FAQs
Whether this is your first time using a lawyer, or you have a history of legal engagements, we understand that clarity is paramount. Our comprehensive list of frequently asked questions covers a wide spectrum of legal topics, and is a great place to start.
If your question is not here, or you require further clarification, please contact our office so that we can put you in touch with the right specialist for your enquiry.
FAQs About Downie Stewart
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We set our fees in accordance with the New Zealand Law Society guidelines. Fee estimates may take into account the time required, the complexity of the matter, risk to the firm, value to the client, whether the matter is urgent, and a number of other factors set out by the Law Society.
Where possible we will provide a fee estimate at the beginning of an engagement, such as common transactions like conveyancing, where we know from experience how long those files generally take. All fees are estimated on a case by case basis as no two files are the same.
If you would like to discuss a fee estimate for work you are considering, call us today.
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We are required by law to obtain a lot of basic but personal information about all our clients. This may include proof of identity, address, source of wealth (if money is passing through our trust account), your IRD number if we are dealing with land, and a number of other things.
Where you use a name that is different to that shown on your identification, we may ask to see a marriage certificate or deed poll, and we may need you to sign a statutory declaration to explain the difference.
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We work with people all over the country and around the world. For established clients we can do most work remotely, meeting and witnessing documents via Zoom or similar. A small number of documents still require in person witnessing. We can help make arrangements for that, depending where you are and what the document is.
We can complete client onboarding remotely as long as you have a New Zealand driver’s licence and cellphone number. Where you are required to sign a document in front of a JP or lawyer, we can help arrange that in your town, or you are welcome to come in to the office.
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Most of our lawyers and legal executives are experts in more than one area of law. For example, we might advise on conveyancing with relationship property matters, or rural transactions with succession planning. Not many files are only about one thing!
The easiest way to get the best fit lawyer for your work is to call our receptionist Briar and give her an idea of the sort of work you need. She will put you through to the right person, and if necessary we will put together the right team for you.
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Downie Stewart is a modern firm with a very long history. We value integrity, hard work and personal relationships. Our staff have lived and worked all over the world, with many coming to law as a second career. Their maturity and depth of experience is very helpful when analysing legal issues and giving practical legal advice.
We are very privileged to work with the clients that we do, we love being their trusted advisors.
We encourage our staff to live well and implement various wellness initiatives for them. This is reflected in the number of long-term staff that we retain.
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Yes, Downie Stewart can act as a professional trustee for client’s trusts. Each trust is assessed on a case-by-case basis.
New Zealand courts have emphasised the importance of having an independent trustee. A key role of the professional independent trustee is to provide an independent view on matters and ensure that trustees meet their legal obligations. A key element of this role is helping to ensure that trustees uphold their legal obligations. This is particularly relevant to the additional duties imposed by the Trusts Act 2019.
The Partners of Downie Stewart are commonly appointed as executors of clients’ wills. Our partners are very experienced in estate administration and accustomed to dealing with families of clients in the difficult times after death. Our Partners often provide much-needed reassurance, experience and oversight in what can be a very challenging time.
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In New Zealand, barristers are courtroom specialists. A unique hangover from the historical separation between barristers and solicitors is that barristers are unable to accept money from clients directly, nor can they operate a trust account. Instead, clients must first engage a solicitor who in turn engages a barrister.
A solicitor is someone more likely to be your first point of contact when you have a legal issue. Solicitors generally advise on rights and obligations, draft legal documents and assist with legal compliance and typically have an area of law in which they specialise. A solicitor though, is not precluded from appearing in court. All lawyers at Downie Stewart are qualified as barristers and solicitors of the High Court, although we practise as solicitors.
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During a transaction, whether it be in a commercial or personal context, you may be asked to take independent legal advice. This could be because the transaction you are entering either involves you incurring liability or waives one of your rights. Some legal documents require all parties to it to have received independent legal advice to be legally enforceable. Some examples of these types of documents are:
Relationship Property agreements also known as a ‘Contracting Out agreements’ or ‘Pre-nups’;
Separation agreements;
Personal guarantees (albeit there are times when you can waive your right to independent legal advice);
Occupation right agreements; and
Enduring Powers of Attorney.
