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249 days ago

Your Consumer Rights

Corcoran French

We are often asked to advise on disputes over consumer goods such as costly electronic items, household furniture and sports equipment. Helpfully we usually can say that our clients have more rights than they are lead to believe by the retailers they're dealing with.

The Consumer Guarantees … View more
We are often asked to advise on disputes over consumer goods such as costly electronic items, household furniture and sports equipment. Helpfully we usually can say that our clients have more rights than they are lead to believe by the retailers they're dealing with.

The Consumer Guarantees Act for example provides rights and guarantees for you as a consumer when purchasing goods or services for your personal and household use. It applies to any retail sale of goods or services, but not private sales.

That Act gives a number of guarantees about the ownership, delivery and purpose of a product, but it’s more commonly used as protection and a sword when goods aren’t of an acceptable quality or they are not fit for their intended purpose.

Generally, goods are of an acceptable quality where they are fit for the purpose for which they are typically supplied for, free from defects and are safe and durable. This test is assessed on the basis of what a reasonable consumer, being aware of the state and condition of the goods, would consider as acceptable. Things like their nature, price and any statements that are made about them on labelling are all taken into account.

If what you’ve bought doesn’t meet the above requirements, you can insist that the retailer fix the fault. If they don’t, you can then have it remedied elsewhere or reject the goods and get your money back.

Where the fault can’t be remedied or it's substantial, you can however reject the goods straight away.

To give an example, should you purchase a TV that is advertised as having 3 HDMI cable ports but only 2 ports work, or the retailer tells you it has a Netflix remote button and it doesn’t work, you can return the TV to the retailer within a reasonable time of the purchase. The retailer has to fix it at their cost or give you your money back.

If you would like further information on your rights as consumer, please do not hesitate to contact us to discuss.

Call or email Richard Hearn for more information.
Ph 3794660 or richard@corcoranfrench.co.nz

318 days ago

Buying a cross lease property

Steven Duxfield from Corcoran French

Quite different from a fee simple title

New Zealanders love to talk about property. There are a multitude of topics relating to property that Kiwis have an intimate knowledge and understanding about which form the topic of water cooler and dinner conversation. The cross lease is just one of those … View more
Quite different from a fee simple title

New Zealanders love to talk about property. There are a multitude of topics relating to property that Kiwis have an intimate knowledge and understanding about which form the topic of water cooler and dinner conversation. The cross lease is just one of those many topics of conversation.

Traditional land ownership model

When you’re considering buying a house, you don’t envisage a cross lease form of ownership. You think of owning your own slice of land, subject only to the laws of New Zealand, and what your title says you can and can’t do. This form of ownership is called a fee simple title.

A cross lease is not the same as a fee simple title.

What are the differences?

When you purchase a cross lease property, you buy a joint share of the underlying land together with the other cross lease holders and you lease from the other cross lease holders the rights to the house/flat/building you will occupy. The terms of this arrangement are governed by a lease registered against the title to the land.

The main difference from a fee simple title is that you are not the sole owner of your land or your home. You own the property jointly with others.

Your rights, obligations and powers in relation to the property are subject to those other interests, and vary from situation to situation. Generally, you will need the consent of your fellow cross lease holders to carry out any structural renovations or any major maintenance or other works to the property you lease. More minor restrictions can extend to the number of pets you are able to keep.

There are general leasing principles to adhere to, such as ensuring that you don’t create a nuisance and allowing the other cross lease holders to quietly enjoy their tenancy. A commonly neglected and overlooked provision is the requirement in most cross lease documents to have a joint insurance policy with the other cross lease holders.

How can you address your obligations?

There is nothing that can’t be done without agreement and, of course, the cost of doing so.

Initially, we recommend talking with us to discuss the issues associated with owning a cross lease property. This should happen before you buy, not afterwards. We will give you an overview of cross leasing and discuss the potential issues you will need to deal with if you purchase the cross lease of that particular property. We will also review the cross lease document and advise you of its terms. It is imperative that you understand the nature of this form of property ownership before you are committed to purchase a property on a cross lease title.

There are other potential issues (which sit outside the scope of this broad-natured article) which we will need to check at this stage as well, such as the aerial plan for the cross leases to ensure that is accurate and doesn’t result in a defective title.

It is better to have an understanding of the issues before you commit to purchase rather than attempting to remedy them after you take ownership.

Most matters relating to cross leasing can be dealt with by agreement between you and the other cross lease holders and their lawyers. However, the cost of attempting to remedy any issues may well be prohibitive for most people and getting other people to agree to what you want and need is never something that should be relied upon.

Although there are significant differences from a fee simple title and sometimes difficulties with purchasing a cross lease property, many thousands of properties in New Zealand operate under this structure with no problems whatsoever. It is important though to understand how cross leasing works and how it differs from what many consider to be the traditional land ownership model.

If you are considering buying a cross lease, the most important thing is to be well-informed and enter into owning one with your eyes wide open.

A cross lease can often be converted to a fee simple title with consent of the other parties involved and their lawyers, and a surveyor. It can be a relatively straightforward process, however costs can vary significantly depending on the characteristics of your particular situation.

If you’re considering buying a property on a cross lease, talk with us early on. It will be time well spent.

