Following on from our recognition as a First Tier Law firm in Victoria for both ‘Wills & Estates Litigation‘ and ‘Wills, Estates & Succession Planning‘, we are proud to share that Practice Leader, Lachlan McKenzie, has been featured as a ‘Leading Wills & Estates Litigation Lawyer’ in the Doyle’s Guide national rankings.
The 2023 listing details solicitors practising within the areas of Wills & Estates Litigation, Disputes and Contested matters across all Australian legal markets.
This recognition also marks the seventh consecutive year that Moores has featured in the national rankings.
For more information or to speak with one of our experienced lawyers, please do not hesitate to contact us.
A cornerstone of our law is the presumption that adults have legal capacity to make their own decisions unless proven otherwise. But because decision-making capacity is issue and decision specific, this can mean that someone may have decision-making capacity for some easier decisions, such as getting married, but not for other more complex ones, such as making a will, leading to some unusual outcomes.
For example: Noah is a widowed elderly gentleman living in a nursing home. His estate plans were set up years ago and his will leaves his estate to his two sons. These days Noah has dementia and is losing decision-making capacity, however, he finds companionship in the nursing home and marries Allie. A lovely way to live out his days with his new wife. However, the act of Marriage has now voided Noah’s will.
Noah has the capacity to get married but does not have capacity to make a new will. This means Noah’s long standing wishes in his will are disregarded. When Noah dies, based on the laws of intestacy (the laws that apply when someone dies without a will) much or all of his estate passes to his new wife, Allie.
Because of the significant ramifications that can flow from someone having or not having capacity to make certain decisions, it is critical that the correct evidence is applied to the correct legal tests wherever a decision is proposed or made where a person’s capacity is in some doubt. Making sure the right evidence is applied to the right test can help ensure an elderly or disabled person’s autonomy is preserved and respected and can avoid costly future legal disputes if a particular decision or transaction is disputed after the fact.
Generally, a person’s decision-making capacity in relation to any particular decision is assessed based on:
Capacity is a legal concept rather than a medical one, and different legal tests are applicable in different situations. However, assessing capacity is complex and in making capacity assessments, legal practitioners will often interact with medical practitioners and specialists such as a neuropsychologists to reach a conclusion.
Capacity is also fluid and can fluctuate. A person may have capacity on one day but not on another, or a person might have capacity in the morning but not later on in the day (this is particularly prevalent in the elderly).
Obtaining high-quality evidence at the time of a potentially contentious transaction can avoid future disputes that can drag on for years where costs may stretch into the triple figures. Too often, we see brief “one liners” from a person’s General Practitioner which might claim the person does or does not have decision making capacity but is of little evidentiary value because its not clear how they arrived at that conclusion, what decision their assessment relates to and what test they applied to get there.
Some signs that may indicate a person in your life’s decision making capacity could be in doubt include:
If you have concerns about a person’s capacity to make certain legal decisions, it is important that that the proper assessments and correct tests are completed and you get professional advice about the thresholds and tests which need to be reached for a person to be able to make those decisions.
If you suspect a vulnerable person’s capacity to make a certain legal decision (such as getting married, entering into a legal transaction, making a Will or appointing an Enduring Power of Attorney) is impaired, we can assist in applying the appropriate tests to assess their decision-making capacity and ascertain whether they are able to do so.
Please contact us for more detailed and tailored help
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Disclaimer: This article provides general information only and is not intended to constitute legal advice. You should seek legal advice regarding the application of the law to you or your organisation.
In our previous article, we highlighted the issues that can arise where a family trust deed has been lost and the importance of retaining a complete copy of the trust deed.
The Court’s view of the process that needs to be followed when a trust deed has been lost has been further considered in two recent New South Wales cases – Application of DEK Technologies Pty Ltd as trustee for DEK Technologies Unit Trust & Ors [2023] NSWSC 544 (“DEK Technologies case”) and BAGI Pty Ltd trading as atf Nick Ristevski Family Trust v Marka Ristevski [2023] NSWSC 567 (“BAGI case”).
These cases offer greater hope to trustees of the Court taking a more pragmatic approach where a deed has been lost.
The case was brought before the New South Wales Supreme Court by the trustees1 of four trusts who sought judicial advice that they were justified in administering the trusts on particular terms, in circumstances where the trust deeds could not be found.
Although the trust deeds had been lost, at the time the trusts were established the accountant (Mr Scopelliti) prepared a detailed letter of advice outlining the establishment of the unit trust with the family trusts as unitholders and setting out various other details of the trusts, such as the discretionary beneficiaries. A corporate diagram was also prepared.
