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101 Succession Answers (NSW)

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Following an author review new cases have been added and other enhancements made to the By Lawyers Reference Manual 101 Succession Answers (NSW).

Nobarani v Mariconte [2018] HCA 36

This case supports the requirement of an ‘interested’ party wishing to challenge the validity of a will to show that they have rights which will be affected by the disputed grant of probate or administration.

Re Estates Brooker-Pain and Soulos [2019] NSWSC 671

Considerations regarding disclosure of documents and information in contested probate proceedings were extensively discussed. This case analysed the applicable law, practice and procedure in the context of applications to set aside subpoenas and notices to produce which called for documents relating to the making of the disputed wills. This included solicitors’ notes and files. The interplay between subpoenas, the court’s Practice Note SC Eq 11 and case management orders was examined in detail.

The court addressed the determination of ‘legitimate forensic purpose’ in such cases, especially where pleadings had not closed and the issues in dispute were uncertain. This decision has therefore been added to the By Lawyers Reference Manual 101 Subpoena Answers too.

The court also commented on the practice of sending ‘Larke v Nugus’ letters to ‘…a person involved in the preparation or execution of a will…[seeking] disclosures about the circumstances in which a will was prepared or executed’.

Application of NSW Trustee & Guardian; Estate of Dudley Keith Vaughn [2019] NSWSC 850 and In the Estate of Hansie Hart [2019] ACTSC 317

These two recent cases each dealt with issues relating to the presumption of death.

Gregory Joseph Mills as trustee v Julie Elizabeth Mills and Ors [2018] NSWSC 363

This case is instructive as to the considerations the court applies when giving judicial advice and determining construction issues on testamentary trusts.

Finnegan & Anor v Garner & Ors [2019] QSC 100

Here the estate faced claims which, if they were resolved by litigation would result in the estate being consumed by legal costs. The court noted, at [10], that:

It is the duty of trustees of the estate not to embark upon expensive litigation which will have the effect of depleting the estate. In Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar The Diocesan Bishop of The Macedonian Orthodox Diocese of Australia and New Zealand Gummow ACJ, Kirby, Hayne and Heydon JJ said that: “a trustee who is sued should take no step in defence of the suit without first obtaining judicial advice about whether it is proper to defend the proceedings.”

Koellner v Spicer [2019] NSWSC 1571

On a family provision claim, an adult child with a medical condition and meagre financial resources was awarded a 35% legacy from the reasonably small estate even though the deceased had expressly excluded him on the basis they had no relationship.

Grant v Roberts; Smith v Smith; Roberts v Smith; Curtis v Smith [2019] NSWSC 843

The court emphasised, including by reference to the ‘overriding principles’ of the Civil Procedure Act, the duty on parties to contain costs in family provision litigation. The court heavily criticised disproportionate costs being incurred.

 

Like all By Lawyers Reference Materials, 101 Succession Answers (NSW) is updated regularly to cover developments in case law and procedure.

Presumption against bail – WA

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A presumption against bail has been created via recent amendments to the Bail Act 1982 (WA). There is now a presumption against bail for those charged with terrorism offences. This brings WA into line with other states.

The Bail Amendment (Persons Linked to Terrorism) Act 2019 (WA) amends the Bail Act 1982. Its purpose is the implementation of the 2017 Council of Australian Governments agreement for a presumption against bail to apply to persons with links to terrorism. A presumption against bail now applies in WA in relation to certain ‘terrorism offences’ and for ‘persons linked to terrorism’, as newly defined in s 3 of the Bail Act.

A person has links to terrorism for the purposes of the Bail Act if:

  • they are charged with, or have been convicted of, a terrorism offence; or
  • they are subject to an interim control order or confirmed control order made under the Criminal Code Act 1995 (Cth); or
  • they have been the subject of a confirmed control order within the last 10 years.

It is not necessary for these links to terrorism to have any connection to the charge currently before the court for which bail is being considered.

The amendments commenced on 1 January 2020.

