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27 July 2000

Changes in the air...
Welcome to Caudwells newsletter for July 2000. These articles will help you keep up with some of the many changes in the law.

Firstly, what's new at Caudwells...
Conway Powell
General Manager

A busy time for our employment team. You may have heard that Peter Churchman has moved to Wellington to take up another position. Peter's clients are being looked after by partners Frazer Barton and Jenny Beck, associate Lesley Brook and solicitors Malcolm Couling and Hamish Peart.

The employment law team is busy assisting clients in a wide range of employment law issues, including preparing for the Employment Relations Bill which is expected to come into law from 1 October 2000. This will have a major impact for many people.

Welcome to a new team member Caudwells welcomes our new solicitor Helen Scott to partner Frazer Barton's civil litigation team.

What's happening with legal aid?
The government is revamping the legal aid scheme and we expect the new regime to come into effect on 1 October 2000. This is likely to see the establishment of the "Legal Sources Agency", a government agency responsible for making decisions on eligiblity for legal aid assistance.
The revamping may change the level of involvement Caudwells and other law firms have with legal aid.

Real is for real
Caudwells Lawyers in Dunedin has joined many other law firms around the country in offering a new service to our clients.REAL will make the task of selling or buying your home much easier. 
As outlined in the enclosed REAL brochure, Caudwells can help you sell your home, or buy your new home, through our close association with REAL Ltd MREINZ, a completely new real estate company. You can expect lower real estate commissions, independent valuations and reduced legal fees when you sell your home through REAL Ltd MREINZ. 

This is explained in moredetail in the brochure. When buying or selling your home or for further information, contact your Caudwells lawyer.

Accident Compensation payments
Caudwells acts for many clients who have suffered injury by accident and are concerned they have not been receiving their rightful level of ACC compensation. In several cases this year, Caudwells have been successful in securing significant major lump sum payments from ACC. Caudwells 
specialists in ACC are based in our Dunedin office.

The death of the cross-lease?
Peter Richardson
Partner, Christchurch

The Law Commission recently recommended all existing cross-lease titles be converted to freehold (fee simple) titles or unit titles within 10 years. There are thousands of cross-lease titles in the Dunedin and Christchurch areas. Before the early 1990s most ownership flats, and properties resulting from 'infill housing' subdivisions, were created on cross-lease titles.

These titles have always had a significant disadvantage. The title is based on a Flat Plan defining the external dimensions of the dwelling and improvements (garages or carports) as originally constructed. If the external dimensions are altered or further improvements are erected on the property, a defect in title arises. Rectifying the defect involves a resurvey and legal costs.
This often results in sale contracts collapsing or being delayed, or in a seller having to correct the defect.

In our view owners of existing cross-lease properties should consider converting their titles now. Real estate agents believe the money spent on the process may be recovered on a sale of the property simply because of the superior title. The consent of all owners in a cross-lease subdivision would be required, and costs would usually be shared. We would be happy to discuss the process with you.

Where there's a will...
Warwick Deuchrass, Partner and
Greg Fahey, Solicitor, Dunedin

No one really wants to contemplate his or her death; that's human nature. But if you don't have a Will or your Will isn't up to date, you risk having your estate distributed in a way you don't intend at the time of your death. People you want to share in your estate may miss out, and people you want to exclude, may benefit.Basically, until you die you are free to revoke or alter your Will as 
you like. Upon your death, your Will crystallizes and directs how your estate and affairs should be handled.

If you die without a Will, however, the Administration Act provides a fixed formula for the disposition of your estate. Your Will might provide for the following matters:

  • Who will manage your estate;
  • Who will be guardian of your children;
  • How your property will be disposed of and to whom;
  • Your funeral arrangements.

While people can generally organise their affairs on death as they wish, the provisions of a Will can be challenged. It is important to appreciate this and to be aware that steps may be taken to ensure 
your wishes are not upset. Ways in which your Will might be opposed include:

  • A claim under the Family Protection Act - a select class of family members are entitled to challenge a will on the basis that the will does not make adequate provision for their "proper maintenance and support";
  • A claim under the Testamentary Promises Act - a person may claim against an estate on the basis they have provided services to the deceased in return for a promise by the deceased during his or her lifetime that those services would be recognised on his or her death;
  • Inter vivos disposition - even though property may be specified in a Will, it may not legally form part of the estate on death. Basically, dispositions of property in a Will are subject to the earlier disposal of property by the deceased during his or her lifetime.

Claims under the Family Protection Act are not uncommon. They may only be brought by the spouse, children, step-children, grandchildren and parents of the deceased. As for what constitutes "proper maintenance and support", this does not refer only to "economic need" of family members. The court has recognised that proper support may be due to family members as members of the family and the assistance and support they provided to the deceased during his or her lifetime. Much will depend on the size of the estate, the relations between all the parties and their respective asset positions.

Should you have specific intentions in terms of how you wish your estate to be distributed, or if you own sizeable assets, the prospect of having your Will challenged should be addressed. The 
most effective way of doing this is through an asset plan. In addition to your Will, this involves adjusting ownership of assets and/or the formation of a family trust. An asset plan provides greater certainty in terms of how your estate will be distributed.

Caudwell's offers clients a free Will preparation service. On meeting to prepare your Will we would be pleased to discuss the possibility of asset planning with you.

Personal Property Securities Update
Doreen Evans, Solicitor, Dunedin

The Personal Property Securities Register is due to commence in the second quarter of 2001. The electronic register/noticeboard will display all registered security interests over personal property.
All information required will be entered into a financing statement and submitted for registration on-line through the internet. The information required has not been finalised as yet but is likely to 

  • The name and address of the secured party (e.g. ANZ Bank);
  • Where the debtor is a person, the name of each debtor and their date of birth;
  • Where the debtor is an organisation, the name of the organisation and its incorporation number;
  • The debtor address;
  • A collateral type;
  • A serial number(s) for each item where the collateral type requires a serial number to be added (e.g. motor vehicles).

The maximum term for the security registration is five years. The term can be renewed at any time prior to the expiry date. We will keep you informed of developments in this area.

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