Independent legal advice is where you meet with a lawyer who has no association with any other party to the matter you are involved with. The lawyer will advise you of the effects and implications of entering the transaction and answer any questions you have in relation to this.
Property FAQs for Buyers and Sellers
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We will be asking you all the standard client on-boarding questions. In addition, we will need to know about your New Zealand residency or citizenship status, because not everyone can buy residential land in New Zealand. In particular, there are some houses and sections that resident visa holders cannot buy under current Overseas Investment rules.
We will also have a number of questions about the house you are interested in. Those will likely include:
How old is the house? Has it had renovations? Does it have a woodburner? Has there been any rewiring? Have you checked you can insure this property? Has there been any flooding at this property? Any earthquake damage claims? How will you pay for it? Will you be using savings, kiwisaver, a family loan or gift? If you are using a mortgage advisor, who?
All of these answers help us do a better job for you and be accurate with our fee estimate for your work. Some of these make a nice list of questions you can ask the agent.
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Start with a call to Jane Fletcher. Jane heads our property team and specialises in subdivision work including fee simple, cross lease and unit title developments. Jane will help you put together the team you will need for an efficient, well-organised project, including your surveyor, valuer, accountant and lender.
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“Solicitor’s Approval” clauses are often mistaken for Due Diligence conditions. A well-written Due Diligence condition can give a purchaser an opportunity to carry out broad investigations of the property including reviewing the LIM report, Title, Building Report, insurance and even finance, after their offer has been accepted.
Solicitor’s Approval clauses, by contrast, allow a solicitor to disapprove the agreement only if there are quite narrow legal issues which impede the legal conveyance (passing of title) of the property. This clause is not a ‘get out of jail free’ card, and cannot be used to insert a condition, such as finance, that the buyer and seller did not include in the agreement to begin with. We discourage the use of Solicitor’s Approval clauses as they are widely misunderstood and dangerous to buyers. If you have any queries about the clauses in your offer, have the agent to send it to us to check over before you sign.
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The Bright Line rules are a set of tax rules under which the government taxes the capital gain on some residential land and house sales. There are some exceptions to the rules, including when you are selling your main home, and some exceptions to the exceptions! It is important to remember that even when you qualify for a bright line exemption, there are other reasons a residential land sale can be taxed too. We recommend you seek advice from an accountant to check any tax and timing implications before you sell.
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Yes. We recommend that you allow your lawyer to check the Sale and Purchase Agreement before it is sent out to potential purchasers. There are significant vendor warranties in the Agreement relating to the state of the chattels, council notices, and whether work done to the property has all the appropriate consents. We are often engaged to limit these warranties where they are too onerous on a vendor.
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A purchaser buying a house or building with vacant possession (no tenant) usually has a right to inspect the property once prior to settlement. This is the purchaser’s chance to check the chattels are in reasonable working order and that there has not been any damage to the property since the date of the Agreement. We recommend this inspection be completed 2-3 working days before settlement. The deadline for raising issues under this clause is very strict, and the best results sometimes take time to negotiate. Book your pre-settlement inspection through the sales agent, and let us know everything is great – or not – at least 2 working days before settlement date.
First Home Buyers FAQs
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First, you should contact your provider directly to apply for “pre-approval”. Your provider will confirm if you are eligible to make a withdrawal and how much you are able to withdraw.
Next, make a time to come and see us. We will help you complete the application form, collate the supporting documents required and help you complete the statutory declaration so your funds can be released in time to complete your purchase.
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Deposits are usually payable either on signing the agreement, or when the agreement becomes unconditional. That timing depends on the terms of your contract. "Unconditional" means the point when you have confirmed all your conditions such as finance, building report, LIM report etc. We are happy to look over your offer before it is accepted, to make sure that the timeframes you have in mind are realistic. If you are using KiwiSaver funds to pay the deposit, your agreement needs to have particular clauses in it to allow that. We can write those clauses in before you make an offer.
