Newsletter - Mid Year Edition July'04
GST -GOING CONCERN EXEMPTION
GST is exempted where a business is sold as a 'going concern'. This exemption usually affects a business that will continue to operate in a similar manner to that before its sale. It also requires the parties to be registered for GST.
The parties must confirm in the contract that the sale is of a 'going concern'. The vendor must provide the necessities for the continuing operation. This can mean that key staff must remain. The lease must be transferred. The style of running the business must remain unchanged.
The exemption applies even if the sold business enterprise is part of a larger business. For example, the vendor might own many shops but sells one to the purchaser. If the single shop can be operated independently then the sale will be GST free.
E-MAIL POLICY PRECAUTIONS
A recent Court case has stated that employees using their employer's computer system cannot
deny the employer access to any information which the employee stores on the system.
Equally, employers are liable for 'private communications' which employees send by e-mail. This can apply even if that e-mail has nothing to do with their employment.
Employers must clearly state the limits of the permitted use for company e-mail and internet systems to avoid potential liability. Employees who breach that policy can have their employment terminated as they are unlikely to succeed in a claim for wrongful dismissal.
DRUG DRIVING
An estimated 20% of road traffic fatalities have a blood alcohol level above the legal limit. 15% of fatalities test positive to cannabis or other drugs including amphetamines and analgesics.
A policeman who believes that a driver is drug impaired can require that driver to undergo assessment. Penalties may include licence cancellation for at least 12 months for a first offence.
Second or subsequent offences can include penalties of a minimum 2 years of licence cancellation.
MEDICAL MALPRACTICE
There is a perception that a poor outcome to a medical procedure leads to a possible medical malpractice suit. This is incorrect. It is necessary to prove negligence before a case can be won.
The cases which succeed are those where there is evidence of a failure by the doctor to take proper care or to provide proper information. In those situations when the medical procedure goes wrong then the basis of a claim is established.
Generally the patient will have to give the doctor a second opportunity to correct the perceived problem before embarking on a claim for damages.
RETAIL LEASES
Tenants have an obligation when they are selling their business to inform their purchaser of the terms of the lease. This is initially done by way of a Disclosure Statement which document is similar to that which the tenant would have received when negotiating the lease with the landlord. The document must show any changes between the parties that have occurred since the original lease was drafted.
It is not widely understood by vendors that the landlord must provide a new Disclosure Statement. This is done at the expense of the vendor-tenant. The landlord is entitled to investigate the bona fides of the purchaser and can ask the vendor-tenant to pay costs for that investigation. The vendor-tenant is also responsible for the landlord's costs of checking any documentation that is required to transfer the lease to the new tenant.
POTENTIAL BANKRUPTCY CHANGES
It is common for people in business to transfer personal assets to their spouse. If the business fails then creditors can only force the sale of assets which belong to the business person - not those belonging to the spouse. The transfer protects those personal assets.
Changes are now being mooted whereby the Trustee in Bankruptcy will be able to recover assets held in the name of the spouse where the bankrupt has paid for and uses the asset. If this legislation goes through then it will be very difficult to shield personal assets from creditors.
FAMILY LAW
There has been a major re-write of Family Law legislation. The Court can now refuse to issue documents provided after an agreed or ordered date. The lodgement will require the further approval of a Judge or a Registrar of the Court. This can mean that potential cases will be lost as the Court will not allow the hearing of issues which are raised in documents which the Court has not allowed to be filed.
Every litigant is therefore going to have to work hard to keep their case moving and ensure that all documents are lodged within the time constraints set by the Court.
STALKING
It is usually believed that stalking involves the physical presence of the stalker near the person being stalked. New legislation has expanded the stalking provision to cover electronic communication such as emails, impersonating a person in a chat room, tampering with another person's computer and publishing offensive material on the internet.
The law will apply even if the victim is not aware of the stalking. It is only necessary to establish that the behaviour is occurring.
AFTER HOURS EMPLOYEE CONDUCT
There have been a number of cases where the Courts have held that an employer can discipline or even dismiss an employee for after hours conduct that is directly linked to employment. That conduct must have a serious and significant effect on the workplace. It must also damage the employer's interest.
An example of this type of situation is when one employee assaults another employee in an environment which is not work related, eg. in a bar outside work hours. Each case will, of course, be determined on its merits.
ACCREDITED SPECIALISTS
All Lawyers who are Accredited Specialists (as I am) must do a minimum of 10 hours of seminars, course work or the equivalent of same each year in their field of specialisation. An audit is done by the Law Institute to check that the course work is completed.
All Lawyers, in particular those who are not Accredited Specialists, are now required to do 10 hours per annum of course work and seminars in legal topics and practical issues that affect their Practices. This can include Legal Ethics, Trust Account managements and Equal Opportunity.
I would like all readers of this Newsletter to note that while I believe the content to be accurate and correct, this does not mean that, on its own, it can be relied upon as legal advice. If you have a problem which involves any of the issues contained in this newsletter then please contact me to discuss that problem.