The full commentary in the By Lawyers Criminal Magistrates Court guide for Western Australia has been updated accordingly.

Contract of Sale of Land – VIC

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With the LIV contract not currently available through LEAP, the By Lawyers Contract of Sale of Land is available to all LEAP users until 1 March 2020. Beyond that date it will remain available to LEAP users who have By Lawyers as a companion product to their LEAP subscription. It can also be accessed by non-LEAP users through the By Lawyers website by subscribing to our Victorian Conveyancing Guide, which has many associated benefits such as full access to 1001 Conveyancing Answers.

Adapting to the use of the Russell Cocks authored By Lawyers contract should present few problems as Russell was the principal author of the LIV contracts, including the 2008 version which effectively overhauled the previous contract and established the current format, making the terms of the By Lawyers contract familiar and making numerous improvements.

The By Lawyers Contract of Sale of Land for Victoria was introduced on 1 March 2018 and its use has been increasing steadily among Victorian legal practitioners and conveyancers. The By Lawyers contract removes the need for special conditions other than those covering special circumstances. It has a number of other advances over the LIV contract which further simplify the conveyancing process.

The By Lawyers legal and editorial teams ensure that the contract is immediately brought up to date with any changes in law or practice.

Recent amendments to the By Lawyers Contract of Sale of Land – Parts 1 and 2.

  • The ‘Payments’ section in Part 1 of the By Lawyers Contract of Sale of Land (VIC) has been amended for clarity regarding payment of GST;
  • A new clause has been added to Special Condition 14(f) of Part 2 which attaches a Flight v Booth type test to the purchaser’s ability to end the contract for unsatisfactory pest or building report;
  • The time for settlement has been moved from 3 pm to 4 pm to reflect current practice.

For further information see our previous post Seven reasons to use the By Lawyers contract.

Land tax – VIC

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Land tax Victoria – Absentee owner surcharge

The land tax surcharge where applicable to Victorian property increases from 1.5% to 2% with effect from 1 January 2020.

The By Lawyers  Victorian Conveyancing publications, as well as the Trusts publication, have been updated accordingly.

By Lawyers wish everyone a happy holiday season.

Land tax – NSW

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Land tax NSW – Increases to threshold values

Land tax thresholds are indexed to rise on 1 January each year.

The 2020 threshold combined land value will increase to $734,000 for all liable land. Special trusts and non-concessional companies are excepted.

A marginal tax rate of 1.6% of the aggregate taxable value above the tax-free threshold plus $100 applies.

If the aggregate taxable value exceeds the premium rate threshold of $4,488,000 then $60,164 is payable plus a marginal tax rate of 2% over that amount.

All relevant commentary and precedents in By Lawyers Conveyancing & Property Guides have been updated accordingly.

By Lawyers wish everyone a happy holiday season.

 

Paid parental leave – Fed

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Employment law – Paid parental leave amendments

The Paid Parental Leave Amendment (Work Test) Act 2019 has made the following changes to the ‘work test’ under the Paid Parental Leave Act 2010:

  1. The insertion of s 33(2A) which provides for the work test period for a pregnant woman in an unsafe job. The period begins 13 months immediately before the woman had to cease work if the cessation was due to the hazards connected with her work posing a risk to the pregnancy; and
  2. The permissible break in the work test period provided for in s 36 has increased from 8 weeks to 12 weeks between two working days.

These amendments commence form 1 January 2020.

The By Lawyers Employment Law commentary has been updated accordingly.

By Lawyers wish everyone a happy and safe festive season.

Testamentary discretionary trusts – Foreign person – NSW

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Testamentary discretionary trusts holding residential property – Surcharge duty and land tax

Where a foreign person acquires or holds residential property, duty and land tax surcharge can apply. Foreign person surcharge duty and land tax can also apply to testamentary discretionary trusts where foreign persons are beneficiaries or potential beneficiaries.

The NSW Commissioner of State Revenue issued a ruling in March 2017 allowing exemption of discretionary trusts from surcharge duty and land tax if the trust deed was amended to exclude foreign beneficiaries within six months of the exemption being granted.