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A conditional agreement is one where there are still conditions to be satisfied by either the vendor or the purchaser before the parties are bound to proceed under the agreement. These could be arranging sufficient finance, obtaining and approving a building report, LIM report or even being satisfied with a general due diligence investigation of the property. You need to use your best endeavours to satisfy any conditions within an agreement.
If your agreement is unconditional then there are no conditions to be satisfied and you are bound to complete the transaction.
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It is great if your family wants to help you buy your first home! We can help clarify whether the money is a loan or a gift, and protect how it will be treated in the future. This is especially important if you are purchasing with your partner and if this contribution is intended just for you. We can provide you with the advice you need and the options available to make sure that this gift or loan is ring-fenced as separate property (or separate debt) and to clarify if there are any other contributions or assets that will remain separate property.
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A Land Information Memorandum or “LIM” is a report on a property provided by a local authority (Council) from their records. It will, among other things, identify whether any necessary building consents have been obtained for additions and alterations to the property. It also provides important information regarding the underlying land itself, as well as other activities that have been consented in the neighbourhood.
We will almost always advise you that you should collect as much information as possible regarding a property before you enter into an agreement or confirm the relevant conditions. A LIM report is a big part of this process and can uncover information you cannot know simply by looking at a property.
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A Building Report is completed by a ‘suitably qualified builder’ who has the necessary qualifications - just asking your builder mate will not get you very far under a Building Report condition. If you do uncover any issues, you need that formal report to rely on to either negotiate the terms of the contract or avoid (end) the agreement.
A building report can reveal hidden problems with the property. It is also very helpful identifying further maintenance and upcoming repairs that you might need to factor into your budget.
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A purchaser buying a house or building with vacant possession (no tenant) usually has a right to inspect the property once prior to settlement. This is the purchaser’s chance to check the chattels are in reasonable working order and that there has not been any damage to the property since the date of the Agreement. We recommend this inspection be completed 2-3 working days before settlement. The deadline for raising issues under this clause is very strict, and the best results sometimes take time to negotiate. Book your pre-settlement inspection through the sales agent, and let us know everything is great – or not – at least 2 working days before settlement date.
Commercial and Business FAQs
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In general, a director of a company can sign any document that is not a deed. There are exceptions to this rule where it is for instance not reasonable to assume that only one director would sign an agreement of that particular nature and importance.
If the document is expressed to be a deed then if there is only one director that director must sign and have their signature witnessed. If there are two or more directors then two directors must sign the document. Their signatures need not be witnessed.
A company also can appoint attorneys. A document creating a power of attorney must be signed as a deed.
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Most leases have what is called a holding-over period. This means that unless the lease expressly says otherwise the lease will continue on a month-to-month basis. This means that either party can terminate the lease by giving the other party one months notice.
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A broad range of laws apply to businesses in New Zealand. Which ones apply will depend on the individual business involved and therefore it is worthwhile to discuss any concerns with a lawyer in advance of establishing a business.
Generally speaking, the main laws that will apply to your business are likely to be the laws relating to employment contracts (including rules relating to entitlements of employees), Fair Trading Act matters (such as ensuring that you do not make misrepresentations), tax laws (to ensure that you pay the correct amount of tax), intellectual property, consumer laws (such as the Consumer Guarantees Act and the law relating to contract generally (eg supply agreements and terms of trade).
If you also form a company to operate your business then there are additional laws to consider such as the Companies Act.
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You can give notice to the creditor canceling a guarantee but you will remain liable for monies owing as at the date of cancellation. There may also be implications for the person whose obligations you have guaranteed.
Prior legal advice should be sought before giving any notice.
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A constitution is a document filed with the Companies Office and is freely searchable by the public. A Shareholder Agreement however is a private contract between shareholders of the company is generally confidential.
Shareholder agreements are generally used to govern more complex and specific matters (and private) than a constitution, which is typically used to deal with more mechanical issues.
We recommend the use of Shareholder Agreements before business relationships are entered into.
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Great care needs to be taken when entering into restraints of trade in even greater care needs to be taken when seeking to enforce them.
It is important for instance that if a restraint of trade is sought adequate consideration is provided for that restraint. Employment agreements regularly contain restraints of trade that have far-reaching and often unenforceable restrictions. It is more likely outside of an employment contract, that a restraint is able to be enforced (eg. upon the sale of your business).
