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Newsletter - Autumn 2015
Latest Webb Farry News
AS Gallery Exhibition solicitor in both Wellington and Nelson. She is Sponsorship / Supporters Tickets
As previously announced, in collaboration with an experienced practitioner and can assist with We are proud to continue our support of the
the Dunedin School of Art we are now the proud property law, trusts and commercial matters. Southern Sinfonia as Chair Sponsor of the
location of the AS (Alternative Space) Gallery. She also has particular expertise in regulatory Principal Percussionist. We are also proud
The reception areas of our Dunedin premises legislation including resource management, local supporters of the Otago Highlanders and
will be displaying exhibitions which are updated government legislation and issues concerning accordingly have Open Club Reserve tickets to
every four months. Currently on display is a public land. Forsyth Barr Stadium.
series of paintings “Pool” by Miranda Joseph.
This exhibition will run until the end of July Mosgiel Office If you are a client of our firm and are interested
2015 (please see insert for further details). The Please see below current details for our Mosgiel in attending either a Southern Sinfonia concert
gallery space is open to the public during Webb team: or Highlanders’ home game on a complimentary
Farry’s office hours. Chris Hawker – Monday to Friday basis, please contact Tracy Stevenson on (03)
John Summers – Mondays, Tuesdays, Thursdays 477-1078 to register your interest.
New Employee (and Fridays by appointment)
We are pleased to welcome Shelley Chadwick to Melanie Hayes – Wednesdays
our Commercial / Property team. An Otago John Farrow – Thursday mornings
graduate, Shelley has previously worked as a Megan Bartlett (Fridays by appointment)
Trust law: trustees’ duties – are you at risk?
You might have been blindly agree with and follow the instructions of for any loss caused, particularly if it was an
asked by a friend or the remaining trustees or settlors; trustees must intentional breach of trust, dishonesty or
family member to carefully consider their decisions. negligence that caused loss. If a trustee can
be an independent demonstrate that he or she acted honestly and
trustee of a Trust. Trustees have a duty to make prudent in good faith and that the breach of the terms
You may also have investments. This duty applies to the methods of the Trust was unintentional on their part,
been appointed as an trustees use to make the investment, that trustee would not ordinarily be liable to
executor of someone’s rather than looking at the actual results of the beneficiaries for the consequences of their
estate, which will that investment. A failed investment is not breach.
often also make you a necessarily a breach of trust as long as the
trustee of the estate trustees acted prudently when choosing that When a Trust enters into a contract with a third
assets. investment. party the trustees will typically be personally
liable to ensure that the contract is completed.
Trustees have strict duties to the beneficiaries Trustees must be impartial. They must consider They may have a right to be indemnified from
of the Trust. Most duties are contained in the the needs of each beneficiary and have a duty to the assets of the Trust (meaning the liability
Trustee Act 1956. In certain situations trustees manage the Trust assets in the best interests of they incur will be paid for from the Trust assets);
can be held personally accountable for their those beneficiaries in accordance with the terms however they will lose that right of indemnity
actions or for failing to act, so it is important of the Trust deed or Will. Trustees must avoid if they act in excess of their Trust powers or in
trustees understand their rights and obligations. being in a position of conflict between their breach of their Trust duties. In addition to this,
duties to the Trust and its beneficiaries. any right to be indemnified is only useful if
All trustees must know the terms of the Trust (or the Trust actually has realisable assets. Recent
the terms of the Will as the case may be), and Trustees are accountable to beneficiaries. They case law has seen an independent trustee
must ensure the Trust (or Will) is managed in an must keep proper accounting records and may personally liable for Trust IRD debt, as the
efficient and economic manner. Trustees should be required to give beneficiaries information remaining trustees had fled the country. While
take all precautions that an ordinary prudent and explanations as to the investment of and the independent trustee had the right to be
business person would take in managing similar dealings with the Trust property. indemnified, there were no Trust assets left to
affairs of his or her own – a trustee must act cover the debt. The independent trustee paid
with care and diligence. An independent trustee A breach of trust by a trustee can mean he the IRD debt using their own funds.