The State Revenue Legislation Further Amendment Bill 2019 is currently before the NSW Parliament. If this Bill is passed, the ability to amend a trust deed to avoid the surcharge will be restricted. Once the Bill passes, the exemption is likely to be removed. The second reading speech for the Bill states: ‘the Government considers that the end of 2019 allows sufficient time for any remaining trustees and their advisers to make necessary changes to trust deeds’.

There is two-year period of grace, from the commencement of the proposed new s 104JA of the Duties Act 1997. During that period, the trustee of a testamentary discretionary trust will not be deemed a foreign person if the deceased was not a foreign person, even if the trust does not prevent a foreign person from being a beneficiary of the trust.

In order to avoid the application of surcharge duty and land tax, the By Lawyers wills creating testamentary discretionary trusts and library of testamentary discretionary trust provisions include a clause titled ‘Foreign beneficiaries’ that prohibits the trustee from making trust distributions to, or otherwise benefiting, a foreign person. The clause must also prohibit an amendment that has the effect of including a beneficiary or potential beneficiary who is a foreign person. Where it is intended for a foreign person to benefit under a testamentary discretionary trust, this clause should be appropriately amended or removed when drafting the will.

It is important to review existing testamentary trust provisions arising under a will and consider whether it is necessary to amend to avoid the application of surcharge duty and land tax.

See the commentary in the Wills (NSW) Guide for further details.

Trusts – Foreign person – NSW

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Discretionary trusts – foreign person

Where a foreign person acquires or holds residential property, duty and land tax surcharge can apply. Foreign person surcharge duty and land tax can also apply to discretionary trusts where foreign persons are beneficiaries or potential beneficiaries.

The NSW Commissioner of State Revenue issued a ruling in March 2017 allowing exemption of discretionary trusts from surcharge duty and land tax if the trust deed was amended to exclude foreign beneficiaries within six months of the exemption being granted.

The State Revenue Legislation Further Amendment Bill 2019 is currently before the NSW Parliament. If this Bill is passed, the ability to amend a trust deed to avoid the surcharge will be restricted. Once the Bill passes, the exemption is likely to be removed. The second reading speech for the Bill states: ‘the Government considers that the end of 2019 allows sufficient time for any remaining trustees and their advisers to make necessary changes to trust deeds’.

It is therefore important for trustees to review existing discretionary trust deeds and consider whether they require amendment.

In order to avoid the application of surcharge duty and land tax, discretionary trust deeds must include a clause that prohibits the trustee from making trust distributions to, or otherwise benefiting a foreign person. The deed must also prohibit an amendment that has the effect of allowing the trustee to make distributions to, or to otherwise benefit, a foreign person.

The By Lawyers Discretionary Trust deed precedents and commentary have been amended accordingly. A note has also been added to the ‘Retainer Instructions – Trusts’ precedent, to prompt practitioners to raise this issue with clients when drafting trust deeds.

See the commentary in the By Lawyers Trusts Publication for further details.

 

Amendments to domestic violence law – SA

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Recent amendments to domestic violence law have commenced in South Australia. They are contained within the Statutes Amendment (Domestic Violence) Act 2018.

Variation of interim orders

The new s 26A of the Intervention Orders (Prevention of Abuse) Act 2009 enables an applicant to apply to the court to vary an interim order issued by police.

Where such an application is made the court must hold a preliminary hearing as soon as practicable and without summoning the respondent to appear. An application can be made by telephone or other electronic means, and the preliminary hearing may occur by oral questioning of the applicant and any other available witness, or by other means contemplated by the rules including affidavit evidence. If the court thinks it appropriate, it may adjourn the hearing so the applicant can attend for questioning.

At the preliminary hearing, the court may:

  • issue an interim variation of the intervention order if it appears to the court that there are grounds for issuing the variation; or
  • determine that the application should be dealt with under s 26 without the issuing of any interim variation order; or
  • dismiss the application on any ground considered sufficient by the court.