The plaintiffs could not recall receiving a copy of the unit trust deed or signing it and could not recall signing the establishment documents for the respective family trusts.
Mr Scopelliti gave evidence that in establishing trusts for his clients, he always had the trust deeds prepared by ASIS Services Pty Ltd, and that he made no changes to the deeds provided by the company. Further evidence was given by a former employee of ASIS Services Pty Ltd that they had a number of template trust deeds that included all relevant terms and that their order forms contained specific details concerning the trust name, establishment date, settlement sum, applicable law and details of the settlor, trustee and beneficiaries, which was stored on their database.
In making its decision, the Court referred to the case of Vanta Pty Ltd v Mantovani [2023] VSCA 532 and adopted the view that the relevant question to the Court is whether it is satisfied, on the balance of probabilities, that the trust deeds were executed and contained the terms proposed, which may be established by secondary evidence.
In a pleasing result for the plaintiffs, the Court held that the trustees were justified in managing and administering the trusts according to the terms outlined in the letter of Mr Scopelliti, the template deeds and information on the order forms.
In this case, brought before the New South Wales Supreme Court by the trustee of a family trust, an order was sought that the trustee was justified in treating a replacement trust deed as the operative deed for the trust, and to remedy an error in the rectified deed.
The original trust deed for the trust was executed on 1 July 1989 (“the 1989 Deed”) of which the only two parties were the settlor and the trustee. The trustee believed that the original deed was held at a bank branch when it was provided to them as part of loan documentation requirements. However, in 2010 the trustee sought the original from the bank but they could not locate the original or a copy. The trustee made enquiries between 2012 to 2015 as to the whereabouts of the original 1989 Deed, but it could not be located.
In 2015, the trustee sought advice to have the 1989 Deed replaced with a new trust deed, without any knowledge of the terms of the original trust deed. The replacement deed was signed on 12 February 2015 (“the 2015 Deed”) which was described as a “confirmation deed”.
In 2020, an incomplete copy of the 1989 Deed was found at the family home of the trustee. The incomplete copy showed the beneficiaries of the trust created in the 1989 Deed, which were different to the 2015 Deed. The trustee therefore wished to rectify the 2015 Deed to include the beneficiaries included under the 1989 Deed.
The Court held that the 2015 Deed could be rectified, provided it could be established that the parties to the deed had a common intention which continued up to the time of execution. The Court held that there is evidence that the common intention of the 2015 Deed was to reproduce the 1989 Deed and accordingly, the beneficiaries of the 2015 Deed can be amended to reflect the 1989 Deed.
In relation to whether the trustee could rely on the 2015 Deed as the operative deed, the Court held that the original 1989 Deed contained a broad power of alteration, modification or revocation of the trust and accordingly that power was sufficient to authorise the amendments which occurred to the trust via the 2015 deed. Therefore, the Court confirmed that the trustee was justified in acting in accordance with the 2015 Deed.
Although on its face both matters are a win for the trustees, it is worthwhile noting that potential unintended consequences were not specifically addressed by the Court.
In particular, the BAGI case raises the question of a potential duty complication where a confirmation deed is adopted – being the 2015 Deed in the matter. Depending on where the trust assets are held, and in this matter they fell within the New South Wales jurisdiction, the relevant state revenue office may view the confirmation deed as a resettlement, trust acquisition or a declaration of trust (applicable in New South Wales) which would result in duty being applicable on the market value of the dutiable property of the trust.
It is therefore important that, in particular where trusts hold dutiable property, that the trustee, their advisors and accountants know the whereabouts of the original deed, have sighted it and retain accessible copies. Should there be a need for the preparation of a deed of rectification or confirmation for any trust, then it is integral that the terms of the trust are as consistent as possible with the original trust deed.
Please contact us for more information and tailored assistance.
1 DEK Technologies as trustee for the DEK Technologies Unit Trust, Drini Mulla as trustee for the Mulla Trust, Kerim Tanovic as trustee for the Tanovic Trust, and Wisdomw Consultancy (Vic) Pty Ltd as trustee for the Yim Tang Family Trust.
2 See https://www.moores.com.au/news/lost-trust-deed-implications-for-family-trusts/.
When a member of a superannuation fund dies, their superannuation benefits (known as ‘death benefits’) must be paid out of the fund – this is what is referred to in the superannuation industry as a ‘compulsory cashing event’.
