http://www.cairnsslane.co.nz/ Latest News en-us Sat, 19 May 2012 08:53:00 NZST Sat, 19 May 2012 09:53:00 NZST 72DPI mail@cairnsslane.co.nz info@72dpi.co.nz http://www.cairnsslane.co.nz/articles/important-points-on-gifting.html Much has been written following the abolition of gift duty last year.  There is no doubt that the removal of gift duty will simplify estate planning and can put an end to the yearly gifts to trusts which clients found so tedious. There are some important points to note however: There is still the requirement to record the gift in writing.  This is usually done by use of a simple deed of gift. Creditors' remedies are not affected and any gifts must not be done with the intention of defeating a creditor's interest. There are separate rules about gifting relating to the residential care regime and the application for rest home care and private hospital subsidies and other means tested benefits.  The  application of these rules and policies by the Ministry of Social Development have not changed and are not affected by the removal of gift duty. Three statutes contain provisions to allow claw back of gifts in relation to trusts: Insolvency Act – allows the Official Assignee to automatically cancel gifts made within 2 years of the bankruptcy, or within 5 years of the bankruptcy if solvency cannot be demonstrated at the time the gift was made. Property Law Act – the Courts can set aside gifts where it is proven the intention was to prejudice the interests of a creditor.  There is no time limit here. Property (Relationships) Act - again there are provisions to set aside gifts made where the intention was to defeat a spouse's claim.  If this was not the intention (but in reality the effect) the Court can only order compensation. So gifting off loans or transfer of assets to the family trust should only be done after careful consideration of: the type and purpose of the trust and the nature of assets its holds; the tax implications of transferring assets (eg depreciation clawback);  the personal solvency of the donor;  the need for income from the trust.  In some cases it is better to leave loans in place;  the relationship property situation of the donor;  the position of the donor in relation to the trustees of the trust and control of the trust and its assets. For many the decision to make a gift is a simple one – for others it is not.  We recommend full consideration of all legal and accounting issues before proceeding. Sun, 05 Feb 2012 NZDT http://www.cairnsslane.co.nz/articles/professional-trustees-an-endangered-species.html The New Zealand Institute of Chartered Accountants (NZICA) has recently warned professional advisors away from acting as trustees.  The reason for this warning is that the NZICA is aware of a number of cases where the Inland Revenue is seeking to recover substantial tax debts owed by a trust from a professional advisor acting as a trustee. A number of trusts in New Zealand have professional advisors (such as lawyers and accountants) acting as independent trustees – by independent this means that person is not a beneficiary of the trust and has no personal connection or interest in the income or assets of the trust.  Certainly our recommendation at Cairns Slane is that an independent trustee should be appointed as a trustee for a trust.  The appointment of an independent trustee assists in the better management and administration of the trust and assists in establishing a trust as valid and not a sham. The NZICA’s media release however, will cause professional advisors to consider the implications of their role and liability as an independent trustee.  The NZICA noted that “when a trust is not in a position to meet its tax obligations, it would seem that Inland Revenue will pursue the trustee with the deepest pockets, which will invariably be the professional trustee who has taken on the role as part of their engagement with the client.  This is despite the fact that the trustee is clearly only acting in his/her professional capacity”.  As a result of these cases, the concern for NZICA is that “the likely upshot will be that professional trustees are likely to abandon their trustee positions”. Inland Revenue had released their own media statement which appeared to have the intention of reassuring professional trustees that it was not specifically pursuing them for outstanding taxes.  However Inland Revenue did note in the same statement that “a professional trustee cannot step back from the trust’s affairs and claim that they had no liability for its actions or debts.  Lack of actual knowledge if the trust affairs does not remove liability, and whether or not the trustee is also a beneficiary, is also irrelevant.”  Inland Revenue then went on to state that “unpaid tax is the obligation of each of the trustees. Inland Revenue will not normally seek recovery from a single trustee but from all. However, if one trustee has greater assets available to satisfy the trust’s tax debt, then it is more likely that recovery will be made from that trustee” So, where does this leave the professional trustee?  Well, we at Cairns Slane will continue to provide independent trustee services to our valued clients.  And we also put great importance and take responsibility when undertaking this role.  It is clear that the role of a professional trustee is not one without risks and cannot be undertaken lightly.  A professional trustee has a duty to be properly involved in a trust’s affairs.  