Mackenzie Elvin

Common Questions About New Zealand Law

There are many situations where a lawyer can add value. Lawyers can of course assist you after problems arise, but seeking advice proactively can help you anticipate and prevent serious legal problems and save you significant amount of time and money.

Some common situations where advice from a lawyer include:

• Getting married - 'Contracting Out Agreements' (aka pre-nups)
• A family problem such as a divorce, child custody or Will dispute
• The sale or purchase of a property or business
• The formation or incorporation of a business
• The drafting of a Will, Trust or estate plan

Your lawyer will evaluate all aspects of your particular situation, explain your options and what to expect at every step, all with an eye toward ensuring the best possible outcome for you.

A Trust is a recognised legal entity often used for passing assets to the next generation and protecting the assets from 'predators' or people or entities you don't want to have access to them.

To ensure that all the trustees are up to date with any changes relating to Trust property or relevant relationships.

Whenever your circumstances change - if you're getting married, you've had a death in the family, you're setting up a Trust, receiving an inheritance, or any other time when you're undergoing a significant change in your life.

It's probably a good idea, yes. Marriage can affect your property interests so it's a good idea to seek an audit of your property structures before the big day. A 'Contracting Out Agreement' or a family Trust may be appropriate safeguards.

As well as this, your Will also needs to be updated as it is automatically revoked by a marriage or civil union (unless it has been specifically made "in contemplation" of marriage/civil union). We have an interesting article on Wills here.

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It's a good idea to consider whether you want to opt out of the standard property sharing principals that are set out in New Zealand law. It may be that you're happy for these to apply, but you might decide that you'd prefer to tailor the arrangements to suit your particular situation.

If so, we will help you set up a 'Contracting Out Agreement'.

These agreements are very common with couples who are entering a second or subsequent relationship later in life, particularly when there is substantial property that they want to keep separate. They're also common when assets are held in a family Trust as they can help to ensure issues of relationship property are dealt with as intended by those who established the Trust.

Lawyers talk about the "Executor's Year" which is a period of one year from the date that the Courts give legal authority to someone to administer the affairs of a deceased person.

This legal authority is called "Probate" if there is a Will, or "Letters of Administration" is there is no Will. The reason it is a year is because that is the time limit for legal claims to be made against the estate. In reality though, many estates are finalised well within a year so long as there are not too many complications and little likelihood of anyone making a claim against the estate.

Yes - it's always advisable to have a lawyer look at the agreement before you sign it. Our ability to protect your interests is far greater before the agreement is signed than afterwards. This applies even if there is a clause in the agreement making the contract conditional upon our approval.

A lawyer can help you avoid some potential problems with a home purchase or sale. Here are a few issues you may need a lawyer to help you with prior to signing a contract:

• If the property has been altered, was it done lawfully?
• When and to whom should the deposit be paid?
• What happens if there are issues revealed by a building report or weather-tightness report?

The potential for disaster is great – one mistake could be very costly to you. Often a real estate agent puts the contract together so before signing you should let them know that you want your lawyer to look over it first. Don't be pressured!

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Real estate agents will usually get a seller to sign a listing agreement when a property is placed with them for sale. Following the passing of the Real Estate Agents Act in November 2009 most standard real estate listing agreements have been extended to include additional warranties, undertakings and indemnities by you as the seller of the property.

For example, the listing agreement may include a warranty from you that the building is weathertight and free from hidden or underlying defects or include an indemnity giving your real estate agent the right to recover assets from you if they are sued by a purchaser of your property for giving them incorrect or incomplete information provided by them or your agent.

We suggest you seek legal advice before signing in order to ensure you know what you are agreeing to and don't overlook matters that may prove costly.

Leaky building litigation can be expensive, time-consuming and unpleasant for all concerned. We work closely with you to come up with the best course of action for your particular situation.

Whilst it is true that often parties do not meaningfully contribute to a solution until court action is taken, not every situation requires court action. In some cases mediation and other forms of dispute resolution can lead to a satisfactory outcome.

The term "conveyancing" describes the legal process when a person becomes the registered and lawful owner of a property.