If the member’s superannuation is not paid to a ‘tax dependant’ (being someone eligible to receive the member’s superannuation entitlements tax-free), then there will be some tax to pay. The tax can be up to 15% of the member balance, and up to 30% of any life insurance that the member owns within the fund.
Because of this tax, where a person does not have any tax dependants, a common strategy is to consider withdrawing the superannuation into their personal name prior to their death, provided they meet certain conditions to access their super during their lifetime. This is often referred to as a ‘death bed withdrawal’, as many superannuation members do not want to withdraw their entitlements too early, given the concessional tax treatment usually afforded by holding wealth in the superannuation environment.
But there is some grey area here – what happens when someone has requested a withdrawal of their entitlements, but they pass away before the payment hits their personal bank account?
In February 2023, the Australian Taxation Office (ATO) published a list of factors that it will consider to determine with a payment in this scenario is a ‘death benefit’, meaning it will be subject to tax (if applicable) or a ‘member benefit’, meaning that the payment can come out to the member as non-assessable, non-exempt income i.e. essentially it is tax free (noting that other taxes such as capital gains tax and stamp duty may still apply).
Importantly, one of the key factors that the ATO considers is whether the trustee of the fund had knowledge of the member’s death prior to making payment of the superannuation out of the fund, which does not appear to have been considered as a relevant factor in the ATO’s previously published private binding rulings.
In the case of a self managed superannuation fund (SMSF), unless one of very few exemptions apply, the member must be a trustee, or director of trustee company, of the fund, and on their death, their legal personal representative (being the executor of their Will or the administrator of their estate) will take their place in the controlling role. As such, there are very few circumstances where the trustee of the fund will not be aware of the member’s death, prior to making the payment pursuant to a request made by a member during their lifetime – perhaps only circumstances where an independent legal personal representative, such as a professional advisor or professional trustee company is appointed.
Following the ATO’s publication of the new factors for consideration, a private binding ruling has been published which sought to clarify whether payment from an SMSF initiated by a request during the member’s lifetime, but paid after their death, was a ‘member benefit’ or ‘death benefit’. The ruling concluded that the payment was a death benefit.
The ATO’s decision in this ruling largely turned on the SMSF trustee’s knowledge of the member’s death prior to making payment and stated that “it cannot be said that the trustee made the payments with the exemption that the member would be alive to receive it”.
Given this updated stance taken by the ATO in considering payments in these circumstances, it is difficult to see many opportunities that SMSF members will have to withdraw their super as non-assessable, non-exempt income, when doing so in the days immediately prior to their death, particularly in circumstances where assets will need to be sold or liquidated. Instead, longer-term planning may be required if a member has a serious health condition and consideration is given to the income tax benefits of retaining superannuation within the fund, versus the death benefits tax that would be payable if the funds are not withdrawn.
It is crucial that all advisors involved in assisting SMSF members are clear on the new ATO factors and how they are being adopted by the ATO through publications of its private binding rulings. Beyond this, all advisors in this area need to be fully across the governing rules of the relevant SMSF to efficiently take client instructions and implement withdrawals, particularly when the request is time critical.
For expert advice or guidance regarding Estate Planning and self managed superannuation funds, please do not hesitate to contact us.
Moores has ranked as a ‘First Tier’ Law Firm for Victoria in both the ‘Wills & Estates Litigation‘ and ‘Wills, Estates & Succession Planning‘ categories for the seventh year running.
In addition, Jennifer Dixon, Lachlan McKenzie, Krista Fitzgerald and James Dimond have all featured as Leading Lawyers and Max Ezerins as Rising Star in the latest Doyle’s Guide. Recognised by their peers and referrers for their expertise in Wills & Estates Litigation and/or Wills, Estates and Succession Planning.
Our expert team is experienced in assisting families with complex Estate Planning arrangements as well as challenging and defending all manner of Disputes relating to Wills, Estates, Trusts, SMSF and Bequests.
We know term three means schools start thinking about next year’s enrolments and many schools have already set their budget and approved the 2024 fees. For the 2024 school year, there will be changes to the Australian Consumer Law which may cause you to update the documents which constitute your Enrolment Agreement with families. We take a look into these changes, scheduled to come into effect on 10 November 2023, for the perspective of independent schools. Here’s what to know:
A term in your enrolment agreement may be unfair if it:
Whether a contract term is ‘unfair’ depends on the particular circumstances of that contract and ultimately can only be determined by a Court. There is a recent decision from the ACT Civil and Administrative Tribunal about an Enrolment Agreement: Brindabella. We wrote about this here.
