It will now be an offence for company directors to engage in creditor‑defeating transfers of company assets that prevent, hinder or significantly delay creditors’ access to those assets;
Pre-insolvency advisers and other facilitators of illegal phoenix activities will also be liable, as there will be a separate offence for any person who procures, incites, induces or encourages a company to make creditor‑defeating transfers of company assets;
These will be both criminal and civil offences, attaching the highest penalties available under the law;
The offences will be supported by an extension of the existing liquidator asset clawback avenues to cover illegal phoenix transactions.  ASIC will also receive a new regulatory tool to recover property that has been transferred under an illegal phoenix transaction;

prevent directors from backdating their resignations to avoid personal liability;
prevent a sole director from resigning and leaving a company as an empty corporate shell with no director;
extend the director penalty provisions to make directors personally liable for their company’s GST and related liabilities;
expand the Australian Taxation Office’s existing power to retain refunds where there are tax lodgements outstanding;
restrict the voting rights of related creditors of the phoenix operator at meetings regarding the appointment or removal and replacement of an external administrator; and
introduce a mandatory Director Identification Number (‘DIN’) regime for all company directors in Australia.

Notably, the bill involves four key changes to the Corporations Act 2001 (Cth), including new civil and criminal penalties for when company officers make a “creditor defeating disposition”, or allow assets to be sold or transferred in a way that could make it harder for creditors to recover debts later. Penalties being proposed include imprisonment of up to 10 years for some offences.
What’s Next?
Submissions on the legislation closed on March 26 and following this, the bill will be debated in the House of Representatives. If it passes the House, it was be sent onto the Senate for a vote. If approved by the House and Senate, it will go before the governor general for royal assent. If it is amended by the Senate, the bill will be sent back to the House for another vote.
It remains unclear whether the legislation will be passed before parliament is prorogued ahead of the general election that is widely expected to be held this May.
What will the Labor Party do if elected?
At this stage, it is not clear whether the Labor party supports the bill as a whole. Labor policy is presently to allow Australia’s tax commissioner the power to “name and shame” notorious directors of phoenix companies.
Under Labor’s proposed changes, the ATO commissioner would have the power to name and shame individuals and entities engaged in illegal phoenix activity. The commissioner would also be given the power to apply to the Australian Securities and Investments Commission for disqualification orders for directors who engaged in phoenix activity or other breaches of directors’ duties.
Further, the party supports a director identification number (DIN) regime that would require company directors to provide more information about themselves – including a 100-point identification check – to ASIC at the time of registering a company. On this aspect of the bill, there appears to be bi-partisan support with the Coalition including a DIN regime in the package of proposed reforms.
How can Marino Law Help?
At Marino Law, we are expert insolvency and restructuring lawyers who can assist you in restructuring your business operations without breaching the Corporations Act 2001 (Cth) or any other legislation. We work with your existing accountants or where you are not satisfied with them, we have a number of highly trusted and recommend accountants and financial advisors to whom we may refer you. Where restructuring occurs at arms-length after taking proper legal and financial advice, restructuring your business operations remains entirely legal. Further, risk involved in the process to the company’s directors can be effectively mitigated by taking proper legal and financial advice and developing a restructuring strategy at an early stage.
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In certain circumstances, company directors can be personally liable for the amount of any employee superannuation entitlements owed to the company’s employees. As a consequence of amendments relating to the Director Penalty Notice (“DPN”) regime made pursuant to the Treasury Laws Amendment (2018 Measures No. 4) Bill 2018 (Cth) (the “Bill”), which received royal assent on 1 March 2019, directors will now be even more accountable for non-payment of employee superannuation entitlements.
Director Penalty Notices
A director becomes liable to a penalty as a consequence of a company’s failure to pay employee superannuation entitlements at the end of the day those obligations are due to be met by the company i.e. within 1 month and 28 days after the end of each quarter (the “Due Date”). The Commissioner of Taxation is not required to issue a notice to the director to create that penalty, however, proceedings cannot be commenced against the director to recover that penalty until 21 days have elapsed since the issuance of a DPN.
Under the DPN regime that existed prior to 1 March 2019, there were two (2) types of DPN’s; a Non-Lockdown DPN and a Lockdown DPN.
Under a Non-Lockdown DPN, a director could avoid personal liability for unpaid employee superannuation entitlements if, within 21 days of receipt of the DPN, the amount of the entitlement was paid to the ATO or an administrator or liquidator was appointed to the company.
Under a Lockdown DPN, a director is automatically liable for the unpaid employee superannuation entitlements. A Lockdown DPN was generally issued to a company director where the company to which he or she has been appointed failed to lodge its superannuation guarantee statement within three (3) months of the Due Date.
As a consequence of the above matters, a director was able to effectively wait until just before the “lock down” date, being three (3) months after the Due Date, to place their company into voluntary administration or liquidation and avoid being personally liable for the unpaid employee superannuation entitlements.
Pursuant to the Bill, liability for unpaid superannuation entitlements will now be “locked down” on the Due Date and not the previous three (3) month period from the Due Date. Accordingly, for a director to avoid personal liability for unpaid employee superannuation entitlements he or she would have to appoint an administrator or a liquidator to the company before the Due Date or pay the amount of those outstanding entitlements before the Due Date.
Criminal Penalties
The Commissioner of Taxation has now been provided with powers, pursuant to the Bill, to pursue criminal penalties for serious contraventions of a company’s obligations to pay employee superannuation entitlements. Those penalties can include terms of imprisonment for directors. Previously, the Commissioner of Taxation was only able to collect financial penalties, including the superannuation guarantee charge and interest in such circumstances.
 Conclusion
As the financial ramifications that a director can be exposed to as a consequence of the issuance of a DPN can be substantial, directors should seek immediate legal advice should they receive such a notice from the ATO.
Marino Law has extensive experience acting for directors, liquidators, administrators, lenders, financiers and creditors in the administration of all corporate insolvency appointments. Our highly experienced lawyers regularly advise clients in the following areas of corporate insolvency:

director penalty notices;
voluntary administrations;
liquidations;
voidable transaction claims pursuant to part 5.7 of the Corporations Act 2001 (Cth);
enforcement of securities; and
statutory demands.

Should you require assistance in any of the above areas, please contact one of our highly experienced lawyers.
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Every person, at some stage of their lifetime, will be required to participate in a negotiation to give effect to a contract, agreement or another type of transaction.
Examples include:

The sale or purchase of real or personal property or businesses;
The taking of any kind of lease (residential, commercial or otherwise);
Obtaining a loan;
Employment matters;
Development, building or sub-contractor agreements; or
Another type of agreement or transaction.

Often, these negotiations occur in an informal manner and without the involvement of legal representation, with both parties believing that until the final terms have been agreed, either party can discontinue the negotiations at any time, without consequence. The following case examples demonstrate that this not true and in some cases, those negotiations can be binding on the parties.
Relevant case examples
Case 1 – Stellard Pty Ltd v North Queensland Fuel Pty Ltd[1] (“Stellard”)
This case involved negotiations between a Buyer and Seller for a service station business and the freehold land on which it was situated. The majority of the commercial terms were agreed, including purchase price, deposit, stock value, settlement date and some ‘matter specific’ terms regarding the fuel tanks and environmental matters.
Negotiations primarily took place by telephone and email and a draft contract was circulated.
The Buyer communicated acceptance of its offer by email, “subject to contract and due diligence” and asked for confirmation of acceptance by the Seller so that due diligence enquiries could commence. The Seller confirmed “subject to execution of the contract”.
The Seller subsequently received a higher offer and sought to withdraw from further dealings.
The Court did not permit the Seller to do so and found in favour of the Buyer, noting that the intention of the parties was to be bound to the agreed upon terms, despite that the formal Contract was not signed and would follow thereafter.
The Seller argued the fact that it was negotiating with other purchasers should be a clear indication that it could not have any intention to be bound to the agreement with the defendant. The Court rejected this argument, finding instead that fact alone was insufficient to override the overwhelming language and conduct of the Seller, which evinced an intention to be bound.
Case 2 – Vantage Systems Pty Ltd v Priolo Corporation Pty Ltd[2] (“Vantage”)
This case was in respect of a Landlord and Tenant, negotiating a proposal for a new lease. A written offer to lease setting out the proposed commercial terms was circulated and negotiated.
Both parties accepted the terms of the written offer to lease, which contained a clause that effectively made the proposal “subject to formal lease documentation being prepared”.
The lease documentation was circulated and further negotiations took place between the parties, before the Tenant sought to withdraw from negotiations because certain provisions of the Lease were unsatisfactory to it.
The Court in first instance found the written offer to lease contained all of the required terms and each party’s conduct in the negotiations demonstrated a “meeting of the minds” sufficient to create a legally binding relationship, despite no formal lease existing between them.
The Tenant appealed on the basis that the offer was “subject to the Lease” and that the terms of the Lease were not fully agreed upon.