We believe this will ultimately benefit the trust as proper professional involvement will ensure a high standard of trust management. Sun, 05 Feb 2012 NZDT http://www.cairnsslane.co.nz/articles/case-report-sunset-terraces-and-byron-avenue-cases.html The Supreme Court decision in North Shore City Council v Body Corporate 188529 (Sunset Terraces) and Body Corporate 189855 (Byron Avenue) issued in December 2010 confirmed that the Council did owe a duty of care for leaking building matters which result in loss in value or the cost of repairs to residential units. Since the 1996 Privy Council decision Invercargill City Council v Hamlin (1996) it has become an established principle in New Zealand that Councils owe a common law duty of care in discharging their statutory responsibilities of inspection and approval. Counsel for the North Shore City Council argued that a more restrictive duty should be imposed. However, the Court upheld the principle in New Zealand that territorial authorities were liable to the original and all subsequent homeowners for loss caused by the failure of building inspectors to carry out their inspection functions with reasonable skill and care. The Court confirmed that Councils played a pivotal role in the building control process in New Zealand and there was a high expectation of reliance held by the public when acquiring residential property. Further, the Court considered it irrelevant whether owners bought from the developer or from original purchasers, and whether they were owner occupiers or rented properties. The focus was on the use of the premises, not on what relationship owners have to their premises. Tue, 20 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/relationships-arent-easy.html .. and they certainly don't get any easier when you have to talk about money. Claire was just such a person and didn't want to risk putting a "dampener" on her new relationship by discussing with her partner what would happen if they separated or one of them died. Claire owned her own home prior to the relationship and her partner moved in. Eight years later he was moving out and asking for half of the house. Many people think that what property they own prior to a relationship is theirs and that on a separation would not have to share it with their partner. This is not so – as Claire found out to her cost. Don't leave it until a separation to find out what your position is. Talk to us as early as possible. There are many ways to protect your assets in such situations and not all of them cost an arm and a leg! Tue, 20 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/when-parents-go-into-care.html Joan lives with her parents providing them companionship and care in their old age. Over the years Joan has made financial contributions to the property and has paid for alterations to the house. Mum dies and Dad requires rest home care as Joan can no longer care for him on her own. Joan has not had her financial contributions to the property recognised legally. Dad is assessed for a rest home subsidy and must pay for his own care from his assets. Joan's situation is not taken into account and Joan now risks losing what should have become her share of the home and possibly her inheritance. There are ways Joan and her parents could have avoided this situation but these steps should have been taken when Joan first began making financial contributions to the property. Group ownership of property amongst families is becoming increasingly common and there are safeguards that can be put in place to protect all parties. Sometimes the solutions need to be quite creative. Talk to us early to avoid unnecessary complications later on. Tue, 20 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/dos-and-donts-your-staff-do.html Employers and employees alike should exercise a small measure of caution at work functions. Employees: Be sure not to cause "embarrassment" to your employer! Unruly, offensive behaviour at a work function attended by people outside your organisation could lead to your justified dismissal if your actions caused embarrassment and disrepute to your employer. Employers: Be careful about your venue, if may be better to have your party offsite. For instance it may not be advisable to have alcohol consumed in a workplace where there are dangerous goods and machinery. Should an intoxicated person attending the function directly, or indirectly, cause an accident resulting in the injury of an employee, you could well find yourself liable under the Health and Safety in Employment Act 1992. Tue, 20 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/consigned-goods-under-the-personal-property-securities-act-ppsa.html It is generally well known that since the Personal Property Securities Act (PPSA) came into force, retention of title clauses are no longer of themselves sufficient to protect suppliers, and registration under the PPSA is required to perfect a supplier's interest in those goods. What is less well known is that goods supplied on consignment also come under the PPSA requiring registration to perfect a consignor's interest. Supplying goods on consignment generally has goods delivered to a customer and stored at their premises, with no obligation on the customer to purchase any of those goods until they order them. It is only on an order that a customer becomes contractually bound to purchase the goods stored at their premises and generally, before the goods are ordered a supplier is at all times able to uplift the goods. If the supplier does not register their interest in the consigned goods under the PPSA, on a customer's receivership the supplier will not be able to reclaim those goods and the goods may be taken under the receivership. What this means is that if a supplier does not register its interest, a customer can grant to third parties better rights (i.e. rights of ownership) to the consigned goods than what the customer itself has in those goods. If you are a supplier of goods, and especially a supplier of goods on consignment, make sure that you contact us to ensure your terms of trade protect you. Tue, 20 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/the-art-of-positive-cashflow.html Positive cashflow is integral to any business. It can mean the success or failure of your business and may hinge on whether your debtors pay you. There is no one solution for maintaining a positive cashflow but there are a number of essential checks you can implement to keep your business in the black. Top Ten Tips for Positive Cashflow Ensure your documentation (eg contracts, terms of trade, credit applications, terms and conditions) properly reflect your business policies. Train your staff in relation to your policies. Credit and sales departments are often seen as working towards different goals and targets. It is important to keep these two teams within your