Relationship Property FAQs
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Under the Property (Relationships) Act, couples that have been together for more than 3 years generally have joint ownership of the family home as relationship property. The same goes for other property, for example, bank accounts and income. This is called the principle of equal sharing.
When people separate they will divide their relationship property in accordance with this principle. That involves each party having their own lawyer and entering an agreement that records who retains what property after the relationship. If parties cannot agree, they will need to ask the court to decide.
Dividing your relationship property formally is normally the most crucial step following a separation.
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It is not true that separate property becomes relationship property as soon as a party is married.
Under the Property (Relationships) Act, a marriage or de facto relationship generally needs to have lasted 3 years for separate property to become relationship property. There are several exceptions to what separate property becomes relationship property.
Whether you are getting married, have been living together for some time, or have only just met, there is always the option for you and your partner to agree on what property is separate and what property is relationship property. This is commonly called a “contracting out agreement” or a “pre-nup”.
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In some cases, yes.
If your partner has been living with you at your home for at least 3 years (or less if you have children together), your home becomes relationship property as the “Family Home”.
Relationship property is, on separation, presumed to be equally dividable. This means your partner has a claim to half of the house (or the value of).
The presumption of equal division can be rebutted, but only when equal division is “repugnant to justice”. This can occur when one partner has financially contributed to the home. However, non-financial contributions to the relationship (e.g., child care, taking care of the home) are also considered and contribute to the presumption of equal division.
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You can contract out of the Property (Relationships) Act 1976 with a “Contracting Out Agreement”. A Contracting Out Agreement allows you and your partner to control how your property will be divided on separation.
For a Contracting Out Agreement to be enforceable, you and your partner need to get independent legal advice. This ensures that both parties understand the effects of the Contracting Out Agreement and what their rights would have been under the Property (Relationships) Act 1976 so they are making an informed decision.
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Wrong; a trust does not always protect your property from the claws of the Property (Relationships) Act 1976.
If you place your property into a trust before you’ve met your partner, then it’s likely that your property is safe.
However, a vested beneficial interest in a trust (and the resulting benefit from the trust) could be considered relationship property.
Transferring property to a trust after a relationship began, no matter how short the relationship is at the time, is not recommended without first seeking legal advice. You could be found to have made the transfer to defeat your partner’s interest in the property. The Court can compensate your partner for the value of the property, or in some circumstances amend the terms of the trust.
For the best protection of your property when entering into a relationship, see one of our relationship property experts to discuss a Contracting Out Agreement.
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Provided you are in a qualifying relationship, you can make an election to the estate for a division of relationship property.
This means that all relationship property will be collated and then equally divided between you and the estate. This election overrides any express bequests to you from the will.
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Yes, pets acquired during the relationship can be relationship property.
Some parties will create a care arrangement so both parties can see the pet, or one party might keep the pet and pay the other half the value of the pet.
If you have to go to Family Court for the division of relationship property, the Court will take good care of your pets and make a decision based on what is in your pets’ best interest.
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Yes it can.
In some cases, the presumption of equal division does not put you in the same position as your ex-partner.
You can seek a lump sum payment from your ex-partner to recognise your different financial position because of the role you took during the relationship. This lump sum payment usually occurs once relationship property is divided and the parties know what financial position they will be in post-separation.
If you need support before relationship property is divided, you can apply for spousal maintenance, which is a payment from your ex-partner to support your reasonable needs post-separation.
Family FAQs
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Under the Care of Children Act important matters effecting the child must be agreed upon between guardians. Non-routine medical treatment, for example a vaccination, requires the consent of the children’s guardians (normally their mother and father). A guardian must be involved in important matters regardless of whether they have care of the child or how much contact they have.
Other examples of guardianship matters include the child’s education, where they live, and their religious practice.
If parents are unable to agree on a guardianship matter they will need to apply to the court to make a decision. When considering the application the court will determine whether or not a decision is in the best interests of the child. In the case of vaccinations, the court consistently defers to medical evidence that vaccinations are in a child’s best interests.