Any interim variation issued by the court must require the defendant to appear before the court within eight days.

An interim variation of an intervention order issued by the court comes into force against the defendant when:

  • the order is served on the defendant personally; or
  • the order is served on the defendant in some other manner authorised by the court;
  • the defendant is present in the court when the order is made.

Admissibility of recorded evidence

Pursuant to the new s 13BB of the Evidence Act 1929 and the new s 28A of the Intervention Orders (Prevention of Abuse) Act 2009, the applicant, or someone else for whose protection an intervention order is sought, may give evidence via a recording. Section 28A applies in addition to, and does not derogate from, any other power of the court to receive evidence or to determine the form in which evidence may be received, including evidence in the form of a recording.

Domestic violence strangulation offence

The new s 20A of the Criminal Law Consolidation Act 1935 introduces a specific domestic violence strangulation offence—namely, choking, suffocating or strangling a person without consent with whom the offender is, or was, in a relationship. The maximum penalty for the offence is seven years imprisonment.

Amendment to publications

These amendments to domestic violence law have been incorporated into the commentary in the By Lawyers Intervention Orders guide for South Australia.

Off the plan contracts – NSW

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Significant changes to off the plan contracts commenced 1 December 2019.

The changes arise from the Conveyancing Legislation Amendment Act 2018 (NSW) and the Conveyancing (Sale of Land) Amendment Regulation 2019 (NSW). They place further disclosure obligations on vendors. They also create new remedies and stronger protections for purchasers when entering into residential off the plan contracts.

Changes to off the plan contracts – summary:

  • Certain prescribed documents must be attached to residential off the plan contracts. These include a prescribed Disclosure Statement, a draft plan prepared by a registered surveyor and other draft documents, as set out in clause 4A of the Conveyancing (Sale of Land) Regulation 2017.
  • A purchaser can rescind the contract within 14 days if the Disclosure Statement, draft plan or relevant prescribed documents are not attached to off the plan contracts exchanged on or after 1 December 2019.
  • There is an ongoing obligation on the vendor to notify purchasers of changes to material particulars using the prescribed Notice of Changes form. Purchasers may be able to rescind or claim compensation if there is a change to a material particular.
  • The cooling-off period for residential off the plan contracts is extended to 10 business days.
  • The final registered plan must be provided to the purchaser at least 21 days before settlement.
  • Deposits must be retained by the stakeholder in a trust or controlled monies account.

An off the plan contract is defined in the amending act to mean a contract for the sale of a residential lot that does not exist at the time the contract is entered into.

The following are not caught by the amendments:

  • The sale of a commercial property off the plan.
  • The sale of a residential lot off the plan if it is sold at the point when the title is registered but an occupation certificate has not been issued.
  • Contracts arising out of the exercise of an option that was entered into before 1 December 2019.

Updates to By Lawyers publications

  • The By Lawyers Conveyancing Publication, including Sale and Purchase Guides and 1001 Conveyancing Answers, all contain dedicated commentary regarding off the plan contracts. These commentaries now cover the new requirements in detail.
  • The By Lawyers Contract for Sale of Land has been amended as follows:
    • Statutory cooling off notice – 10 business days;
    • Statutory attachments table includes Disclosure Statement;
    • Price and deposit clause addresses the requirement for deposit and instalment payments to be held as trust or controlled money;
    • New clause 16(d) ‘Residential off the plan contracts’; and
    • Off the plan settlement changed to 21 days after notice of registration of plan.
  • All precedents making reference to cooling off periods have been updated to accord with the new period.
  • Disclosure Statement and Notice of Changes forms are available on the Sale matter plan.
  • New notices for rescission and compensation claims have been added to the ‘Claims, disputes and notices’ folder. Precedent letters serving these notices on the relevant parties have also been added.

By Lawyers are proud to assist subscribers to understand and comply with these amendments. Like all By Lawyers publications, our Conveyancing Guides provide all the necessary commentary and precedents in one place. Enjoy practice more!

 

 

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