organisation in communication and working together. It is ineffective to sign up new clients if they do not pay you. Ensure customers properly complete your documentation and that you obtain and retain all documentation on file – you will need these to "prove" your debt. Obtain guarantees wherever possible. Conduct appropriate searches to verify customer details. Consider whether any security should be obtained eg a charge of real estate or other assets. Set credit or other trading limits where appropriate and monitor them closely. Maintain communications with your debtors so you know what they are doing and if there are any changes to their circumstances. Monitor any "warning signs" of financial trouble from your customers before they become debtors. These signs include: bounced cheques broken instalment arrangements non return of phone calls. Make a note of these "signs" in a central database or file for each customer. Time is of the essence – act quickly to recover your debts. Remember that they key to positive cashflow is positive action! For further information on ways to reduce your bad debtors, improve your cashflow and keep your business in the black, call us today. Tue, 20 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/give-credit-only-when-it-is-due.html This is a message to our trader, retailer and supplier clients. Start thinking more like a bank when giving credit to your customers. Many suppliers give large amounts of credit to customers – often on the basis of having a lengthy business relationship. Your bank does not think so generously – and neither should you. Banks are very careful about examining your history and financial position before giving you credit and take as much security as possible for advancing funds. This places banks in an enviable position when things go wrong with their customers. Suppliers often take a much more lenient approach relying on previous business relationship history or at best terms of trade to protect them. Having terms of trade is only the start. Business owners must follow through on the protection their terms of trade offer them. Business can be tough – so give yourself the best chance of getting paid. Review your terms of trade: What security does it allow you to take? Take the security – don't just rely on the right to take it. Often it is too late to protect your position once the customer is in financial difficulty. To register a security charge against your customer on the PPSR (Personal Properties Securities Register) only costs around $3 but can greatly increase your rights to your goods taken but not yet paid for. Guarantees – they can seem possible – but look at the substance of the guarantor. Banks require statements of financial position before lending, so make sure you know the financial viability of not only your customer but the persons you are taking guarantees from. Have a policy for credit over a certain limit and stick to it. Make sure all your documentation has been fully and correctly signed and keep copies. Tue, 20 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/asset-insurance.html We are all tired of hearing of finance company and other business collapses. To rub salt into an investor's wound – what often emerges from these cases is the news that the directors are not personally financially affected to any large degree. There are reasons for this. These people have taken the time and trouble to consult lawyers and put in place asset and estate plans, usually involving trusts, that among other things insulate them personally from the impact of their own business failing. By transferring assets into a trust, an individual can protect his/her assets from potential claims by creditors. There is nothing illegal in this if done properly, in a timely way, and not done to defraud one's creditors. Think of it as insurance. We think it prudent to insure our cars and homes – even our incomes and health and lives. While there are always ongoing costs in establishing and maintaining such insurance, we are very grateful to have the benefit of it if misfortune strikes. Prudent estate and asset planning can be viewed as insuring your personal assets against business risk. There are additional benefits to such planning including insuring your family and family assets against the risks posed by spendthrift children, or the risk of their partners claiming a share of your hard-earned inheritance assets, the maintenance of children or grandchildren suffering disabilities and protection against user pay charges. So next time you are wondering how the latest "name" can retain his million dollar house and Ferrari despite the collapse of his business, remember he just took the trouble to reorganise ownership of his assets. Tue, 20 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/enduring-powers-of-attorney.html New Rules New rules now apply to the granting, execution and witnessing of enduring powers of attorney. Essentially the legislation changes have been designed to increase the protection of donors. Ruth Dyson as Minister for Senior Citizens noted that the thrust of the new legislation is to ensure "that the interests of the donor are paramount in all aspects of powers of attorney; and even where a donor loses capacity and the decision making role has passed to the attorney, the donor still has the right to be consulted." Briefly the changes mean: The new forms are much longer and require more information from a donor and thorough examination of the donor's personal and financial situation. More detailed advice as to the effects and implications of granting the enduring power of attorney will be required to be given to a donor. In addition in some cases a donor will need to be advised by another solicitor. Only solicitors and registered legal executives can witness enduring powers of attorney. New certification procedures apply for witnesses and health practitioners certifying as to the loss of mental capacity. Consequently legal costs on completing enduring powers of attorney will increase. There is no doubt that cases of misuse of enduring powers of attorney do occur. Unfortunately such misuse is more to do with the calibre of