When people separate they will divide their relationship property in accordance with this principle. That involves each party having their own lawyer and entering an agreement that records who retains what property after the relationship. If parties cannot agree, they will need to ask the court to decide.
Dividing your relationship property formally is normally the most crucial step following a separation.
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No. Child support and contact/care of a child are legally distinct issues.
Child support is governed by the Child Support Act. Normally the IRD will make an assessment based on a parent’s income and how much time the child spends with them. Parties are entitled to have a private child support arrangement, and even register that arrangement with the IRD to enforce it. However, either parent will always be entitled to request an assessment by the IRD to replace the private agreement at any stage.
Contact/care for a child is governed by the Care of Children Act. In deciding how much time a child should spend with each parent, the primary consideration is what is in the best interests of the child. Whether or not a parent is up to date on child support payments is irrelevant to this analysis. Indeed, if the Judge believes that a parent’s position on contact/care relates to child support, this is a very good way to annoy the Judge.
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Under the Care of Children Act there is no presumption that mum gets day-to-day care of the children. The essential question in any care/contact matter is what is in the best interests of the child.
The Family Court is quick to intervene in situations where a child has not had any contact with their non-caring parent. In particular, there is a continued recognition of a father’s involvement with the children as regularly as possible even if they are not in his day-to-day care.
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The decision about where a child resides falls under guardianship, a responsibility typically shared by both parents.
All guardians must be consulted and provide consent for any guardianship decisions, including relocation. In cases where parents cannot reach an agreement on guardianship matters they have the option to seek resolution through the Family Court.
This legal avenue also applies to other significant guardianship decisions, such as schooling choices or medical decisions like vaccinations.
Employment FAQs
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No, you cannot.
The Employment Relations Act requires employers and employees to deal with each other in good faith. This includes when you are being accused of misconduct or serious misconduct.
If there is an allegation of misconduct/serious misconduct, the employer is required provide all relevant information about the allegations, give you the opportunity to consider and take advice if you choose to, and then give you an opportunity to respond to the allegations.
Any response or feedback you give throughout this process needs to be genuinely considered by the employer before they make a decision about your ongoing employment.
If you have been accused of serious misconduct (e.g., theft, harassment of other employees), the employer is still required to go through the same process, but they may also decide to suspend you during the investigation. Again, the duty of good faith requires an employer to give you the opportunity to respond to a potential suspension before any decision is made.
If this process has not been followed, then you may have a personal grievance for unjustified disadvantage (where you have been issued a warning) or unjustified dismissal if your employment is terminated.
Our employment team can assist you– whether it’s a simple phone conversation to explain the process or attendance at meetings, we are available to help.
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Yes, but with most employment matters, there is a process to follow first.
Before you think about dismissal, you need to take steps to support your employee and understand why they may not be meeting your expectations.
This may start with a conversation with the employee, outlining some of your concerns about their performance and asking what support they need from you.
If the employee’s performance still does not improve, you can put the employee on a performance improvement plan (PIP). A PIP will outline where the employee is struggling, the employer’s expectation, steps both parties need to take to allow the employee to meet the employer’s expectations and a timeframe for improvement.
Failing improvement, the employer can consider a disciplinary process which may result in the employee’s dismissal.
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A 90-day trial period allows the employer to dismiss you during the first 90 days of your employment, and stops you for raising a personal grievance for unjustified dismissal. This allows employers to have more flexibility when making hiring decisions. A trial period can be implemented across all businesses as of December 2023.
Usually, an employer can only end employment for good reason and using the correct process. A good reason is not required when there is a valid 90-day trial period in your employment agreement.
For a trial period to be valid:
there must be a clause about the trial period in your employment agreement;
the clause must specify how long the trial period is (no more than 90 days)
you must sign the employment agreement before you begin work;
you must have had the opportunity to take legal advice about the trial period (and agreement) if you choose to; and
the employee must be a new employee for the business.
Talk to us before commencing any employment process to avoid costly mistakes. Whether you need help drafting an employment agreement, a simple phone conversation to check your trial period process, or attendance at a meeting with your staff to discuss redundancies and restructuring, we are here to help.