502 days ago

Anti Money Laundering

Steven Duxfield from Corcoran French

From 1 July 2018, the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (which is quite a mouthful, but “AML” for short) starts applying to all New Zealand law firms – and their clients. We introduced AML in our April newsletter. The law is not new as it’s been applied … View moreFrom 1 July 2018, the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (which is quite a mouthful, but “AML” for short) starts applying to all New Zealand law firms – and their clients. We introduced AML in our April newsletter. The law is not new as it’s been applied to banks and finance companies since 2013. But it’s new for lawyers.
Why?
Globally, good governments want to make it harder for criminals to launder money, and are attempting to restrict the flow of money to terrorist organisations. AML does this.
But “that’s got nothing to do with me”, you say?
Almost certainly true. But there are some in our communities who engage in those activities and, like every other piece of law, in order to catch the bad guys the good guys have to put up with some increased scrutiny.
Why lawyers?
Lawyers are seen as a target for money laundering. That’s because we transfer properties for you and handle large amounts of your funds. A criminal could, say, try and put some dirty money into our trust account to buy a house, then a year later sell it, collecting the cash, which would then be cleaned or laundered and so not linked back to their original illegal activity.
We’re not the only ones. Through 2018 and 2019, we’ll be joined by accountants, real estate agents, sports betting agencies (TAB) and dealers in certain high value items (vehicles, antiques, jewellery, etc). AML is very far reaching.
So, what does it all mean for me?
The law says that we have to know all of our clients. That’s easy, you say. You’ve been with us for a while – of course we know you! Not so. In many ways yes, but AML tells us that we must have proof of your identity when we take instructions from 1 July 2018, such as copies of your ID and documents verifying your address. If you have a company or trust, we will need more information still. If you’ve had to open a bank account in the past few years, you’ll know what it’s like having to provide documentation. The same rules will very shortly apply to us.
So, the next time you come in to see us, or contact us to act for you, our lawyers will need to sight your ID and proof of address. It’s called CDD – Customer Due Diligence, so if we tell you that we need to conduct CDD, that’s what we’re talking about.
We’ll likely ask for that required information the next time we see you (closer to, and from, 1 July), even if we might already hold some of it. If you have difficulty producing some of what we ask for, please talk to us. If, for example, you don’t have a passport or photo ID driver’s licence, there may be other ways we can meet our AML obligations.
We’ll make it all just as easy for you as we can, but we do need your co-operation. If we’re unable to complete our required CDD, we are by law unable to continue to work with you, and we wouldn’t want that.
For more information on all this exciting AML stuff feel free to contact your usual Corcoran French lawyer, or our AML Compliance Officer AMLCompliance@corcoranfrench.co.nz

544 days ago

Economic disparity at the end of a relationship

Steven Duxfield from Corcoran French

How might this impact you?
As much as we like to think we are living in the modern day, there are still a large number of relationships that follow the more ‘traditional’ practice of having one party act as the ‘homemaker’, while the other acts as the ‘breadwinner’. If the relationship … View more
How might this impact you?
As much as we like to think we are living in the modern day, there are still a large number of relationships that follow the more ‘traditional’ practice of having one party act as the ‘homemaker’, while the other acts as the ‘breadwinner’. If the relationship breaks up, economic disparity is likely to be an issue.
With the divorce rate in New Zealand sitting at around 50%, chances are you have friends and family members who have structured their relationship in this more traditional sense and have now separated. The result is often that the ‘homemaker’ is left in a worse position financially because they have been out of the workforce for a long time and will struggle to get back into their career. The breadwinner, meanwhile, who could focus on their career during the relationship, is now earning at their full potential. This is economic disparity – one party is advantaged over the other.
One of the principles of the Property (Relationships) Act 1976 (PRA) is that a de facto relationship, civil union or marriage is a partnership of equals and that financial and non-financial contributions to that relationship are equal; the homemaker’s contributions are equal to the breadwinner’s. There is also a presumption of equal sharing of relationship property; but what about the earning potential of one party over the other? If that earning potential has increased during the relationship, should that be considered an asset of the relationship or relationship property?
Can we ‘fix’ disparity?
Section 15 of the PRA allows for one party to be compensated if the income and living standards of the other party are likely to be significantly higher due to the ‘division of functions’ within the relationship – the role of breadwinner and homemaker.
Parliament acknowledged that an equal division of relationship property doesn’t always achieve fairness if one party is able to walk away with not only half the assets, but also a considerable income-earning ability, while the other has foregone theirs and supported the breadwinner in the process. While statistically the party left worse off after separation is almost always female, as the Prime Minister, Jacinda Ardern and her partner, Clarke Gayford have recently shown us, women can be breadwinners too and economic disparity can affect men.
Same-sex couples can also be vulnerable to economic disparity, which can arise in any relationship where one party has been able to progress their career while the other looks after the home.
The Law Commission recently reported that s15 has had limited success in achieving its objective. It found that sharing property equally doesn’t always result in an equal outcome. Following a separation, on average, mothers who are caring for children have their household income reduced by 19% while men in employment increase their household income by 16%. Economic disparity and how to address the issues arising from the more ‘traditional’ relationship roles is a significant focus of the Law Commission in its current review of the PRA.
Recent boost to claims
Economic disparity claims have been given a boost by the recent Supreme Court decision of Scott v Williams. This case involved a couple who structured their relationship in the ‘traditional sense’. Ms Scott, who had accounting and law degrees, put her career on hold to look after the couple’s children while Mr Williams built up a successful legal practice. When they separated after more than 25 years of marriage their incomes were vastly different.
The court ultimately found (after eight years of court battles) that in a long-term relationship, where there is the traditional split of roles between homemaker and breadwinner, and a significant disparity in income, an economic disparity claim can be presumed and compensation should be paid. The amount of compensation is determined on a case-by-case basis. There is no set method for determining the compensation, which does make it difficult for parties to agree.
Since s15 made its way into law in 2001, there have been about 100 cases go through the courts on this point, with only around 40% having been successful. Economic disparity remains a difficult, complicated and emotional topic for separating couples to discuss and on which to agree.
If you have separated and believe economic disparity is an issue, please talk with us to discuss whether this is a claim that may affect you, and how you either negotiate or defend such a claim. A contracting out agreement (colloquially known as a ‘pre-nup’) may assist, if prepared properly from the outset. If you wish to achieve some level of certainty, it would pay to contact us.

