• Using Intellectual Property to Sustain your Business: IP can open new markets and develop new revenue streams
• Recent Changes to the Credit Reporting System: Your repayment history information can now be shared
• Business Briefs:
  • Consumer Law Reform Bill update
  • ‘Would’ v ‘Could’
  • Why the concept of traditional gifting should not be easily dismissed

 The next issue of this e-newsletter will be published in the Spring.

Commercial eSpeaking, Winter 2012

• Joint Tenancy and Tenancy in Common – How do we choose?

• Property Briefs:

 - Mortgagee sales – how to avoid one
 - Being the surviving spouse – some options
 - A reminder: buyers beware of GST zero-rating

If there’s anything you’d like to discuss with us further, please feel free to contact us.

The next edition of Property Speaking will be published in August.

Property Speaking

Our new visual identity not only has to express this new dynamic, but also reaffirm our fingerprint, our culture, our history and our values.

The visual identity was created to reinforce the essence of the Johnston Lawrence brand – a sense of continuity, featuring the simplicity and flexibility of the brand.

Our logo incorporates the ‘J’ and the ‘L’, and suggests movement, vitality and depth, with its translucent quality alluding to the transparent nature of the lawyer/client relationship.

The similarity between the logo and an ampersand suggests the partnership of the client ‘&’ law firm – working together for a common goal, providing excellent service and advice.

The colours were selected to symbolise Wellington through suggestions of blue skies, the depths of the harbour and verdant, bush-clad hills.

A bold, new look for Johnston Lawrence.

• New Licensed Building Practitioners – how will it affect homeowners?
• Using KiwiSaver to Buy Your First Home – good benefits available
• Consumer Law Makeover – Reform Bill introduced
• The Feed Wedge – ensuring you’ve enough feed on your new rural property
• Postscript

-       Having your say on MMP

-       Freephone number for help on loan problems

-       What do you do if you’ve been scammed?

-       SuperGold Card discounts

Please contact us if you’d like to talk over any aspect of these topics, or indeed any matter.

Fineprint, Autumn 2012

Some contracts are not intended to come to an end, such as relationship property agreements, and unless both parties agree, a court order would be needed to bring such a contract to an end. 

Other contracts give different rights to one side than the other.  For example, employees have greater freedom to end an employment agreement that an employer does.  Franchise agreements commonly give the franchisor a smorgasbord of reasons to end the agreement but don’t give the franchisee any rights to cancel even if the franchisor breaches the contract.

When establishing whether you can cancel a contract the first step is to read the terms of your contract carefully.  Many contracts have termination clauses that will record your rights.  There may be different types of cancellation clauses.  The contract may allow you to end it whenever you want to, or for any reason, as long as you give a specific period of notice.  The contract may also specify what kinds of breaches are considered serious enough to justify cancellation.      

Some contracts will also have clauses covering situations such as acts of god or frustration which are situations where the contract just can’t be fulfilled.

If the contract doesn’t contain a detailed cancellation clause you’ll have to rely on the law of contract to establish whether you’re entitled to cancel. 

You need to be aware that specific laws may apply to your situation, regardless of what the contract says.  For example, provisions in the Sale of Goods Act govern the rights of buyers and sellers in respect of second hand goods.  Similarly, the Consumer Guarantees Act regulates the rights of parties to sales of domestic goods when those goods don’t meet legally required guarantees. 

Then there are the more general laws.  There’s an Act dealing with cancellation if a mistake has been made by one or both parties when entering into the contract. 

A different Act applies if you want to cancel a contract because the other party has misrepresented something important or breached one of their significant obligations.  If you’re cancelling for this reason, the thing misrepresented or the clause which has been breached must be essential to you.  In both situations, the breach must either increase your obligations or burdens, or decrease the benefit you contracted to receive.

It’s also important to note that even if you’re entitled to cancel a contract there’s no obligation to do so.  If you’re considering cancelling, however, you need to be careful not to unintentionally affirm the contract by your behaviour or acquiescence.  Once you’ve affirmed the contract stands, you lose your right to cancel the contract for any previous breach. 

Cancelling a contract can be fraught with risk.  Even if you think your right to cancel is clear from the contract, the range of legislation that could potentially apply to the situation may catch you out.  You’re unlikely to regret ringing your lawyer to troubleshoot, because the cost of cancelling a contract when you’re not entitled to do so can be expensive.