The Court of Appeal upheld the finding at first instance, indicating that the written offer to lease contained all of the necessary terms to form a contract and that document was accepted by both parties. The Court concluded that the terms in the Lease that were not present in the offer, as well as the subsequent negotiations, dealings and communications were not inconsistent and did not destroy the earlier concluded (and binding) agreement as set out in the offer to lease.
The Court of Appeal also considered circumstantial evidence to infer the parties’ intentions. The fact the Tenant had been in occupation for a significant time under a previous lease (6 years in total), the parties familiarity through prior dealings and the Tenant’s familiarity with the suitability and capabilities of the land (for the freehold purchase) were all relevant to the Court’s decision.
Leading case on contract formation
Masters v Cameron[3] is the leading case on contract formation in Australia. It suggests that if the parties have reached “an agreement to agree” or an agreement that is subject to the preparation or formation of a more formal document, that agreement may fall into one of three categories:

All terms are finally agreed and the parties intend to be immediately bound, with the terms to be restated in a fuller or more precise way;

The parties have agreed on all terms, with performance conditional upon a formal contract;

The parties do not intend to conclude a bargain, unless or until a formal contract is executed.

The effect of Masters v Cameron is that unless a party to negotiations has clearly and unequivocally communicated to the other that they do not intend to be bound to the transaction unless or until a formal document has been executed, it is possible for that party to be held to a binding and enforceable agreement, even where the negotiations phase is not completed or where a contract has not been prepared or signed.
In both Stellard and Vantage, the Courts found that all of the key terms of the agreements had been agreed, with that agreement to be subsequently recorded in a more formal contract. In both cases, it was irrelevant that the formal contract contained additional provisions that do not affect the substance of the original agreement.
Stellard’s case is interesting because in most jurisdictions in Australia, legislation exists that requires a contract for the sale of land to be recorded in writing and signed,[4] as well as a requirement for consent to be given before contracts are supplied or signed by electronic means.[5] Regardless, the Court determined the particular email acceptances in Stellard’s case complied with the legislative requirements in Queensland.
Essential takeaways
The following are recommended guidelines for dealing with any negotiations, regardless of the subject matter:

The overall conduct of the negotiations, as well as the express language used (whether oral or written) must be chosen with extreme care. A Court will not hesitate to look at all communications or negotiations between the parties to determine their ultimate intentions.
A party should avoid the use of words that could be inferred as an acceptance, an agreement or otherwise construed as a meeting of the minds (whether conditional or unconditional), especially where they convey an express or implied sense of conclusion or finality.
From the outset, the intention of a party should be communicated to the other as to whether that party intends to be bound immediately, or not bound until the final contract has been executed.
Legal advice should be sought at the earliest available opportunity, to avoid any unintended consequences for either party and minimise the risk of expensive litigation.
A preliminary agreement (such as an expression of interest, offer to purchase, offer to lease etc) should never be signed without proper legal advice.
An agreement can still be binding where its main terms have been agreed upon, other terms have not been, provided they do not change the material agreed upon terms. The greater the number of unagreed terms (or the more ambiguity that exists surrounding them), the less likely the Courts will be to infer that a binding agreement is in place.