566 days ago

WHAT CAN A ROMALPA CLAUSE DO FOR YOU?

Steven Duxfield from Corcoran French

If you are in business, you will experience at some stage the consequences of not being paid by your customers. Bad debt costs New Zealand businesses billions of dollars each year and causes many businesses to fail. Don’t become a statistic – protect your business.
For any business, best … View more
If you are in business, you will experience at some stage the consequences of not being paid by your customers. Bad debt costs New Zealand businesses billions of dollars each year and causes many businesses to fail. Don’t become a statistic – protect your business.
For any business, best practice is to have well-drafted Terms of Trade in place which are tailored to your specific business activities. Your Terms of Trade need to form part of your contract with your customer, so either have your customer sign them, click a button on your website to confirm they agree to them, or send a copy to your customer before you supply goods or services.
Where your business supplies goods, your Terms of Trade (and any other supply agreements) should include a Romalpa clause, which is also known as a “reservation of title” clause. It provides that until full payment is received from the buyer, ownership of the goods sold remains with the seller, although the buyer is allowed to take delivery of the goods. Risk of loss and damage in the goods passes to the buyer upon delivery, but if the buyer does not pay, the seller can repossess the goods.
There may be practical difficulties in repossessing the goods (say, if the costs of doing so are very high). As a seller, you may also wish to also provide that you are entitled to the proceeds if the buyer sells the goods to a third party or manufactures new goods out of the goods supplied.
If you are a buyer, under the Consumer Guarantees Act 1993, you are entitled to be told about the possibility of the goods being taken off you if you do not pay for them by a certain date and you must have been given a copy of the Terms of Trade (or other document) telling you that the seller has these rights.
A Romalpa clause means that the seller takes a “security interest” in all goods supplied. However, a seller with such an interest may lose priority to another creditor and walk away with nothing if it does not register the interest on the Personal Property Securities Register (“PPSR”).
Registration on the PPSR:
· improves the seller’s chance of recovering the debt owed if the buyer defaults; and
· gives the seller priority over creditors with an unperfected security interest in the same goods or a security interest perfected later in time.
A Romalpa clause may qualify as a “purchase money security interest” (“PMSI”). If a PMSI exists it will give the seller additional priority over security interests already registered in the same goods but only if registration takes place within certain periods of time (for example, a security interest for inventory must be registered by the time the buyer takes possession of the goods).
In summary, it is important for a seller to:
· Have Terms of Trade in place, which the buyer has agreed to.
· Include a Romalpa clause in the Terms of Trade and draw this clause to the buyer’s attention.
· Register a security interest on the PPSR (at least for significant sales) to give the seller a better chance of recovering the debt if the buyer defaults.
· Register within the specified time periods.
Our commercial team at Corcoran French is experienced in ensuring that our clients take appropriate steps to protect their business from bad debts. If you would like to know more about our services, then we are available to assist.

642 days ago

Commercial Leasing

Steven Duxfield from Corcoran French

Commercial Leasing
The terms of a commercial lease are vastly different to that of a standard residential tenancy agreement. It would be impossible for us to outline all the terms of a typical commercial lease in this article but we outline a few of the common issues and queries which commonly … View more
Commercial Leasing
The terms of a commercial lease are vastly different to that of a standard residential tenancy agreement. It would be impossible for us to outline all the terms of a typical commercial lease in this article but we outline a few of the common issues and queries which commonly arise between both Tenant and Landlord.
Agreement to Lease

An Agreement to Lease is the initial document signed between the parties setting out the main terms of agreement between them. It is not the formal lease document. The Agreement to Lease usually requires a formal deed of lease be entered into setting out all of the terms, rights and obligations of the parties and enforcement provisions. Many clients mistakenly believe that once they have signed the Agreement to Lease, this is the formal contract. The Agreement to Lease does not contain all of the necessary provisions required to protect both parties which are contained in the full deed.