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In some circumstances, yes you can.
The employment agreement will need to contain a “Restraint of Trade” clause (RoT).
The RoT, when implemented correctly, can prohibit an employee from working for a competitor within a certain geographic area and/or for a specified period of time. An ROT cannot prevent an employee from working for a competitor indefinitely.
An RoT clause needs to be carefully drafted to take into account the employee’s role, the business, and what interest needs to be protected by a RoT. There have been many instances where a RoT clause has been amended or cancelled by the Employment Relations Authority or Employment Court because the RoT is goes beyond what is necessary to protect the business.
An RoT clause can be enforced by an urgent application to the Employment Relations Authority. Be aware that if your RoT is not found to be enforceable, you could be paying costs and compensation to the employee. Therefore, we strongly encourage you to seek legal advice before including or relying on a RoT.
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Yes you can, but remember that redundancy should be considered as the last option to reduce costs for your business.
Employment law is very concerned with fair process and it is important to get this right, right from the start. Before proposing redundancy to your employees, consider what alternative options are available. Can the role be amended to better suit the business’ current position, could their hours be reduced, or are there other ways the business can save on costs to get through the slump.
If it looks like making an employee redundant is the only way forward, then you can initiate a consultation process. You will need to provide all relevant information for the employee to consider, so they can provide considered and informed feedback.
You need to genuinely consider all feedback provided. You may be surprised by some of the ideas your employees come up with to both save the business (or gain money) and their jobs.
Once a decision has been made, let the employees know and if the decision is redundancy, provide their agreed notice period.
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You can ask, but you cannot demand that your employees work unless it has been previously agreed to in the employee’s employment agreement and it is a day the employee would usually work.
For these employees, they will be entitled to pay at “time and a half” (their usual rate plus half) and an alternative day off at a later time.
Estate and Will FAQs
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Under the Family Protection Act, children and some other relatives of the deceased are owed a duty of “proper maintenance and support.” In assessing this duty, the court puts themselves in the shoes of the deceased and asks what a fair and just will-maker would do.
Beneficiaries under a will or people who were disinherited (cut from the will) may make an application alleging a breach of this duty. The broad legal test means that each case turns on its own facts.
However, some general points are consistently applied. First, only in rare circumstances is it appropriate for a child regardless of their age to be disinherited. Even if that child is financially comfortable there should be nominal provision for them recognising their status as a family member. Second, young children or adult children with disabilities are likely to be owed a greater duty than those children with lesser needs. Third, if the deceased and child are estranged and the deceased is responsible, the child’s claim is strengthened.
Claims against estates need to be made 6 months after probate is granted. If you are considering making a claim against an estate you need to seek advice as soon as possible.
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This is a situation that may warrant a claim under the Law Reform (Testamentary Promises) Act.
Under the act a claim can be made for the rendering of servies or the performance of work for the deceased during their lifetime.
Claims against estates need to be made 6 months after probate is granted. If you are considering making a claim against an estate you need to seek advice as soon as possible.
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If you die intestate what happens will depend on the value of your assets.
If your assets are worth less than $15,000.00 your assets can be distributed by your next of kin without further action. If your assets are worth more than $15,000.00 your next of kin will need to apply for letters of administration. This involves applying to the High Court and asking for its permission to administer the estate. The Administration Act provides who your estate will be distributed depending on your living relatives and other relationships.
If you die without a will, effectively you have no control over how your assets are distributed. For this reason we strongly encourage our clients to prepare a will and keep it updated regularly.
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Normally your will is revoked upon marriage. There is an exception to this rule however. If your will is made specifically “in contemplation of marriage” and labelled as such it will not be automatically be revoked.
If you are uncertain about the status of your will, please get in touch.
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We do not recommend the use of will kits. A will is a vitally important document, and even minor errors can result in significant costs to your estate. Estates are often challenged by disgruntled beneficiaries or other claimants and the best way to mitigate these claims is ensuring that your will is drafted and executed correctly and addresses your wishes appropriately.
Using a will kit can be tempting for the sake of cost. However, the cost to your estate will likely come after you pass in resolving the above issues.