Our Services   |   

    Trusts

    Contracts

    Dealing with Regulatory Bodies

    Foreign investment in Australia

    Employment Law

    Licensing

    Business Structures and Development

    Farming matters

    Franchising

    Intellectual Property

    Buying and Selling a business

    Joint Ventures

Trusts

A trust is a legal instrument that allows the donor (or settlor) to transfer the title in an asset to a trustee. The trustee will hold and manage that property for the benefit of another, known as the beneficiary.  

This creates what is called a fiduciary relationship. This means that the trustee has an obligation to act in the best interests of the beneficiary when dealing with that property. Any breach of that duty may give rise to legal action.  

The beneficiaries’ rights are limited as they do not have any control over the trust, other than to potentially receive income, ensure that the trustee exercises his duties or terminate the trust.  

What types of trusts are there? 

There are a range of trusts for different purposes: 

  • A fixed trust may be set up for the benefit of a particular individual, or number of identified individuals. This type of trust is frequently used to establish children as beneficiaries and allow them to receive income when they reach a particular age.  
  •  A discretionary trust allows the donor to identify a group of people as beneficiaries. Here the trustee is given the discretion to decide how the proceeds of the trust will be split between beneficiaries.  
  • Fixed and discretionary trusts can be used in a business context for significant tax and business advantages. Where there are a number of investors contributing capital to an enterprise and a company structure is not appropriate a trust may be useful.  
  • In some senses a unit trust is similar to a company, where a contribution represents a unit of capital in the company. However, the rules governing a trust are entirely different - a trust is controlled by a trustee, not the beneficiaries, while a company is ultimately controlled by its members, not the directors.  
  • A trust might hold business assets and allows flexibility in the distribution of trust income between beneficiaries. A company itself may be established as trustee or a beneficiary.  
  • Should you wish to donate assets for the benefit of the community, for instance for educational purposes or a religious institution, a charitable trust may be an effective way to do so.
  • Court-imposed trusts include constructive trusts and resulting trusts that will only be imposed by the court in the interests of fairness and protection. Avon Legal can advise you if this type of remedy is sought in litigation. 

A trust can be tailored to your requirements, to reflect your conditions and situation.

The Avon Legal Business Law Team will be happy to advise you on whether a trust is suitable for your needs.

Contracts

Contract is one of the most pervasive and important areas of business law. It arises when selling assets, employing a new team member, even when simply buying a water cooler. 

A contract is a promise enforceable by law, where two or more parties enter into an agreement to complete or not complete an act in exchange for due consideration (ie. payment).  

A clear and fair contract is your greatest tool in avoiding future disputes and ensuring that, should they arise, they might be resolved quickly. 

The Avon Legal Business Team can assist you in drafting a contract and negotiating the terms of that contract on your behalf. 

What if I have a dispute over an existing contract? 

Disputes over contract breach can be time consuming and costly if not handled correctly. Avon legal may advise you on the best course to take should you find yourself unable to resolve a contract dispute. This might involve litigation or alternative dispute resolution.

Dealing with Regulatory Bodies

Dealing with regulatory bodies can be a complicated and time consuming process. These bodies provide some important protections to businesses and consumers. Most businesses will be subject to the rules of at least one regulatory body and might be subject to disciplinary action should they breach those rules.  

Avon legal are able to assist in giving you general legal advice and helping you through the process of dealing with regulatory bodies.  

Some major Government regulatory bodies include: 

Australian Competition and Consumer Commission

The ACCC operates under the Trade Practices Act. This Act effectively focuses on consumer protection and a breach may result in legal action. However the ACCC also provides information to business regarding their rights. The Department of Commerce Consumer Protection Division plays a complimenting role in WA.  

For more information please visit:

http://www.accc.gov.au/content/index.phtml/itemId/815329

http://www.docep.wa.gov.au 

Fair Work Australia

Fair Work Australia replaced the Industrial Relations Commission in 2009. FWA deals with issues such as workplace conditions, industrial disputes and wage and dismissal complaints. If a dispute arises you may have to attend a hearing or conference to attempt a resolution. Although a legal representative is not allowed at these meetings without prior permission, Avon Legal can assist you with advice and preparation if a meeting is anticipated.  

For more information please visit:

http://www.fwa.gov.au/ 

Australian Taxation Office

Although Avon Legal does not provide financial tax advice, situations do arise where there might be a dispute between the ATO and a business over legal construction. This may affect the amount of tax paid. 

For more information please visit:

http://www.ato.gov.au/ 

WorkSafe (WA)

WorkSafe is the body that regulates the Occupational Safety and Health Act 1984 in WA. They provide some services for small businesses, with the aim of minimizing death and injury in WA work places in compliance with their regulations. They are also responsible for prosecution under the Act.  

For more information please visit:

http://www.commerce.wa.gov.au/WorkSafe/ 

State Administrative Tribunal

State- based regulation and enforcement, including professional disciplinary proceedings of many industry specific codes are often conducted by the State Administrative Tribunal. Proceedings in the SAT are intended to be more informal and speedier than those in the court. Avon Legal has extensive experience in dealing with SAT proceedings and would be happy to help you through the maze.  

For more information please visit:

http://www.sat.justice.wa.gov.au 

There is a variety of industry specific and non- government regulators in operation as well.

Foreign investment in Australia

Western Australia boasts a thriving economy. With a plethora of natural resources and primary produce, it will no doubt be regarded as the economic backbone of Australia and a stable investment for a great many years to come. Whether you are looking to invest in property or business, there are certain rules in place for foreign investment in Australia.  