Costs

Recent revisions of the Auckland District Law Society (ADLS) commercial lease removed the ability for a Landlord to charge the Tenant for the Landlord’s legal costs for preparation of the lease documents. Each party now bears their own costs for the preparation, variation or deed recording a rent review or renewal unlike the earlier versions which made this a Tenant responsibility. The Tenant is still required to meet the Landlord’s reasonable costs in considering any request by the Tenant for the Landlord’s consent as well as the enforcement of the Landlord’s rights, remedies and powers.

Maintenance Obligations

Generally speaking a Tenant is responsible for maintaining the interior of the premises and is required to yield up the premises in a like condition as at the start of the lease. The Landlord is usually responsible for maintaining the exterior of the building and ensuring that it is weathertight. Often having a premises condition report attached to a lease when signed will avoid any possible disputes at the end of the lease. This report is very useful in situations where a Landlord has sold the premises, or the Tenant has sold the business and assigned the lease to a new Tenant.

Renewal of Lease

Often we see both the Landlord and Tenant fail to deal with subsequent renewals of the lease according to the lease terms. The standard provisions of the ADLS lease provides that where the Tenant intends to exercise its right of renewal (if one is provided) it must provide written notice to the Landlord of its intention to exercise its renewal no later than three months prior to the expiry of the current term. If a Tenant fails to provide that notice, the Landlord can terminate the lease on the final expiry date. However, if neither party take any steps the lease will revert to a month to month lease until either party terminates with one month’s notice.

Dealing with renewals correctly is important from both parties’ perspective. For the Landlord it ensures that a Tenant is locked in for a specified period of time and provides it certainty of future rental income.

From a Tenant’s perspective it provides security of site which is especially important where the location of the premises is a fundamental part of its goodwill. If a Tenant fails to properly execute or exercise its rights of renewal the value of its business could be drastically reduced.

Commercial leases can be complicated and both Landlord and Tenant are considered equal commercial parties. It is therefore important that both parties understand their obligations.

If you would like some specific advice in relation to your lease or a particular situation we suggest that you contact us and we can provide you with some further advice in this regard.

Michael is an Associate in our Property Team based in our Kaiapoi Office and can be reached on (03) 327 8159 or by email michael@corcoranfrench.co.nz

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692 days ago

The Jacinda Question - can employers ask job applicants about their baby plans?

Steven Duxfield from Corcoran French

After weeks of guessing and a hard fought election, Jacinda Ardern, Labour’s youngest ever leader is now Prime Minister of New Zealand. She heads a Labour led government with a New Zealand First and Green party coalition.
She made international news during the election campaign for refusing to be… View more
After weeks of guessing and a hard fought election, Jacinda Ardern, Labour’s youngest ever leader is now Prime Minister of New Zealand. She heads a Labour led government with a New Zealand First and Green party coalition.
She made international news during the election campaign for refusing to be drawn on whether she planned to have children and for criticising the AM Show’s Mark Richardson, when he suggested that all employers have a right to know this when hiring a woman.
It raised an important question for employers. Is it ever ok to ask a female candidate about her baby plans?
The answer here in New Zealand is clear. Discrimination on the grounds of pregnancy, childbirth and family status is prohibited. A range of legislative protections to this effect are enshrined in the Human Rights Act 1993, the Employment Relations Act 2000 and the Parental Leave and Employment Protection Act 1987.
As pregnancy can raise the possibility of altered working conditions and parental leave, some employers may like to know of a woman’s plans, but asking about that raises significant risk. Women must be treated the same as any other candidate in the recruitment process. Pregnancy, or potential pregnancy, should not be taken into account when deciding who to hire. There is generally no lawful reason for an employer to ask such questions of a candidate therefore.
This most likely also applies where the position is for a fixed term or where an employer has health and safety concerns given the pregnancy.
Simply assuming that a pregnant woman may not work for the full period of a fixed term of employment is likely to fall foul of our employment laws. A court would likely say that it cannot be anticipated how much parental leave she may wish to take, or even be entitled to.
From a health and safety perspective, it would be rare that work which is safe for other employees would pose a risk due to pregnancy. Even where this is so (for example say where the work involves heavy lifting or exposure to chemicals) there are usually alternatives open to employers. They include temporarily changing an employee’s duties or directing her to take early parental leave. The New Zealand courts are likely to prefer such alternative arrangements being implemented, over say a scenario where a woman is denied access to employment in the first place.
Men are also protected from discrimination on grounds of family status and are able to share parental leave with the mother. In fact, any person who is the primary carer of a child can now apply for leave from employment where certain conditions are met given changes to parental leave legislation in 2016.
This all means baby plans should not be a topic for discussion at interviews in job situations, no matter who is applying for the job.
We also add that the law surrounding parental leave was recently changed, as noted above, and can be tricky to navigate. Our employment team can help you make sure that the right procedures are being followed.
If you want to know more please contact Geraldine Biggs, Associate, in our Litigation Team, Ph 03 379 4660 or via the email link below.

726 days ago

We are moving

Steven Duxfield from Corcoran French

We are moving our city office soon, but not far. You’ll still be able to find us easily. We’re just moving to the other side of the car park into freshly fitted out space, above Lighting Plus. Our address remains the same - 166 Moorhouse Ave and we will still have the same great car … View moreWe are moving our city office soon, but not far. You’ll still be able to find us easily. We’re just moving to the other side of the car park into freshly fitted out space, above Lighting Plus. Our address remains the same - 166 Moorhouse Ave and we will still have the same great car parking available right outside our doors. Our telephone number, email addresses and postal address remain unchanged. We expect our move to take place over the weekend of 3-5 November.
Our Kaiapoi office location remains unchanged.