is not a ‘rubber stamp’, meaning they must not or she is personally liable to the beneficiaries
Webb Farry’s solutions are always “The various teams within Webb Farry
pragmatic, reflecting our awareness work together seamlessly to facilitate
that strategies must be cost transactions and ensure your interests
are always protected.”
efficient if they are to successfully
meet your objectives. Megan Bartlett LL.B, B.A
Solutions With Flair Partner
79 Lower Stuart St, Dunedin • 107 Gordon Rd, Mosgiel • www.webbfarry.co.nz • 03 477 1078 • lawyers@webbfarry.co.nz • DX YX10151, Dunedin
Work life and private life – implications of social media
In the last decade the use of social media has Facebook page. Ms Rolston made various Ms Blylevens challenged her dismissal. The
exponentially expanded. Social media such comments in two separate posts about Kidicorp, ERA found that her dismissal was justified. Ms
as Facebook enable users to interact with including allegations of Kidicorp “removing Blylevens’ explanation that her ‘likes’ did not
large numbers of people, with immediate and unwanted staff”, “bullying”, describing HR as endorse or support Ms Rolston’s derogatory
permanent impact. Users of social media might the “vindictive Kidicorp HR Krew” and stating posts was not accepted. The ERA likened Ms
assume that their use of sites such as Facebook that Kidicorp created a “toxic” environment. Ms Blylevens’ actions in ‘liking’ and commenting on
in their own time has no relevance to their work Blylevens ‘liked’ Ms Rolston’s posts, and added the posts to her standing outside the childcare
life; however, the impacts of the use of social her own comment to one of them, noting that it centre and handing out copies of Ms Rolston’s
media can overflow from a user’s personal life was “an interesting article” and “that as a parent derogatory comments about Kidicorp while
to their work life, with serious effects on both looking for childcare it’s good to be informed”. telling people “here is an interesting article – it is
employee and employer. good to be informed”. The ERA had no difficulty
Ms Blylevens was identified on Facebook as in finding that Ms Blylevens’ actions breached
The effects of the use of Facebook in an an employee of Kidicorp, and her Facebook her employee obligations of fidelity, loyalty and
employee’s own time were recently illustrated friends included other Kidicorp staff and parents. good faith.
in an Employment Relations Authority (ERA) Ms Blylevens’ ‘like’ of the posts ensured that
decision Blylevens v Kidicorp Limited [2014] Ms Rolston’s derogatory comments were This case clearly illustrates the need for
NZERA Auckland 373. Kidicorp employed Ms disseminated to a wide audience. Kidicorp had employees to be mindful that their use of social
Blylevens as a centre manager. A number of a social media policy that prohibited employees media in their private capacity and in their own
staff and parents made complaints about Ms from posting information that could bring time may have unexpected implications for their
Blylevens, which Kidicorp investigated. Kidicorp into disrepute or that could cause employment. This case also provides employers
reputational damage. After Kidicorp became with some assurance that if an employee is
During the investigation Ms Blylevens sought aware of Ms Blylevens’ actions in ‘liking’ and using social media in a way that may damage an
assistance from an advocate, Ms Rolston. While commenting on the derogatory posts, an employer’s reputation, an employer can consider
representing Ms Blylevens, Ms Rolston posted investigation was launched. Ms Blylevens was disciplinary action.
derogatory comments on her own business dismissed for serious misconduct.
Becoming a permanent resident in New Zealand
The process to apply and become a permanent • Skilled Migrant Category - based on
resident in New Zealand can be complex, difficult specialist skills, qualifications or experience.
and expensive for some. Depending on your The person must also be aged under 55
skill base and financial status this process can years and meet English language, health and
be fast-tracked if your skills and investment are character requirements,
sought after. • Work to Residence Category - for people that
have worked for two years on a work visa,
New Zealand permanent residents are non- meet health and character requirements and
citizens who hold a permanent resident visa. are from an English speaking background,
A visa is an endorsement given by the New • Entrepreneur Work Category - for people
Zealand Government that the non-New Zealand that want to move New Zealand to buy or enough time in the country, becoming a tax
citizen is allowed to enter, leave or stay in New start their own business, resident, owning a business, investing in New
Zealand for a specified time and on specific • Investment Category - for people that want Zealand or establishing a base).