the person chosen by the donor to be their attorney than the content of the form appointing the attorney! It remains to be seen whether the changes to the legislation will provide the protection to donors as intended. Tue, 20 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/unit-titles-act-2010.html The Unit Titles Act 2010 covers how unit title developments are created and managed and, importantly, the rights of unit owners and how they can exercise those rights. Unit titles are the most widely used form of multi-unit property ownership. They allow owners to privately own an area of land or part of a building and share common property with the other unit owners. This combination of individual and shares ownership of land and buildings, often in an intensive built environment, means owning a unit title involves a different set of rights and responsibilities than traditional housing and land ownership. In addition, unit title developments have a body corporate management structure to ensure decisions affecting the development can be made jointly by the unit owners. This can be challenging at first for anyone not used to communal ownership. Transition under the new Act Most of the provisions of the Act will apply from June 2011, with the other provisions applying from the end of a 15 month transition period. The transition period gives bodies corporate time to prepare for the new maintenance requirements and new default body corporate operational rules contained in the Act. An existing body corporate can opt-in to these new requirements at any stage before the transition period expires. Existing body corporate rules Body corporate rules made under the Unit Titles Act 1972 will continue to apply during the 15 month transition period. However, many of the provisions in these existing rules will be overridden by the 2010 Act. The default body corporate rules are currently set out in the schedules to the Unit Titles Act 1972. Under the 2010 Act, the default body corporate operational rules will instead be set out in the regulations. These new default rules will be reduced in scope, as many matters previously governed by the rules are now set out in the 2010 Act itself. From June 2011, provisions in the 2010 Act will override the corresponding provisions in existing body corporate rules, including the provisions relating to: • the duties of owners and the body corporate; • the operation of the committee; and • meetings and voting. This does not apply to rules covering the body corporate's maintenance obligations, which are also covered by the transition period. Bodies corporate should review their existing rules to determine which will apply during the transition period and which have been overridden by the 2010 Act. New body corporate operational rules The new default operational rules prescribed by the regulations made under the 2010 Act will apply once the transition period expires. Bodies corporate will be able to revoke, amend or add to the default rules set out in the regulations, and should use the transition period to prepare any changes to the new rules that they consider necessary. Changes cannot be made to any of the matters that were in the existing rules and are now set out in the 2010 Act itself. Maintenance requirements Under the default body corporate rules in the 1972 Act, a body corporate is responsible for maintaining the common property as well as utilities serving the units. The 2010 Act expands the maintenance requirements for bodies corporate, but these new requirements will only come into force after the 15 month transition period. On expiry of the transition period, a body corporate's responsibility for maintenance will cover the common property, as well as all building elements and infrastructure which serve more than one unit. Bodies corporate will also be required to set up a long-term maintenance plan and establish a fund for that plan. If you have any questions about the new Unit Titles Act and the implications for your property or body corporate, please contact us. Tue, 20 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/property-pitfalls.html From time to time we come across unfortunate examples of where property transactions can come to grief. More often than not, these can be avoided by having us check agreements before signing. Here are some examples of when good deals go bad. Some trusting clients have accepted real estate agents' assurances that they don't need their lawyer to check their property agreement before signing because the agreement may have a "requisition" clause – however this is not as water tight as you might think. There are a couple of myths that should be dispelled ... Myth One client was told that if their solicitor checked the title after they signed and found something was not satisfactory then they could cancel the agreement using the requisition clause (a requisition clause allows the agreement to be cancelled if the title has serious defects or restrictions and the vendor cannot or will not rectify them). Fact There are many restrictions on titles that you cannot requisition or it is not clear whether you can or not. Serious title defects that allow cancellation of an agreement are in fact very rare. Myth Another client was told that a solicitor's approval clause the agent put in the agreement meant they could cancel if there was anything about the title or transaction that was unsatisfactory. Fact The Courts are very reluctant to allow an agreement to be cancelled even though the clause says it can be. This is because the purchaser should not have signed the agreement if they did not want be bound by it at the time of signing. The range of grounds for a solicitor withholding approval are in fact extremely narrow. Myth Some agreements contain conditions that are "automatically satisfied" if written notice is not given by a certain time. Fact Agreements should never contain clauses like this. Moral of the story We strongly advise you to fact a copy of your proposed agreement to us prior to signing so that we can quickly check it and conduct an internet title search before you sign. If you do sign an agreement before sending it to us, simply