754 days ago

How to Recover Undisputed Debts

Steven Duxfield from Corcoran French

When the court makes a decision that an individual or business is owed a debt, it issues a judgment order telling the debtor that they must pay the creditor. However, often creditors are left wondering what happens if the debtor doesn’t pay. Find out how the court can assist you in recovering an … View moreWhen the court makes a decision that an individual or business is owed a debt, it issues a judgment order telling the debtor that they must pay the creditor. However, often creditors are left wondering what happens if the debtor doesn’t pay. Find out how the court can assist you in recovering an undisputed civil debt.
Collecting civil debt
The process of collecting civil debt if the debtor doesn’t pay is called ‘civil enforcement’. A creditor can only initiate civil enforcement where a court or tribunal has ordered a debtor to pay a civil debt. The court doesn’t enforce judgment orders automatically; a creditor must select the appropriate enforcement actions and manage the process independently, or with the assistance of a lawyer. When you make an enforcement application, you can claim interest on civil debt that’s more than $3,000. If your order is more than six years old, you may need the court’s approval before taking enforcement action.
You must know a debtor’s correct address before the court can take some enforcement actions on your behalf. If you don’t have the debtor’s address, you can:
· Try to find the address yourself
· Make a confidential address information request with the Ministry of Justice, or
· Enquire with a government agency under the Official Information Act 1982.
Enforcement process
There are a number of ways that the court can help you to enforce a civil debt. These include:
· Assess the debtor’s finances on paper: a financial statement for the debtor can be completed by the debtor or by you, if you have sufficient information about the debtor. This can be useful if the debtor doesn’t have a phone, English is not their first language or they cannot attend a hearing
· Assess the debtor’s finances over the phone: if you have the debtor’s telephone number, you can apply for a registrar to telephone the debtor to ascertain their ability to pay. This can be useful if you don’t have the debtor’s address, you don’t want to attend a hearing or the debtor has not completed a financial statement, or
· Summon the debtor to a financial assessment hearing: if you have an address for the debtor, you can apply for a hearing to ascertain the debtor’s financial situation. You can serve a summons to the hearing on the debtor, or request a court-appointed bailiff to do so. If service is unable to be completed, you must provide a new address for the debtor. Where service is completed, but the debtor fails to attend the hearing, a warrant for the debtor’s arrest may be issued.
Enforcement actions
You can make multiple applications to enforce civil debt:
· If you know who pays the debtor (salary, wages or benefit), you can apply for an attachment order, which tells an employer or Work and Income to transfer money from the debtor’s wages or benefit to you. This arrangement can be set up either at a hearing if the parties agree, or after the judgment order has been made
· For a debtor who has valuable assets, you can apply to the court for a warrant to seize property. You must provide evidence that the debtor owns the property
· If someone else owes the debtor money, you can apply to the court for garnishee proceedings to have that money paid to you instead, and/or
· For a debtor that owns property, you can apply for a charging order to make it difficult for them to sell that property until the debt is paid.
Fees
There are fees associated with civil enforcement. You can, however, add the cost of fees to the amount owed by the debtor to be recovered when the debt is paid. A list of current fees can be found here.
Forms
You must complete an application form for each debtor. A list of civil enforcement forms can be found here.
The process of enforcing civil debt can be time-consuming, and a debtor can throw up many roadblocks to prevent you from getting your money. If you’re having problems recovering a debt, we’re happy to guide you.

775 days ago

Up in the Air: Using your drone

Steven Duxfield from Corcoran French

The use of drones is no longer limited to government agencies, technical gurus or the super wealthy. The market has been flooded with drones that are reasonably priced and are easy to use. These high-tech pieces of equipment are, however, bound by Civil Aviation Rules. In this article, we explore … View moreThe use of drones is no longer limited to government agencies, technical gurus or the super wealthy. The market has been flooded with drones that are reasonably priced and are easy to use. These high-tech pieces of equipment are, however, bound by Civil Aviation Rules. In this article, we explore what rules there are around their use.

Drone technology allows a pilot to film and photograph from the sky allowing an aerial view that was once only available through the use of planes, helicopters or satellites. More and more businesses are using drone technology to assist them. Drones have been used in the agricultural sector to aid crop and stock inspection and, in August last year, Domino’s Pizza successfully delivered a pizza by drone.

CAA Rules
Following the increase in availability for personal use, the Civil Aviation Authority (CAA) has issued rules regarding the piloting of drones in an attempt to ensure procedures are followed to minimise any risk to the public.

Civil Aviation Rules (Part 101) have provisions that must be adhered to when piloting a drone that is under 25 kgs. Any drone weighing more than 25 kgs requires a certification from the CAA. Most commercial drones, however, weigh less than 25 kg.

Where can you fly a drone?
A pilot may only fly a drone during the day, no higher than 120 metres (400 feet) and must always ensure the drone is within their line of sight without the aid of any visual tools such as a virtual reality headset. The drone pilot must gain the consent of any person over whom the drone flies. Likewise, the pilot must gain the consent of the owner of any private land over which the drone flies.