A conveyancing transaction involves a chain of steps which begins with the Agreement for Sale and Purchase and continues through to the ultimate registration of ownership of the property, and the reconciliation of finances and payments.

Conveyancing is a complex process requiring extensive knowledge, skill and attention to detail on the part of the conveyancer. There are many elements involved in the conveyancing transaction and delays are possible at any stage. A typical conveyance includes:

• Title searches
• Checking for encumbrances and restrictions on the property
• Ensuring any special conditions are met
• Financing arrangements
• Making sure rates are paid by the appropriate party
• Arranging for payment of fees and charges
• Preparation of legal documents
• Registration of ownership on the title.

We are equipped with comprehensive legal skills to advise on all aspects of your property transaction and are backed by stringent safeguards administered by the NZ Law Society.

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Naturally costs will vary depending on the work we're doing for you. Each situation is considered individually and we look at a variety of criteria approved by the Law Society including; 

• the degree of urgency
• what specialist knowledge is required
• the result to you

Q I'm about to employ staff for the first time. Do I need to give them an employment agreement?

Yes. The employment laws require all employees to have a written contract, which must include a statement setting out their legal rights as an employee.

Q What does 'good faith' mean in employment law?

In an employment context the term 'good faith' refers to two parties dealing with each other openly and honestly and taking active steps to enjoy a good working relationship. It applies between employers and employees, unions, unions and their members and so on.

In the Employment Relations Act the term is wider than an obligation of trust and confidence. Where an employer is making decisions that may have an adverse effect on employees they are required to provide the employees with access to the information and an opportunity to comment before a decision is made.

There is also a code of good faith that applies to collective bargaining.

Q What's the difference between an individual and a collective employment contract?

An individual employment agreement is one with an individual employee. Collective agreements are with groups of employees and are most often (but not always) negotiated by a union.

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Q What is 'due diligence'?

Due diligence is a process carried out by someone looking to purchase a business or enter into an investment opportunity.

The process involves looking at the financial and legal records of the business and any other relevant material to ensure that you know what you are buying. In the case of an investment, the potential investor would consider the prospectus or investment statement issued in respect of the investment as part of their due diligence.

Due diligence is a very important step in any business purchase transaction or investment decision. Mackenzie Elvin can assist purchasers with the due diligence process and planning irrespective of the size the business being purchased or investment being made.

Q What is the Personal Property Securities Act and how does it affect me?

The Personal Property Securities Act (PPSA) came into force in 1999 and the main purpose of the Act is to consolidate the law relating to the security of personal property such as motor vehicles, boats and fixed and floating charges previously registered at the Companies office. Interests are now registered on the Personal Property Securities Register (PPSR).

Before you purchase a motor vehicle of any sort or boat or plant and machinery (in fact any part of property where you are paying good money for it) you should ask your lawyer to check the PPSR to make sure there are no other interests registered against the property you are looking at purchasing.

If you are in the business of hiring or leasing equipment or providing goods on credit, you need to register your interest in the goods on the Personal Property Securities Register (PPSR) to ensure that your interest in the goods is protected. Your terms of trade need to include provisions that will allow you to register your interest on the PPSR.

You could lose your rights to the goods if your terms of trade are not drafted properly, or your registration is incorrect or not lodged within the required timeframes. Mackenzie Elvin can assist you with reviewing and updating your terms of trade, registration on the PPSR and with all other PPSA issues.

Q Why do I need a formal Terms of Trade document for my business?

You need terms of trade so that your customers know exactly what basis on which you are supplying them with goods and services. As a business owner your terms of trade form the legal contract between you and your customers. At the very least they should set out what your terms of credit are (if you are giving credit), such as payment being due on the 20th day of each month and setting out an interest rate if payment is not made. They can also set out limitations on your liability for claims made in respect of the goods or services you are supplying.

If they relate to a business activity then yes. If the expenses relate to the purchase of a capital asset like a building, they may not be fully deductible in the year incurred. Instead they will be depreciated over the life of the asset.

• Email Marcus Wilkins a question about property or commercial law

• Email Ilati Vukona a question about family or employment law

• Email Katie Graham about family or commercial law

• Email Evan Christensen about family trusts, estate administration, wills and succession planning, or Enduring Powers of Attorney

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