Angela O’Meara is an associate in our firm and provided this commentary as a legal expert for the Your Law business section of the Sunday Star Times.

It’s a process by which you serve a company with a formal demand for payment of a debt owed to you, provided the debt is for a minimum of $1,000.   If the debt isn’t paid within 15 working days, or the company doesn’t provide a security over company property or offer a payment plan you’re happy with, in theory you can apply to put the company into liquidation.  It can be an effective way of pressuring a company to pay a debt quickly to avoid being wound up. 

The problem is that the statutory demand process is often misused.  The case law is riddled with criticisms of those who treat the statutory demand process as a debt collection device without regard for its proper purpose.

The statutory demand process is intended to be the first step in making an application to put a company into liquidation when the company is genuinely unable to pay a debt owed.  The High Court has little patience for those who use the statutory demand process when there is no prospect of the company being put into liquidation; it’s considered an abuse of process.

You can’t use the statutory demand process to recover a debt that is disputed.  If there’s a genuine dispute about whether the debt is owed, you’re expected to use an alternate debt recovery process, such as those available in the District Court or Disputes Tribunal.  If you do serve a statutory demand in respect of a disputed debt, the debtor company can apply to the High Court to have the demand set aside. 

It’s also expected that if you serve a statutory demand that you’ll get the process of serving the demand right.  If you don’t, that oversight is another reason the company served can have the demand set aside.

When it’s not used appropriately, the statutory demand process can prove to be an expensive mistake. 

Take the example of a dispute between two companies over an unpaid invoice.  The debtor company was late paying an invoice.  At the same time it did pay, the creditor company passed the debt over to its debt collection agency.  The agency wrote to the debtor company demanding payment of the original invoice, plus payment of its debt collection fee.  Lawyers for the debtor company wrote back advising the original invoice had been paid, and objecting to the unwarranted debt collection fee of $1,037.19. 

Regardless, the agency issued a statutory demand on behalf of the creditor to recover the debt collection fee. 

Lawyers for the debtor company successfully applied to the High Court to have the statutory demand set aside.  The Court held that the use of the statutory demand process was abusive.  It commented that issuing a statutory demand is a serious matter and best done by lawyers who have ethical obligations to ensure that doing so is appropriate. 

Not only did the creditor company fail to recover the debt collection fee, but it was also ordered to pay more than $4,000 in costs.

In the right circumstances, the statutory demand process can give you great leverage to get an outstanding debt paid quickly.  If the debt is disputed, however, or the company that owes it is not in any financial difficulty, you use the statutory demand process at your peril.

Angela O’Meara is an associate in our firm and provided this commentary as a legal expert for the Your Law business section of the Sunday Star Times.

• Family Trusts and the Family Protection Act 1955: a recent case
• Ring-fencing Your Assets When You’re in Business: Taylor v Official Assignee
• Divided Loyalties and Conflicts of Interest: Duties of a trustee

 If you’d like to find out more about any information in this newsletter, or about trusts in general, please call us.

The next issue of Trust eSpeaking will be published in September.

Trust eSpeaking Summer 2012

Phil has worked with leading New Zealand law practices for over 28 years, with expertise in commercial and residential property and land law. In addition, Phil advises local authorities and government departments on major infrastructure projects and land acquisitions and Public Works Act compensation matters.

Phil adds another dimension to the legal portfolio here at JL.

A solicitor in our business and property team, Natalie joined the firm in 2010, providing quality service and achieving successful outcomes for many.  

Contact Natalie for assistance with your commercial law, property law, trusts, wills and estates requirements.

Natalie Gaskin

Ph: 04 916 0138

Natalie@johnlaw.co.nz

• Family Businesses: Planning ahead for success
• Insolvent Transactions and Claw backs: The Companies Act carries a sting in its tail
• Clearing up Confusion about Criminalising Cartels
• Business Briefs:

             -  90-day trial periods

             -  Spam

             -  Companies and Limited Partnerships Amendment Bill

We hope you find the articles interesting and useful. Feel free to call us for further information on any of the topics below, or any business law matter.

Commercial eSpeaking Summer 2012