ring us immediately so that we can make sure it is faxed to us promptly so there is time to try and satisfy conditions. We have had instances where we have not received agreements from agents for five days and condition dates have passed by the time we get the agreement. Mon, 19 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/forming-a-company-creates-a-raft-of-responsibilities-and-potential-penalties.html Filing annual returns The annual return is an update of the registered office, directors' names and addresses, shareholders, the date of the last annual meeting, and whether or not shareholders unanimously agreed not to have accounts audited. In the last few years the Companies Office has become very attuned to clearing dormant companies off the register. Failure to file an annual return is the first signal to the Companies Office that a company is dormant. Property held by companies when they are removed from the register is vested in the Crown. The Companies Office contacts companies to remind them the month before their annual returns are due, but if the email or postal address you have given them is no longer current, you won't receive it. At the end of the month following the due date, the Companies Office emails final reminder notices to the main email address given and posts them to each director. The following month, if the annual return has still not been received, the company can then be removed from the register. Company records A number of documents, including the company's constitution, share register, director's register and the last seven years of director and shareholder minutes of meetings and resolutions, must be kept at a company's registered office. Maximum penalty: $10,000 fine for the company and $10,000 for every director. Notice of change of directors' addresses It is quite common for the Companies Office not to be informed when a director has a change of address: many directors are unaware that they might be liable for a $10,000 fine for not updating that information within 20 working days of the change. Maintain share register Your company share register is required to state the names and last known addresses of everyone who is now or has in the past 10 years been a shareholder, the number of shares they hold, and the date of share transactions. Maximum penalty: $10,000 fine for the company and $10,000 for every director. A few years back a New Zealand couple established a company whose sole purposes for existing was its $10,000 investment in a winery. When the couple moved to Australia the company technically had international shareholders, which meant they needed to file audited accounts. They didn't do so quickly enough and were fined a total of $14,000. That's for a $10,000 investment, remember, and doesn't include legal fees. Contact us if you have any questions about your company's compliance obligations. Mon, 19 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/leaky-buildings.html Leaky buildings are constantly in the news yet are still being bought and sold. "Buyer beware" is the catch-phrase here! We are aware of numerous leaky apartment buildings and a quick call to any of our property team would be a good place to start if you are in the market for an Auckland apartment. If there is any chance that the property you are buying could be leaky then you need a robust condition in your sale and purchase agreement enabling you to cancel if you obtain advice from a qualified person that the property could be leaky. If you do inadvertently buy a leaky building you may have to sell at a huge loss or pay the cost of repairs and litigation. Please do contact us if you have any concerns a property you are interested in may be a leaky building. Mon, 19 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/personal-property-securities-act.html Renew to maintain your priority The Personal Property Securities Act 1999 has been in effect now since 2002, and provided a system for security holders to register a financing statement on the Personal Property Securities Register (PPSR) to retain their security priority. However, these financing statements expire automatically after five years (or earlier, if a shorter term was specified on registration). In order to maintain their priority, financing statements must be renewed before they expire. This means that if you registered a financing statement five years ago and chose the automatic expiry date option, that financing statement is due to expire (and may already have). We also note that the Ministry of Economic Development will not be providing reminders! If you are concerned about the status of your security interests you can access the PPSR website at www.ppsr.govt.nz, or simply contact us and we will help you immediately. Mon, 19 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/is-it-time-to-revise-your-will.html It is difficult to know when to revise your Will. Remember that when you make a Will, it is expressing your wishes at a specific point in time. As your circumstances change, the Will may no longer reflect your wishes. There are certain changes that should prompt you to consider revising your Will. Some of these include: buying or selling assets (a house, business, boat etc) the death of your spouse getting married separation or divorce starting a de-facto relationship the birth of children or grandchildren your children marry, separate or divorce or enter into a de-facto relationship your proposed executor has become ill or died you are contemplating retirement beneficiary named in your will has died a beneficiary is in financial difficulty. We recommend that you review your Will regularly. If you think that it might be time to review your circumstances with an independent person, do contact us and we will help ensure that your Will does accurately reflect your current wishes. Mon, 19 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/nothing-succeeds-like-succession-planning.html Like insurance and a will, succession is not something you put in place at the point in time when you 'need' it - succession is something a good business has in place all along. Establishing a sound business succession