The New Zealand Transport Agency doesn’t allow drones to fly over any of the 11,000 km of state highways due to their potential to distract drivers and cause accidents.

Public property such as parks are often the best place to fly drones. However, each of the country’s local authorities has the discretion to set its own policies and bylaws in relation to the use of drones over council-owned land. Some councils adopt a blanket consent approach to the use of drones over their property. This, however, may be subject to more specific rules issued by the particular council. Pilots should be fully aware of any rules or regulations that they would be subject to flying in a particular area.

It should be noted that the rules for drones also apply to pilots of remotely controlled model planes.

Privacy issues
Drones fitted with recording devices do cause concern on issues surrounding privacy. Any complaints surrounding the intrusion of drones over private property without consent, or a breach of the Civil Aviation Rules, should be addressed to the Privacy Commissioner or the CAA.

Shooting down any drone that’s hovering over your property would constitute any number of offences under the Summary Offences Act 1981, the Crimes Act 1961 and the Arms Act 1983.

Penalties
There have been multiple instances of the CAA issuing fines ranging between $500 and $1,000 for not complying with Part 101 of the Rules. The CAA has even successfully prosecuted a man in the District Court. He was found guilty of causing unnecessary endangerment and flying in a controlled airspace without permission when the pilot filmed a rural fire from his drone within close proximity to a helicopter.

Pilots are also at risk of prosecution under the Privacy Act 1993 and the Crimes Act 1961 for using their drones to record information in a way that is illegal. Pilots may also face a private prosecution by the victim for an invasion of their privacy.

Drones can be an excellent way to help your business, as well as being a great deal of fun. Before becoming airborne, however, make sure you know the rules and you are mindful of privacy issues.

You can find more information on operating drones at www.airshare.co.nz... or www.caa.govt.nz...

796 days ago

Landlord Update

Steven Duxfield from Corcoran French

Landlord Update: A Summary of Proposed Changes to the Residential Tenancies Act 1986
Tenant Liability for Damage
Following the implications of Holler v Osaki [2016] NZCA 130, tenants seemingly cannot be held liable where the residential property they are tenanting suffers loss or damage caused … View more
Landlord Update: A Summary of Proposed Changes to the Residential Tenancies Act 1986
Tenant Liability for Damage
Following the implications of Holler v Osaki [2016] NZCA 130, tenants seemingly cannot be held liable where the residential property they are tenanting suffers loss or damage caused intentionally or carelessly by the tenant or their guests. Practically speaking, most landlords hold comprehensive house insurance, whether to comply with the obligations of their mortgage or simply to lower the risk that comes with their investment. Consequently, a landlord’s loss is generally confined to their insurance excess or any amount not worth claiming under their insurance.
The government has proposed a number of changes to the Residential Tenancies Act 1986 (“Act”). These changes, generally speaking, create three types of responsibility:
1. The General Rule: The general rule is that a tenant has no obligation to meet the cost of making good any destruction of, or damage to, the premises. This also means the tenant does not have to pay damages, indemnify the landlord or carry out any works.
2. Intentional Damage or Crime: A tenant is liable for destruction or damage that is:
a. intentionally done or caused by the tenant;
b. the result of an act or omission by the tenant which is also an imprisonable offence; or
c. an act or omission by the tenant that has resulted in damage or destruction to the property which has also rendered any insurance moneys that would otherwise have been payable, irrecoverable;
3. Damage Caused by a Careless Act or Omission: The tenant’s liability for damage or destruction that is caused by a careless act or omission of the tenant (and is not the sort of damage or destruction contemplated in (2) above) is effectively limited to four weeks’ rent.
For reference, damage or destruction caused by the tenant also includes a person for whose actions the tenant is responsible under section 41 or 66L of the Act.
Another important point for landlords to consider is that as currently drafted the amendments make it an unlawful act for a landlord to request or accept from their tenant a payment or for the landlord to require the tenant to carry out remedial work where doing so would exceed the tenant’s liability under the Act. A landlord also cannot enter into an agreement under which the tenant is obligated to do the same. This means that in future landlords and tenants will be restricted in their ability to reach an agreement in good faith to remedy any damage to the property.
The amendments also seem to limit an insurer’s right of subrogation to pursue a tenant directly for destruction or damage that is the result of a careless act or omission (as contemplated in (3) above).
Methamphetamine
Residential property owners are increasingly finding that methamphetamine contamination is an issue. This trend may worsen following reports in the media that methamphetamine is becoming more prevalent. Most landlords will be aware that recently Standards New Zealand released NZS 8510:2017 Testing and decontamination of methamphetamine-contaminated properties. These standards provide much needed guidance to the industry. This standard is also freely available on the Standards New Zealand website. However, the proposed amendments to the Residential Tenancies Act 1986 make no reference to this standard, instead providing the government with the power to prescribe regulations that set what is acceptable contamination and what is not. Property experts agree that contamination is unacceptable but what is acceptable contamination is the most contentious part of the debate and as such should be decided as a part of the legislative process. It is possible that lawmakers will adopt the accepted levels of contamination contemplated in NZS 8510:2017 or that the suggested levels in NZS 8510:2017 are prescribed in the regulations to come.
The changes to the Act as drafted would enable landlords to test for methamphetamine after giving 48 hours’ notice to their tenants, as the current right of inspection at 48 hours’ notice would not permit methamphetamine testing to occur. Should contamination be established, a landlord may give seven days' notice to terminate the tenancy and a tenant is only required to give two days' notice to terminate the tenancy. However, a landlord should still be testing at the beginning of a tenancy to establish a baseline so a tenant’s blameworthiness can be established. Proposed changes to the Act also make it unlawful for a landlord to commence a tenancy at a property knowing that it is contaminated. However, until the Act is passed and regulations are prescribed, what amounts to contamination under the Act is unclear.
As a general rule, we recommend that a purchaser should be conducting a meth test prior to purchasing a property. As an added precaution, a condition should be included in any purchase contract (in addition to a building report clause) making it clear that meth testing is required as part of the due diligence process. This makes it clear at the outset of the purchase process that a purchaser intends to conduct a meth test at the property and avoids any potential issues with cancelling the purchase contract should the results of the meth test not be satisfactory.