conditions. to invest a large amount of money in New
Zealand, A permanent resident visa holder is entitled to
There are three types of visas granted in New • Family Category - for partners, children or be granted entry permission into New Zealand
Zealand under the Immigration Act 2009. Transit parents of New Zealand citizens or resident at any time whereas a resident visa holder is
Visas, Temporary Entry Class Visas (consisting of visa holders, only entitled to apply for entry permission, and
temporary, limited and interim) and Residence • Samoan Quota Category - for Samoan the usual rights granted to them in New Zealand
Class Visas (resident and permanent resident). Citizens, or (which include: stay in New Zealand indefinitely,
• Pacific Access Quota - for citizens of Tonga, work or study in New Zealand, receive free
New Zealand permanent residents are not New Tuvalu or Kiribati. health care etc.) only become effective if entry is
Zealand citizens and therefore are not afforded granted into New Zealand.
all the natural rights New Zealand citizens enjoy, Once the non-citizen has held the resident visa
which include standing for public office, being for a period of two years, and held their resident The costs for applying for a resident class visa
entitled to New Zealand consular protection and visa in the last three months consecutively prior vary depending on the non-citizen’s country of
never being deported from New Zealand. to applying, they may apply for a permanent origin and whether the application is lodged in
resident visa. The non-citizen must meet criteria or outside of New Zealand and the category in
The first step towards gaining permanent confirming that they are of good character, meet which the resident class visa is sought. If you
residency is to be accepted to apply for a any conditions that the resident visa was subject have any queries or wish to seek assistance in
resident visa by Immigration New Zealand. The
categories that you may apply under consist of: Solutions With Flair
to and have met one of the five commitments
to New Zealand criteria (which are; spending
order to gain residency, please contact us to
discuss.
79 Lower Stuart St, Dunedin • 107 Gordon Rd, Mosgiel • www.webbfarry.co.nz • 03 477 1078 • lawyers@webbfarry.co.nz • DX YX10151, Dunedin
New Zealand’s extradition laws – Law Commission review
The Law Commission released its Issues Paper, The Paper recommends extradition laws be function of this legislation in terms of
“Extradition and Mutual Assistance in Criminal simplified to a two category approach, with assisting foreign countries to conduct
Matters” on 2 December 2014, with submissions one set of procedures and requirements for searches and surveillance under our
on the Paper’s preliminary proposals open until 2 New Zealand’s closest extradition partners, and domestic framework, and
March 2015. another set for all other countries.
• simplifying the current framework so as to
The Paper examined the Extradition Act 1999 MACMA allows foreign countries to request New give effect to New Zealand’s international
and the Mutual Assistance in Criminal Matters Zealand’s assistance in criminal investigation and commitments.
Act 1992 (MACMA), concluding that both need prosecution. Paper recommendations include:
reform to meet the challenges posed by a
modern globalised world. • making MACMA more principle orientated
and less technical so as to widen the
What is a General Security Agreement?
You may have been asked to enter into a General ‘secured moneys’). This will include collateral • If the GSA covers farm land, you must farm
Security Agreement (‘GSA’) to provide security liability and the costs of enforcement. and manage the land in accordance with
over your assets to a third party, before that established practice, including keeping
party will advance you money, goods or services. What if I default? the land clear of all weeds and noxious
What does this mean? The primary remedy of a GSA is that if you are in plants, animals and insect pests and taking
default of your obligations, the secured party can reasonable steps to control disease, crops,
What is a General Security take possession of and sell the secured property. pastures, plants and stock.
Agreement? If a Company defaults on a GSA, the secured • You must not sell any secured property,
A GSA is a common form of security often party can appoint a receiver (in accordance with nor alter or remove any improvements, nor
used to secure commercial loans or credit the Receiverships Act 1993) to manage the deal with any resource consent that affects
arrangements. It can be an effective way to company’s affairs. The receiver is then able to secured property without the secured
obtain security over the assets owned by a sell off Company assets in order to repay debts party’s consent.
person or company. to the secured party. • If a Company enters into a GSA they must
not materially change the control of the
When entering into a GSA with your bank, you Your obligations Company without first obtaining the secured
or your company will often be asked to provide To avoid defaulting under the GSA you will party’s consent.