plan is beneficial for most business owners. For business owners that are at or near retirement, the issue of succession cannot be ignored. Succession is the process of passing on the active management of a business in such a way that the business continues with minimal or no disruption when the change in management (and possibly, but not necessarily, ownership) takes place. The process should include not only a plan, but the actions necessary to make it happen. The day succession is needed is not the day to put it in place. It should be in place now. An established succession plan means: that the business is not dependent on the day-to-day physical presence of the owner/manager for its continued profitable growth. In practical terms, it means that the owner/manager has time to spend with family and friends, time for well-earned vacations or perhaps even time to start another business. It means that the business employs knowledgeable, motivated people. that if the owner/manager dies or becomes disabled his or her family and employees are not left unprotected. The business will continue in an orderly fashion. that the necessary financial and legal elements have been secured with the assistance of qualified professionals: accountants, lawyers and financial planners. These elements will include some or all of the following: insurance a will shareholders' agreement tax and retirement planning Contingencies should include not only the certainty of death and the possibility of disability, but steps taken now can help in the financing of a future sale to a third party, existing management or the next generation. that if the owner/manager chooses to sell the business at some point, the pool of prospective purchasers can include investors who do not immediately have the skills necessary to manage the business or who perhaps have no intention of ever managing it. A larger pool of potential purchasers means a higher price. That at the point the owner/manager wants to retire, the business does not have to be sold. The 'owner/manager' can simply transition to being the 'owner' - because management is in place. Remember, it is never too early to begin planning succession issues. Fri, 16 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/should-i-have-a-shareholders-agreement.html When you go into business with other people, have you contemplated what might happen in hard times as well as the good times? Any time more than one person is involved in running a company, the possibility for a dispute arises. Having a framework to work within protects the value of the company and can avoid misunderstandings. An effective method of achieving this framework is through a shareholders agreement. What is a shareholders agreement? A shareholders agreement is a legally binding and confidential contract between the shareholders of a company. It creates additional rules and obligations beyond those of a company's constitution and the Companies Act 1993. The agreement can be tailored to your business and be as simple or and in-depth as you need. Who needs a shareholders agreement? Shareholders agreements are most appropriate for companies owned by a small number of owners, whether those owners are friends, family or independent investors. Benefits Controlling who shareholders are, by including pre-emptive provisions – that may give all existing shareholders the first right to purchase the shares of an exiting shareholder. Recording an agreed set of business decisions – such as the issue of new shares, the buying or selling of a major asset or a material change in company's business. Providing for a dispute resolution process and a mechanism to deal with deadlock situations. Although best prepared at the outset of the business relationship, a shareholders agreement to protect your business can be prepared at any time. Contact us if you would like to discuss whether a shareholders agreement is right for your business. Fri, 16 Sep 2011 NZST http://www.cairnsslane.co.nz/articles/what-have-my-parents-got-to-do-with-my-will.html Let’s assume for a moment that you have the perfect estate plan in place ... Your Will creates testamentary trusts for your spouse, children and grandchildren for maximum tax effectiveness and asset protection You have documents that implement a succession plan for your companies, trusts and business partnerships Your life insurance is under control and you know it will benefit your family in the most efficient way You’ve named guardians for your children if they are under 18 You’ve even made an Enduring Power of Attorney so that legal, financial, medical and lifestyle decisions can be made for you if you lose capacity. Whew! You’ve put a lot of thought into these documents. Surely now you can rest easy – you’ve covered all bases and there's not a thing left to do. Right? Wrong! In some cases, even a carefully tailored estate plan can be thrown into disarray by external factors. An example we commonly encounter is when a client receives a substantial inheritance from their parents. Estate planning can be a touchy issue. Because it can be awkward to discuss the topics of death and inheritance, many people avoid raising the issue with their parents. But it is important for you and your parents to make sure appropriate plans are made for the future. If you own a business or work in a profession where asset protection is an issue, it is vital to ensure that your parents' estate plan has taken your circumstances into account. Otherwise, a large part of your parents' hard-earned wealth could potentially disappear into the hands of your creditors. But if your parents undertake some careful estate planning and establish testamentary trusts, these unwanted consequences should be avoided and your parents can make sure that after their death their assets will be protected for the benefit of you and your family. Even if you are not one of these "at risk" people, it can be a huge benefit to you and a great comfort to your parents if their estate plan has been made with your situation in mind. Call us if you want to know more. You might also like to ask your parents to arrange an appointment with us! Fri, 16 Sep 2011 NZST