Brindabella found:
The use and application of, or reliance on, unfair contract terms is prohibited. Previously, unfair contract terms could be deemed void and unenforceable by the Court. Now that unfair contract terms will be prohibited, the Court can impose financial penalties for breaches of this prohibition. This change is a stronger protection for consumers.
For the Australian Consumer Law to apply, and the possibility of an unfair contract term to be relevant, a contract must be considered a “standard form contract”. The changes are expanding the definition of “standard form contract”, and therefore the application of the Australian Consumer Law.
More information from the Australian Competition and Consumer Commission is here.
In the current economic climate, and with many schools increasing fees in response to the payroll tax, there is a commonly felt “pinch” in the industry and among parents. This increases the risk that parents may (among other things):
In July 2022, we recorded a webinar which you can watch for free to get you started on any updates that may be needed, both in response to Brindabella, and these amendments to the law.
Another risk is that the Australian Competition and Consumer Commission (ACCC) may prioritise enforcement of these new laws, and proactively take legal action against organisations who are in breach of the Australian Consumer Law.
Enrolment Agreements can be complicated. You are providing a service to the students you are educating, but you are contracting with parents. You are entering into an agreement for Prep and seeking to enforce that agreement years later. We can help update or redraft these contractual documents in a manner that reduces the risk of any breaches of the Australian Consumer law, but also to give you strong contractual rights to collect fees critical to ongoing operations. We also work in disputes when there are termination or withdrawal or enrolments, or other disputes with parents.
Please contact us for more detailed and tailored help.
1Competition and Consumer Act 2010, Sch 1 “Australian Consumer Law”, s 24(1).
The Minimum Practice Standards: Specialist and Community Support Services Responding to Child Sexual Abuse (Standards) were launched on Wednesday 6 September 2023 under the National Strategy to Prevent and Respond to Child Sexual Abuse 2021-2030.
The Standards embed the three core values of being victim and survivor centered, trauma-informed, and culturally safe, across the six standards.
The Standards apply to specialist and community support services responding to child sexual abuse, including:
The Standards are not intended to apply to:
However, all organisations and services will benefit from drawing from the Standards to improve their responses to child sexual abuse.
Helpfully, under each standard are ‘standard indicators’ which organisations can draw from to implement each standard within their own practices and services.
Our Safeguarding team can assist your organisation to draw on the Standards to strengthen your organisation’s practices when responding to and preventing child sexual abuse. Our team of experts can support your entire organisation to comply with the Standards, from providing guidance to your Board, through to policy development and delivering staff training. Contact Skye Rose or Cecelia Irvine-So for more information about how we can support your organisation to take this incredibly important step to providing a safe environment for all children.
We know that discrimination negatively impacts on the ability of students with a disability to participate and maximise their potential in the school environment.
In our experience, schools work hard to provide a broad range of reasonable adjustments to support students with disabilities. Schools are generally familiar with the requirements under state and federal anti-discrimination laws that students with a disability have access to education on the same basis as their peers.
What schools may be less familiar with is the vulnerability of students with a disability to child abuse or risk of harm. This vulnerability is well documented. The Royal Commission into Institutional Responses to Child Sexual Abuse heard evidence that children with a disability can face additional barriers to disclosure of child abuse or harm. Students with a disability are also more likely to be subjected to restraint or seclusion and are more likely to be bullied. The importance of protecting the safety, welfare and best interests of children with a disability is reflected in the National Principles for Child Safe Organisations, which includes a key principle that equity is upheld, and diverse needs respected in policy and practice. Ministerial Order 1359, which implements the Child Safe Standards for Schools in Victoria, reinforces this principle by legally requiring schools to pay particular attention to the needs of students with disabilities.
So what does this all mean and what actions can schools take to ensure child safety for students with a disability?
Below are just a few tips for schools to ensure child safety for students with a disability and comply with their legal obligations:
Our Child Safety team can help you to develop a best practice Child Safety Policy and Procedure and Child Safety Code of Conduct. We can also run some of the leading child safety training in Australia for both staff and for older students. If a child safety issue arises, we can support you in your response and investigation. Contact to us to hear more about these services.
The September school holidays are around the corner, and summer holidays will be here before we know it. With holidays can come students going to parties, drinking, taking “compromising” photos and spending many more hours than usual on social media. As part of our work for National Child Protection Week (3 to 9 September 2023), we’ve reflected on the key risks to young people heading into school holidays and the extent of the school’s duty of care in that holiday period.