How can Marino Law help?
Marino Law has extensive experience in all contractual negotiations and our team of expert commercial lawyers can effectively guide you through the negotiation and document preparation process, up to the ultimate conclusion of your intended transaction.
For a no obligation quotation and prompt practical advice, please contact one of our expert commercial lawyers today.
 
[1] Stellard Pty Ltd v North Queensland Fuel Pty Ltd [2015] QSC 119.
[2] Vantage Systems Pty Ltd v Priolo Corporation Pty Ltd [2015] WASCA 21.
[3] Masters v Cameron (1954) CLR 353.
[4] In Queensland, see s.59 of the Property Law Act 1974 (Qld).
[5] In Queensland, see s.13 and s.14(1)(c) of the Electronic Transactions (Queensland) Act 2001 (Qld).
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This is a topic that is sure to generate conversation at family get-togethers and backyard barbecues.  The statement “I earned it, I should be able to leave it to whoever I like” is one that is commonly made.
When people think about a will being contested, they think about the court changing the way the estate assets of a decedent are distributed.  In legal jargon, this is called a ‘family provision application’, which may be made even though a will is otherwise valid.  Family provision applications are, however, just one of a number of situations in which wills may be contested, which include:

Where the testator (the maker of the will, the deceased) has not made adequate provision for certain family members – family provision applications;
Where the formal requirements for making or amending a will have not been met;
Where the will does not reflect the testator’s testamentary intentions or not all provisions in a will achieve their purpose;
Where the testator did not have testamentary capacity to make the will, that is they did not understand the nature of the document they were executing;
Where the testator was subjected to undue influence from another person; and
Where there is a will contract where, for example, the testator may have agreed to leave a person a gift in their will in return for that person giving something to the testator, which is an enforceable contract.

Whilst each of the above can result in an application being made to court to either set aside, interpret, correct or enforce a provision in a will, this article will focus on family provision applications.
Family provision applications are becoming more common for two main reasons:

People are dying with more assets than they used to in the past, which is a function of people living longer, giving them more time to accrue assets and superannuation, which although generally not an estate asset (an asset that can be gifted by will), is often used to purchase estate assets after retirement; and
The increase in the number of blended families, which increases the number of children and grandchildren and also the complexity of family relationships.

The court’s authority to interfere in the distribution of a decedent’s assets derives from statute and each State in Australia has legislated to require a person to make adequate provision for certain family members.  From a historical perspective, this echoes the law going back to Anglo-Saxon times, which provided that on death one third of a man’s (women didn’t own assets) estate would devolve to his wife, another third would devolve to his children and he could distribute the final third as he saw fit.
In Queensland, section 41(1) of the Succession Act 1981 (Qld) relevantly provides:
If a person dies without making adequate provision from their estate for the proper maintenance and support of their spouse, child or dependant, the court may order that provision be made as it sees fit.
Spouses include de facto partners and parties to civil partnerships.
‘Child’ includes any child, stepchild or adopted child of the deceased and also includes adult children.
‘Dependant’ encompasses any person who was being wholly or substantially maintained or supported by decedent, and can include grandchildren and non-relatives.
The factors the court will consider when deciding whether to make a family provision order include:

The size of the estate:  the estate may simply not be big enough to make provision from;
The means and financial responsibilities of the applicant:  they may not need a provision from the estate;
The relationship of the applicant to the deceased:  the applicant may not receive a provision if they have been estranged from the deceased for a long time;
Contribution by the applicant to the estate:  such as where the applicant assisted the deceased to accrue their estate;
Financial need:  for education, unemployment, illness; and
Disentitling conduct:  adultery, desertion, chronic drunkenness.