824 days ago

Collecting a Commercial Debt

Steven Duxfield from Corcoran French

Getting that Money You’re Owed
It can sometimes be frustrating and time consuming to pursue debts owed. Multiple requests for payments are often met with continual promises to pay from debtors, however no money may be received or payment is slow. We therefore explain some effective recovery … View more
Getting that Money You’re Owed
It can sometimes be frustrating and time consuming to pursue debts owed. Multiple requests for payments are often met with continual promises to pay from debtors, however no money may be received or payment is slow. We therefore explain some effective recovery options in this eBites article for you.

Company Debts
For debtors who are companies, commonly the most effective way to get paid is to issue the debtor company with a Statutory Demand under the Companies Act. Such a formal Demand can be used when the amount owed is $1,000 or more.

In essence, the Demand should outline the amount owed and request payment within 15 working days. Failure to pay or otherwise come to an agreed arrangement means you can apply to the Court for the debtor company to be liquidated. This is something companies usually wish to avoid, so the Demand can be a great recovery tool.

If the debtor company does end up being liquidated, there may be insufficient assets for all creditors. We therefore recommend our clients to obtain personal guarantees from Directors of any company customers. They can then pursue the Director(s) personally to recover what is owed.

Consequently, ensuring your terms of trade and customer credit application forms are up to date and comprehensive can be really beneficial for debt recovery.

Debt owed by an Individual or Business
Where a debt is owed by an individual or a business (that is not a company), or where the debt is owed by a company but the amount owed is under $1,000, you can go to the Disputes Tribunal or the District or High Courts and apply for judgment against the debtor.

The Disputes Tribunal is usually cost effective and quick. It's able to deal with claims up to $15,000. Parties can’t be legally represented at the Tribunal hearing.

For those debts over $15,000 and under $350,000, you can apply to the District Court for judgment against a debtor. For any amount over $350,000 your claim must be filed in the High Court. Both Courts also have the ability to give Summary Judgments which, in contrast to regular court cases, can be faster and less expensive as they don’t require the same level of procedure. We can help in choosing the type of procedure required in any given case.

Once you’ve got a Judgment there are all sorts of ways you can enforce it so as to ensure you get paid. Commonly in cases where a smaller debt is owed, you could apply to have the debtor assessed by the Court as to their financial ability to pay. Orders may be made for instalments to be taken directly from their wages (for an individual). Alternatively, for larger debts, applications to obtain a charge over, or sell, a debtor’s property are available as is an application to make a defaulting individual debtor bankrupt. Like a Statutory Demand, that last option can have devastating consequences for individuals, who usually take all steps possible (such as paying up) to avoid it.

If you want to know more about getting paid or would like further information on how to ensure your terms of trade protect you as creditor, please contact Holly Brown, Senior Solicitor, in our Litigation Team, Ph 03 379 4660.

838 days ago

Get Your Own Building Report

Steven Duxfield from Corcoran French

Building inspection reports have become a common feature of the residential property market in New Zealand. However, in post-earthquake Christchurch, where earthquake damage can be missed or repairs done hastily, building inspection reports are vital. We are increasingly seeing properties being … View moreBuilding inspection reports have become a common feature of the residential property market in New Zealand. However, in post-earthquake Christchurch, where earthquake damage can be missed or repairs done hastily, building inspection reports are vital. We are increasingly seeing properties being sold “as is where is” or sold by a vendor that did not conduct or oversee earthquake repairs. In this context it is worth noting that a mix of different reports and advice is the safest way to guard your future investment.
The recent High Court decision of Steel v Spence Consultants Limited has reaffirmed the advice that you should get your own building inspection report. Vendors selling at auction or trying to make their property look more attractive to buyers often have a building inspection report conducted in advance so they can pass this onto purchasers. In Steel the vendors commissioned a building report prior to putting their property up for auction. The purchasers at auction relied on this report in the auction package instead of requesting their own, particularly its statements regarding weathertightness which were later proven to be incorrect. The purchasers brought a claim in the High Court following settlement when weathertightness issues presented themselves and were successful at trial receiving an award of $85,000 plus interest in damages. However, they were only successful in receiving half of the damages claimed because they did not seek their own report or building advice nor did they seek clarification where comments in the report raised questions. In addition, the purchasers were unsuccessful on one of the two grounds they argued on the basis of the disclaimer included in the building inspection report.
The question this raises is, how does a prospective purchaser protect themselves when buying a property at auction or where a building inspection report is already provided?
• Seek your own building inspection report and if possible seek other professional advice regarding the state of the dwelling, particularly if you are buying in Christchurch.
• Steel has suggested that the experience and position of the purchaser is relevant, for example a first home buyer is expected to know less than an investor with several properties in their portfolio.
• Clarify the position surrounding any earthquake related repairs and seek building advice in light of the repair work conducted.
• Seek legal advice regarding the effect of any disclaimer in the building inspection report. If the report is limited in its scope, you should be asking why this is the case.
• Review the building report carefully and discuss it with whoever has conducted it. If you are unsure of the practical consequences of any comments or elements of the report then you should query these.
Ryan Keen is a Solicitor in Rowan Aspros' property team and can be reached on telephone (03) 379 4660 or email: ryan@corcoranfrench.co.nz