security over all of your present and after- need to ensure you do not breach the specific • You must pay all rates, taxes, charges and
acquired property, meaning the bank will have obligations imposed under your agreement. other outgoings in relation to all secured
security over everything you own now and Key obligations of the commonly used Auckland property, must repair and maintain all
everything you will own in the future. A bank District Law Society GSA include: improvements and must adequately insure
could, for example, require a GSA from you or • The obvious (but sometimes overlooked) all secured property.
your company to secure loan monies advanced obligation to pay to the secured party the
by the bank. secured moneys owed to them under any A GSA is a complex legal document that imposes
agreement, in accordance with the terms of onerous obligations. It can provide powerful
When entering into a GSA with one of your that agreement. wide-ranging powers to the secured party to
suppliers, you will typically provide security • You must not allow anyone else to take take control of your assets to recover moneys
over just some of your assets, often the assets security over any property a secured owed if a GSA is breached. With this in mind, a
that they supply to you together with the sale party already has security in, without first GSA should not be entered into lightly. Where in
proceeds of such assets. obtaining the secured party’s consent. As a doubt, please contact us for legal advice.
practical example this will mean you may
A GSA will usually secure all moneys owed to need your bank’s consent before you open a
the secured party now and in the future (called line of credit with a supplier.
“In an ever challenging business environment – where restructurings and
rising compliance costs are commonplace – our team is clear-headed,
pragmatic and focused on your commercial objectives.“
David Ehlers LL.B, B.Com
Partner
Solutions With Flair
79 Lower Stuart St, Dunedin • 107 Gordon Rd, Mosgiel • www.webbfarry.co.nz • 03 477 1078 • lawyers@webbfarry.co.nz • DX YX10151, Dunedin
For companies – an overview of voluntary administration, receivership and liquidation
When a company is in financial difficulty, it might b) that administration should end, or circumstances, a receiver may still be appointed
enter voluntary administration, receivership c) a liquidator be appointed where one has not by a secured creditor.
or liquidation. There are important differences already been appointed.
between these processes, as outlined below. Liquidation
Depending on the outcome of voluntary Where a company is unable to pay back its debts
Voluntary administration administration and the watershed meeting, this it may go into liquidation; this is the point of no
Under Part 15A of the Companies Act 1993 (‘the process may allow the company to resume all return for a company.
Act’), an administrator may be appointed to a or some of its business once it has ended, and
company by: provide real benefit to the company in terms of A liquidator can be appointed by the
• its board, compromise with creditors, and future direction. shareholders, board of directors or creditors of a
• a liquidator or interim liquidator where the company, or by court order.
company is in liquidation, Receivership
A liquidator takes control of a company’s assets
• a chargeholder with an enforceable charge Where a company has provided security over
primarily for the benefit of unsecured creditors,
over all, or substantially all of a company’s company assets to a creditor, and the company is
but appointment of a liquidator does not affect
property, or in default of its obligations under the terms of the
the rights of a secured creditor in respect of
• in certain circumstances the court. security agreement, the secured creditor (e.g. a
secured assets.
bank with a General Security Agreement over the
This administrator takes control of the company assets of the company) may appoint a receiver. A liquidator’s primary role is to bring in all the
from the directors and reviews the operation of
assets of the company and distribute them to
the company during a 20 working day period. A receiver acts for the benefit of the secured
the creditors of the company in accordance with
creditor in respect of the secured property, and
the Act. The liquidator also has further duties,
After this period, a “watershed meeting” is held other creditors should be mindful that a receiver
such as duties in respect of providing reports to
to decide the future of the company. By this does not act for their benefit.
the creditors and shareholders of the company
time, the administrator will have considered the
A receiver’s powers are governed by the throughout the process.
interests of the creditors of the company moving
Receiverships Act 1993 and the specific terms
forward. During the liquidation process, the directors of
of the creditor’s security arrangement with the
the company have very limited powers. The
At the watershed meeting, the creditors may company. For example, a receiver may demand
net effect of liquidation is that the company is
decide: and recover the income of any secured property
ultimately struck off the Register of Companies,
a) that the company execute a ‘deed of from a company.
and can no longer trade.
company arrangement’ governing how the
Importantly, even where an administrator
company’s affairs are to be dealt with and
has been appointed for a company, in some
dealing with creditors’ claims,
Traffic law - can you bike home from the pub?