However, none of the above factors are black and white.  The court has a broad discretion and will investigate the circumstances of each application thoroughly.
In short, if a close family member has passed away and you did not receive an allocation from their estate, where it would normally have been expected that a person in your relationship would have received an allocation, or a better allocation, you should see us now to consider your ability to make a family provision application.
Alternatively, if you an executor of a will and find yourself a respondent to a family provision application, you should also see us as soon as possible so that we can advise you on the appropriate course of action.
If you do think there is a basis for you to make a family provision application, you should act now as there are time limits within which you have to act.
Alternatively, if you are concerned whether your will might be susceptible to a family provision application, you should also see us to discuss steps you might take to reduce the likelihood of this situation occurring.
Marino Law has extensive experience acting for both applicants and respondents to family provision applications, and other estate litigation matters.  Should you require assistance in relation to a family provision application, or other estate litigation matter, please contact one of our highly experienced litigation lawyers.
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Commissioner Kenneth Hayne’s Final Report in the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (the “Final Report”) was presented to the Governor-General on Friday 1 February 2019. The Honourable Josh Frydenberg publicly released the Final Report on Monday 4 February 2019.
The Final Report contained a number of recommendations that were directed at the Australian Securities and Investment Commission (“ASIC”). In particular, one of those recommendations relates to the approach that ASIC takes with respect to its regulatory and enforcement practices.
As a consequence of ASIC’s response to those recommendations, company directors who breach their obligations under the Corporations Act 2001 (Cth) (the “Act”) can expect a tougher response from ASIC with respect to such breaches.
ASIC and Enforcement
Pursuant to the Final Report, Commissioner Hayne damned ASIC’s enforcement culture as ineffective. Commissioner Hayne criticised ASIC’s widespread use of enforceable undertakings and administrative actions when dealing with large scale legal breaches stating that ASIC had an entrenched culture of negotiating outcomes rather than pursuing punishment for wrongdoing.
According to the Report, Commissioner Hayne found that ASIC rarely went to Court to seek public denunciation of and punishment for misconduct.
ASIC’s Response
In a public statement dated 4 February 2019, ASIC chairman, James Shipton welcomed the Final Report and advised that ASIC would, in particular, consider the Final Report’s recommendations on ASIC’s regulatory and enforcement practices. Mr Shipton advised that those recommendations accorded with ASIC’s recent adoption of a ‘why not litigate?’ approach to enforcement.
Company directors ought be aware that, as a consequence of the recommendations made against it in the Final Report, ASIC may now be more likely to seek the Court’s intervention with respect to breaches of the Act that it may have previously sought to resolve through the negotiation of an enforceable undertaking for instance.
Relevant legislation
Accordingly, ASIC may now be more likely to prosecute directors for breaches of the Act including, for example, the following:

the duties imposed on directors at sections 180 and 181 of the Act with respect to exercising their powers with due care and diligence and for a proper purpose;
the duties that directors owe with respect to the keeping of books and records at section 286 of the Act; and
the duty on directors at section 588G(2) of the Act to prevent the company they are appointed to from incurring debts while that company is insolvent.

If, subsequent to a prosecution initiated by ASIC, a Court is satisfied that a director has for example, in breach of section 588G(2) of the Act, allowed the company to which he or she is appointed to trade whilst insolvent, pursuant to sections 1317E and 1317G, the Court may order that director to pay to the Commonwealth a pecuniary penalty of up to $200,000.00. In addition to the pecuniary penalty, the Court could also order that that the director pay compensation to any creditors that have suffered financial loss as a consequence of the company having incurred debts to those creditors whist the company was insolvent.
How can Marino Law help?
As the financial ramifications to which a director can be exposed as a consequence of any breach on their part of the above provisions of the Act can be substantial, directors who may be investigated or prosecuted by ASIC should seek immediate legal advice.
Marino Law has extensive experience acting for and against company directors. Our highly experienced corporate litigation lawyers regularly:

advise clients with respect to the duties that directors owe to the companies to which they are appointed and the potential consequences and ramifications that may follow such breaches;
defend directors with respect to proceedings commenced against them for breaches of the Act;
act for liquidators against company directors with respect to breaches of the Act; and
advise clients and appear at public examinations brought against directors by liquidators and ASIC.