851 days ago

Auction Preparation

Steven Duxfield from Corcoran French

Auction Preparation
Property is often purchased and sold in New Zealand, particularly in a seller’s market, via auctions. However, buyers frequently underprepare for an auction and are caught out when the hammer falls.

When purchasing at auction, a buyer is making an offer unconditionally. In … View more
Auction Preparation
Property is often purchased and sold in New Zealand, particularly in a seller’s market, via auctions. However, buyers frequently underprepare for an auction and are caught out when the hammer falls.

When purchasing at auction, a buyer is making an offer unconditionally. In essence, this means that the highest bidder over the reserve (being the lowest sum that the seller determines it will sell at) is making a binding cash offer and entering a binding agreement with the seller.

Accordingly, buyers need to have completed all of their due diligence investigations and asked all of their key questions before the auction.

Talk to the agent
Before attending and bidding at an auction, buyers should obtain as much information as possible about the property by:

• Talking to the listing agent;
• Reviewing the history of the land and the buildings via reports provided by the seller, the agent or purchased via a lawyer or the local council; and
• Asking questions about the number of parties interested in bidding at auction and at what price such parties are registering their interest.

Some of the types of reports that a buyer might need will be contained in the agent’s auction pack.

Any buyers considering a bid should register their interest with the agent.

If a third party makes a pre-auction offer, the auction must be brought forward. As such, interested buyers will need to be prepared to bid at the early auction, including having funds available to pay the deposit which must be paid on the auction day.

Review the auction terms and conditions
The agent should provide potential buyers with a copy of the auction terms and conditions of sale.

Buyers should review these terms carefully, to ensure that the proposed chattels list is correct and that the settlement date is practically and financially achievable.

Buyers should also be checking these terms to see whether any standard conditions have been deleted or varied, including disclaimers of warranties or information about a property. This aspect (if not the terms as a whole) should be reviewed by a lawyer for certainty.

Get legal advice on the title
In becoming the buyer, the successful bidder will have accepted the legal title to the property (the instrument that details the key legal interests and restrictions that apply to the land) and the auction terms and conditions of sale. It is, therefore, extremely important that prospective buyers seek advice on the title before attending an auction; prudent buyers will also have taken advice on the auction terms and conditions of sale.

If, in obtaining advice, a buyer discovers an issue with the property, agreement or the title, he or she may raise such an issue as part of pre-auction negotiations. In some instances, variations may be agreed such that they apply in respect of the successful bid as between the seller and the particular buyer that negotiated such variations.

Due diligence
A Land Information Memorandum (LIM) is a report prepared by the relevant Council which provides historical and current information relating to the property, land and any buildings. Prospective buyers are strongly advised to obtain a LIM report.

A LIM report enables a buyer to ascertain whether buildings and/or structures on the land which require consent, such as a dwelling, spa pool, garage or fireplace have been approved by the local council. In addition, a LIM report may provide information on the zoning of the area and natural hazards.

Builder’s report and contamination testing
Obtaining a builder’s report entails engaging a qualified builder to perform a pre-purchase inspection, and provide a written report outlining any significant building defects. A comprehensive builder’s report can be expected to include advice on fences, paths, retaining walls, foundations, insulation, ventilation, plumbing, drainage, structures and roofing materials.

Contamination tests are also becoming more common. Contamination tests measure toxicity within a building, and provide information on whether it is safe to work or live in. High toxicity levels may result in health risks and time consuming and costly decontamination processes.

Finance
As auctions are based on potential buyers making unconditional offers to the vendor, it is essential that any necessary finance is arranged prior to bidding at auction and that buyers are in a position to draw down the funds on the designated settlement date.

Summary
In summary, buyers should gather as much knowledge as possible on a property before bidding at an auction. Doing so will enable buyers to better set a purchase price that they may be comfortable bidding to; it will also help the bank and insurance brokers to give a keen buyer the promises and backing that he or she needs to bid.
Considering bidding at an auction?
Contact Michael Bendall on (03) 327 8159 or michael@corcoranfrench.co.nz (Kaiapoi) or
Rowan Aspros on (03) 379 4660 or rowan@corcoranfrench.co.nz (Christchurch).

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