You cannot be charged with a drink driving without a motor is not considered a motor driving, are not restricted to your activities with
offence under New Zealand law while riding a vehicle (see Lawrence v Howlett [1952]) nor is vehicles that have motors. Someone cycling
bicycle, unless it has a motor. Excess Breath/ a bicycle with an electric motor of less than 300 home under the influence could be charged
Blood Alcohol (EBA) charges only apply if you watts (see NZ Gazette 25 July 2013). with careless driving if it can be shown they
drive or attempt to drive a motor vehicle, have used their bicycle carelessly or without
meaning a vehicle drawn or propelled by However, this is not without risk. While EBA reasonable consideration for other persons (see
mechanical power (see sections 2, 11 & 12 of charges can only apply while driving motor sections 2 & 8 of the LTA).
the Land Transport Act 1998 [the LTA]). A bicycle vehicles, some other charges, such as careless
Who’s Who at Webb Farry...
Partners: David J. Ehlers, LL.B, B.Com Legal Executives: Suzanne A. Corson NZLEC Offices at: 79 Stuart Street,
James H. Lovelock, LL.B, B.Mgmnt John Summers NZLEC Dunedin 9016, New Zealand.
John A. Farrow, LL.B, B.A Jenette A. Ramsay Telephone: (03) 477-1078
Megan L. Bartlett, LL.B, B.A Fax (03) 477-5754
HR & Operations
Associates: Melanie H. Hayes, LL.B, B.A 107 Gordon Road, Mosgiel, 9024
Manager: Tracy J. Stevenson
Larna Jensen-McCloy, LL.B New Zealand.
Brenda Thom, LL.B, B.Com Telephone: (03) 489-5157
Administration
Chris P. Thomsen, LL.B, B.A Fax (03) 489-2021
Manager: Margot E.M. Koele
Warren J. Moffat, LL.B, B.A
All Correspondence to:
Aaron D. Crampton, LL.B, B.A
Systems & Accounts DX YX10151 or
Senior Manager: Tania J. Graham P.O. Box 5541,
Solicitors: Dominic I.W. Fitchett, LL.B, B.A
Dunedin 9058, New Zealand
Shelley M. Chadwick, LL.B, BA
Email: lawyers@webbfarry.co.nz
Solicitors: Sarah A. McClean, LL.B(Hons), B.A(Hons)
Shayne P. Milne LL.B Website: www.webbfarry.co.nz
All information in this newsletter is, to the best of the authors’ knowledge, true and accurate. No liability is assumed by the authors, or publishers, for any losses suffered by any
person relying directly or indirectly upon this newsletter. It is recommended that clients should consult a senior representative of the firm before acting upon this information.
AS
A L T E R N A T I V E S P A C E G A L L E R Y
asgallerydunedin.tumblr.com
MIRANDA JOSEPH 05.05.15 - 31.07.15
POOL
Miranda Joseph, originally from Wellington, has lived in Dunedin since 2010 and graduated from the BVA Honours
programme at the Dunedin School of Art in 2014. Her work in painting and drawing predominantly utilises photograph-
ic imagery to explore Dunedin’s land and cityscape. Joseph is currently studying towards her Masters degree in Fine
arts at the Dunedin School of Art.
The Pool series of paintings exhibited in the Webb Farry AS gallery was inspired by photographic images taken in and
around the Moana pool complex in Dunedin. The public swimming pool presents a space rich in oppositional catego-
ries (inside/outside, reflected/real, fluid/solid) which has provided the structure to support an exploration of formal, or
picture making concerns in this work.
Painted in acrylics on canvas or paper supports, the layered and reflective nature of the composition of these paint-
ings is expressed in the materiality of the paint. The image is built up in multiple acrylic washes creating a transparent
quality. Masking fluid and blotting techniques allow in places underlying layers to emerge. Reflections confuse the
juncture where inside meets outside and an ‘other” space is suggested by the ambiguity created between figure and
ground, something and nothingness.
Pool 1 (2014) acrylic on canvas 2 x 100cm x 130cm
7 9 S T U A R T S T R E E T D U N E D I N
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