Should you require assistance in any of the above areas, please contact one of our highly experienced corporate litigation lawyers.
 
 
 
 
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Separation can be tough. There’s lots to consider and it’s important to know where you stand. We’ve come up with a list of the basic things you need to know to help you ensure you get your fair share.

We have separated and I want to come to an agreement with my former partner regarding our joint property. Where do I start?

The starting point is to make a list of all current assets, liabilities and superannuation interests of the parties to the separation. This allows for the “net property pool” to be identified. The next step is to determine the value of the net property pool. In undertaking this exercise it may be necessary, for reason of complexity or dispute, to appoint an independent valuer/valuers to determine the value of certain items in the property pool. This will often be the case when dealing with assets such as real property and interests in a business/company.

What can I do if my partner looked after all the finances and I can’t be sure that I have knowledge of all assets and liabilities of the relationship?

It is the obligation of each party to a property settlement matter to provide to the other full and frank financial disclosure. This obligation subsists from the commencement of negotiations through to finalisation of property settlement matters, either by way of agreement being reached or Orders being made by the Court.
In most cases, parties are agreeable to making voluntary disclosure as to their current financial circumstances. In the minority of cases where a party is obstructive to the disclosure process, Court proceedings can be commenced and a subpoena issued seeking production of documents from a third party to ascertain financial information. These third parties are commonly banks, accountants, etc.

Is Superannuation included in the property pool?

Yes. Superannuation is treated as property for the purposes of calculation of the net property pool and during the course of property settlement negotiation. The Family Law Act 1975 (Cth) (the ‘’Act”) provides for the “splitting” of Superannuation interests as between separated parties, while the Family Law (Superannuation) Regulations 2001 provide the methods by which superannuation interests are valued and superannuation splitting orders effected.

Is there a presumption that property is divided 50/50 between separated parties?

No. There is no general rule or presumption that property is, or should be, divided equally when a relationship ends. In some cases an equal division will arguably be fair, just and equitable. In other cases property adjustment other than 50/50 is required to effect a just and equitable outcome.

If we can’t reach agreement, what next?

If early property settlement negotiations become difficult or are unsuccessful, it may be appropriate to consider Mediation. Mediation can assist separated couples to reach agreement with the assistance of an independent and neutral party, being the Mediator.
Mediation is certainly a worthwhile process and can be particularly effective in cases where the property pool is relatively small and/or the parties to the separation have been negotiating and are not “too far apart” in those negotiations and/or the communication as between the parties is not good or has broken down during the course of the early negotiations.

How will my property matter be determined if we have to go to Court?

Courts have a wide discretion to weigh up the different contributions of parties to a marriage or de-facto relationship.
Firstly the Court must determine whether it is just and equitable for there to be orders made adjusting the property interests of the parties. If so, Section 79(4) of the Act gives the Court power to make orders in property settlement proceedings having regard to various categories of contribution including direct and indirect financial contributions, direct and indirect non-financial contributions and contributions to the welfare of the family and/or children. Each of the categories of contribution is weighed and assessed by, and at the discretion of, the Court on the facts of each case.
Following an assessment of the categories of contribution the Court will consider the future needs of the parties taking account of such factors as disparity in income earning capacity, general capacity to engage in meaningful employment, health difficulties, parenting arrangements, etc. The final step is for the Court to make an overall assessment that in all the circumstances of a particular case it is just and equitable to make the proposed property settlement orders.
How can Marino Law help?
Our team of experienced family lawyers can assist with all aspects of your family law requirements. Contact us today.
 