It is the duty of schools and teachers to take reasonable steps to reduce the risk of reasonably foreseeable harm occurring.
The extent of the duty of care has steadily been increasing in recent years, both through legislative tools (Ministerial Order 1359) and case law. We’ve previously explained the expanding “school environment” and decision of PCB v Geelong College [2021] VSC 633. The key takeaway from this case was that schools can be responsible for the acts of third parties, who are volunteers, or members of community groups, when the school facilitates the introduction or connection with students, and risks are reasonably foreseeable but not addressed.
Discharging the duty of care means understanding what reasonably foreseeable risks students are facing. Over school holidays, we have seen risks of:
Schools cannot, and are not expected, to prevent any harm occurring. Instead, the duty is to take reasonable steps to mitigate the risk of these harms occurring. Schools may well have a duty of care to students even on term break, particularly where behaviour involves another student from the school. Once the school is informed of any issues, it needs to act and take reasonable steps to investigate. Whilst general reminders are insufficient to discharge the duty of care with respect to known incidents, a reasonable step towards discharging the duty of care will often be education. With the reduced level of supervision and oversight over school holidays, providing students with information about their rights, responsibilities and how to seek help and support can prevent harm occurring, and/or escalating. It is a requirement under the Ministerial Order 1359 that schools:
Schools should use end of term assemblies and communications to reiterate:
We offer training for school staff about the duty of care, online safety and how to respond to identified risks of harm to students. We also offer information sessions and seminars for students to informed students about their rights and responsibilities, both in terms of the affirmative consent model and being a digital citizen to students as part of our Safeguarding and Child Safety work.
Disclaimer: This article provides general information only and is not intended to constitute legal advice. You should seek legal advice regarding the application of the law to your organisation.
1eSafety, Digital Lives of Aussie teens (2021) page 5. You can download the full report here: https://www.esafety.gov.au/research/digital-lives-aussie-teens
2 eSafety, Digital Lives of Aussie teens (2021) page 11. You can download the full report here: https://www.esafety.gov.au/research/digital-lives-aussie-teens
If you are a charity or for-purpose organisation, you may have been following news reports in the last month (August 2023) about a privacy breach affecting “thousands of donors to Australian charities”. This article looks into an emerging trend of third-party data breaches – data breaches by contractors or service providers – where the charity or victim organisation obtaining the services has the public-facing brand name which makes it into news reports. Then we give some recommendations for what you can do about it.
A third-party data breach occurs when a malicious or criminal actor compromises a supplier, service provider or contractor to gain access to sensitive information or systems at the victim organisation’s customers, clients or business partners. For example:
Third-party data breaches are increasing because of the increased uptake of contracted automation and efficiencies, the imperative for not-for-profits to optimise their support and contact databases and increased criminal activity via hacking. Many not-for-profit organisations may not know, or take responsibility, for where their data goes when working with other organisations. Often, they simply trust that the third party has adequate systems in place. Further, charities, schools and other for-purpose organisations may have many different service providers and contractors with whom different information is being shared. This means it is difficult to know where your data is.
Knowing where your data is was the principal recommendation of Victorian Privacy and Data Protection Commissioner, Rachel Dixon, during Privacy Awareness Week in May 2023.
“Know what data you hold, and where it is.”
In more technical terms, this is referred to as data mapping, or visualising your organisation’s data assets. Data mapping sets you up to take action to protect that data. It will also prepare your organisation to respond to pending amendments to the Privacy Act 1988 (Cth).
Another recommendation to mitigate the risks of third-party data breaches is to include privacy requirements in your contracts with these service providers. Your contracts should:
Incorporating privacy-by-design into your information systems can help reduce the risk of data breaches, by implementing systemic protections to avoid the circumstances that lead to a breach even arising. Privacy-by-design is the idea of building privacy protections into processes to make good privacy practices a part of normal, everyday practice – making them the “default setting”.
In this context, this would be systemic protocols or restrictions of the sharing of information with third parties, such as a restriction on the downloading and exporting of client, donor or student data so only certain staff can do this, or the data must be shared in a specific way that has been considered and approved by the Privacy Officer.
We can help you with data mapping, contracting with service providers and redesigning your information systems with privacy-by-design in mind. If you have unfortunately been affected by the data breach currently in the media, we can support you in your response and risk mitigation. Contact us to hear more about these services and our perennially popular privacy and data breach training.