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Children of separated households have often experienced significant grief, trauma and possibly conflict in their lives.
Hopefully, with careful guidance and child focus, parents are able to navigate their parenting arrangements post separation without too much conflict, however, the experience of grief and loss is mostly unavoidable.
How the Court then deals with the tragic death of a parent when there is a surviving biological parent and a step-parent is something that requires fine balance and careful consideration.
The manner in which such disputes are resolved also depends on whether or not there are existing Orders in place between the parents at the time of one of their passing.
It is commonly believed that if there are parenting Orders in place and one of the parents passes away, the other parent automatically has the “right” to say that the child ought to come and live with them.
This is not in line with the Family Law Act 1975 (Cth) (the ‘’Act”) which in fact says the exact opposite.
Relevant legislation
Section 65K of the Act deals with this circumstance and states:

This section applies if:

A parenting order is in force that provides that a child is to live with one of the child’s parents; and
That parent dies; and
The parenting order does not provide for what is to happen on that parent’s death.

The surviving parent cannot require the child to live with him or her.
The surviving parent, or another person (subject to s65C), may apply for a parenting order that deals with the person or persons with whom the child is to live.
In an application under subsection (3) by a person who does not, at the time of the application, have any parental responsibility for the child, any person who, at that time, has any parental responsibility for the child is entitled to be a party to the proceedings.

Therefore, in the tragic circumstances of the death of a parent the subject of parenting Orders (particularly the parent with whom a child lives), it is not a foregone conclusion that the child or children will just go and live with the surviving parent.
Any person concerned with the care, welfare and development of a child can make an application to the Court to argue that the best interests of the child are best served by them living with a person other than their surviving parent.
Whilst s65K deals with the circumstances whereby there are existing parenting Orders at the time of death, what then is to occur when there are no parenting Orders in place?
Relevant case examples
The Federal Circuit Court of Australia has had to consider this scenario and commented upon the legal and practical considerations arising from same in the decision of Hearn & Sempers [2017] FCCA 3357.
The factual background of Hearn & Sempers [2017] FCCA 3357 is as follows:

Until 2016 a young man (aged 13 at the time of hearing) was living in a happy and settled arrangement with his mother, step-father and younger brothers. The mother and step-father had been in a relationship since the boy was 18 months old and accordingly had the benefit of two father figures in his life, both of whom he called “dad”.
His parents had separated prior to his birth and after a short dispute regarding paternity, arrangements were made between them such that the boy and his father had regular and meaningful time with one another. There were no Court Orders in place, with the parents able to agree between themselves on these arrangements, taking into account the distance between them and the Father’s employment in the Defence Force.
In late 2016 tragedy struck and the mother passed away in a motor vehicle accident
Shortly after the Mother’s funeral the biological father advised the step-father that he expected the child to live with him commencing prior to the 2017 school year.
The step-father did not think that this was in the child’s best interests, considering that remaining in his current living arrangements was what was best.

Litigation inevitably ensued between the two men.
The Court, whilst not critical of the biological father for making the request of the step-father, thought that perhaps the conversation, within days of the Mother’s funeral and after a meeting at the commencement of the child’s first day back at school, could have been better expressed.
The biological father suggested a reversal of the long standing arrangement, with the child living with him and spending time with his step-father and family.
The Court equally was not critical of the step-father’s view that the child ought to remain with him and his half siblings.
The Court considered the step-father had standing pursuant to s65C(c) of the Act to seek parenting orders (as he is a person concerned with the care, welfare and development of a child).
The Court confirmed that paternity does not give a person priority in a parenting dispute, quoting an older decision of Rice & Miller which stated:
The fact of parenthood is to be regarded as an important and significant factor in considering which of the proposals best advances the welfare of the child.  We would reiterate, however, that the fact of parenthood does not establish a presumption in favour of the nature parent nor generate a preferential position in favour of that parent from which the Court commences its decision making process.  Each case must be determined according to its own facts, the paramount consideration always being the welfare of the child whose custody is in question.
The child’s views and wishes were explored via a Family Report and it confirmed that the child wished to remain in the care of his step-father and spend time with his biological father.  The child’s views were considered to be his own and not altered by any influence of his step father or extended family.
When arriving at its conclusion, the Court made the following comments:

The two people contending for the child living with them are both good men, a situation the court rarely has before it.
Considerable weight ought to be given to the child’s views.
To impose a significant change on the child after only losing his mother 12 months ago would be harsh, given that it would take him away from his bothers, his mates, his extended family, his school, all his familiar haunts, to a place where he had no relatives other than his father.
The father is a very important figure in the child’s live, which made him a very lucky boy as most children in his situation where the parents had a fleeting relationship did not have such an involved father.
The father may feel that it is natural that his son should live with him, but as the Court made clear, biological connection does not solely determine the parenting matter.

The Court determined it was in the child’s best interests to remain living with his step-father and to spend time with his father during school holidays and for other times when the father travelled to where the child lived.
The Court ordered both men to have equal shared parental responsibility for the child.
This case highlights that the Court places significant weight on other persons important to a child when determining a parenting matter.  Biology is but one thing but arguably not the most important one.
How can Marino Law help?
Where possible, it is advisable to make provision in your estate planning for the living arrangements you desire for your children if you were to pass away.  Whilst not binding on the Family Courts it is a statement of intention that the Court can rely upon when weighing up the competing applications.  A statement in a Last Will and Testament about who you wish to be the guardian of your infant child or children may be the strongest way you can put your case forward after your passing.
Non-parent caregiver cases are significantly complex and require expert consideration and advice.  Marino Law is excellently placed with both estate planning departments and family law departments to ensure that your wishes for the living arrangements of your children are expressed in as strong a way as possible.  Your estate planning can also authorise the use of funds from your estate for litigation around children’s living arrangements, should that be necessary.
Should you wish to obtain further advice regarding your wishes for your children after your passing, contact Marino Law without delay.
Further, if you are involved in a parenting matter or need assistance and advice regarding your options to seek parenting orders if you are a non-biological caregiver, our Family Law team are available for appointments with haste and will guide you in the right direction.
The post When tragedy strikes – the impact of death of a parent after separation appeared first on Marino Law.

A New South Wales coronial inquest into the death of a father and daughter yesterday recommended a change in police procedures when they receive reports of a child not being returned pursuant to a parenting plan or court order.
Currently those matters are often considered civil matters until a recovery order is issued by the Family Law courts and directed towards the Australian Federal Police. Accordingly, parents are then required to make an urgent application to the Court for the issuing of such an Order.  The request for urgency is then considered by the Registrar of the Court and the matter can be listed as soon as the next day or sometimes up to 3 – 4 weeks thereafter, depending on the circumstances.  These types of applications come at a significant cost also, which is often out of the reach of parents.  A delay of some weeks is unbearable for a parent who’s child has not been returned to them and they have fears for their safety.
In 2014 the tragic circumstances of Gregory Hutchings and his daughter Eeva came to light when he did not return her to her mother on 11 January 2014 in accordance with their agreement.
Magistrate Teresa O’Sullivan yesterday found that Mr Hutchings ended his daughter’s life prior to taking his own.  Their bodies were found over two weeks later.
When Eeva was not returned, her Mother contacted NSW Police and registered the concern, but records indicated it was noted by the NSW Police as a “custody issue”.   It was not until the next day that an alert was issued by the Police about Eeva’s disappearance.
Magistrate O’Sullivan, whilst not being critical of the NSW Police service, did recommend that their standard operating procedures and handbook be amended so that any child not returned pursuant to a parenting plan or court order is immediately treated as a missing person.
It is hopeful that such a recommendation is taken up nationwide, such that this tragic circumstance can be avoided in the future.
If your child or children have not been returned to you pursuant to an order or agreement, it is vital to take urgent steps to seek a recovery order.  The Family Law team at Marino Law are available to assist with utmost priority given to such matters.  Contact us on 55260157.
Original article: https://www.couriermail.com.au/news/regional/inquest-finds-father-ended-girls-life-before-taking-his-own/news-story/e4ffd4835c60f38ccc517619073916a8?fbclid=IwAR1QrN7N2y3aI8hUatq-lt0ihZOq0xOi4y3QsMV2W-N7tY_PoiTVrzcLIkA
 
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