Investing in Real Estate

Foreign investment in Australian real estate is a sensitive area and as such, special rules apply. Prior to entering into any contract for the acquisition of real estate, purchasers must get approval from the Foreign Investment Review Board.  

Individual foreign investors are either classified as non- resident or temporary.  

As a general guideline: 

If you are an individual:

  • You may not purchase a second- hand dwelling in Australia for investment purposes. A temporary resident may purchase a second hand dwelling, but must undertake to sell the property when it is no longer their residence.
  • You may purchase new and off- the- plan properties.
  • Vacant residential land may be purchased if you will build on the land within 24 months.
  • Investments in second- hand commercial property is usually approved, subject to the national interest, and commercial property for development is subject to conditions imposed by FATA.  

If you are a foreign company:

  • FIRB will generally approve purchase of second hand dwellings for your staff in Australia, provided your company undertakes to sell the property within 6 months if you expect it to remain vacant.
  •  Your company may also purchase new and off- the- plan and vacant residential land.
  • Investments in second- hand commercial property is usually approved, subject to the national interest, and commercial property for development is subject to conditions imposed by FATA.  

Every property is unique and may be subject to different rules or exceptions. It is therefore important to seek advice from Avon Legal tailored to your specific situation and the property you wish to purchase.  

Investing in Business

Generally, foreign investment in Australian Businesses is welcomed, unless the Government deems it ‘contrary to the national interest’. This might be the case in more sensitive industries such as real estate.  

Avon Legal remains abreast of developments in this area of the law and is able to inform you on whether your intended investment will meet Government standards.

 It is strongly advised that you seek legal advice if considering investment in Australia. Avon legal would be happy to help you with any queries and through the legal process of purchasing assets in Australia.  

USEFUL LINKS 

For more information on foreign investment in Australia please visit:

http://www.firb.gov.au/content/default.asp 

For more information on foreign investment in real estate please visit:

http://www.reia.com.au/policy-government-foreigninvestment.php 

Employment Law

Whether you are an employee or employer, Avon Legal is able to help with your Employment Law disputes.  

Drafting Employment Contracts

Avon Legal helps you to establish the rights and responsibilities of an employee and your obligations as an employer.  

Wrongful Dismissal and Unfair Dismissal

Wrongful dismissal occurs in breach of your employment contract under the common law.  

You might be entitled to specific performance of your employment contract or, more frequently, compensation for the breach of contract. This payment might include damages for wages or superannuation lost and for any injury incurred, such as mental illness, as a result of the wrongful dismissal.    

Under the Fair Work Act 2009 employees are also given a statutory cause of action in unfair dismissal. Only employees who meet certain criteria are able to bring an action under this act. Please note a notification of unfair dismissal must be made within 14 days of the dismissal. Similar remedies are available as under the Common Law, with reinstatement or limited compensation possibilities.  

Redundancy 

An employer might make a person redundant when their job role (not the employee themselves) is no longer required. Depending on the nature of your employment and of the business, you may be entitled to receive or obliged to make a redundancy payout under the Fair Work Act 2009.  The amount of the payout depends on a variety of factors. These include the length of service and types of losses suffered by the employee as a consequence of redundancy, from loss of job security to loss of annual leave.   

Workplace Discrimination

Workplace discrimination might arise when you are treated differently or unfairly to other employees as a result of one of a defined category of personal attributes, such as disability, race or political belief. There are a variety of intersecting acts which offer employees protection, including the Fair Work Act 2009, the Sex Discrimination Act 1984, the Racial Discrimination Act 1975 and the Disability Discrimination Act 1992.

If you believe you have been or are the victim of workplace discrimination it is useful to keep a record of any discrimination and seek legal advice as soon as possible.  

Regulatory Bodies and Disciplinary Hearings 

Most industries need to comply with certain guidelines established by the Government or non- Government regulators. For example, key amongst these for many businesses is the Trade Practices Act, enforced by the ACCC, which determines the duties owed by a business to consumers and the penalties available for breach of that Act.  

Many professions require registration with and are subject to disciplinary hearings by profession- specific regulatory bodies. For instance, the recent introduction of the Health Practitioner Regulation National Law (WA) Act 2010 saw dramatic changes to the registration and regulation of health practitioners across a wide range of disciplines.  

Therefore it remains vital in the interests of compliance that all businesses stay up- to date with developments in the law.    

If you have questions on Employment Law or there is a disagreement between yourself and your employee or employer, it is important to seek legal advice. Early advice can prevent the considerable expense and time associated with legal action. Further, there are limitations on the amount of time that might pass between a dispute and bringing an action. These time limits can vary between different causes of action, so it is best to consult with your Avon Legal team as near as possible to the time of the dispute.

Licensing

Commercial Licensing 

In a commercial context, licensing allows parties to contract out the use or benefit of assets while still maintaining ownership and a degree of control. A license may be an appropriate instrument for your goods, services or premises.  

Although similar, a license often provides more limited rights and protections than a lease or rental agreement. A license agreement gives a right to usage and is suitable if the use of assets is not exclusive, or needs to be restricted to some extent. It is vital that license agreements are clear on points such as duration, termination rights, and permitted and restricted uses.   

If you are looking to enter into a licensing agreement or need general advice on an existing license, please do not hesitate to contact us at Avon Legal.  

Liquor Licensing 

In Western Australia there are 10 different categories of liquor license available. The type of license will determine how and when you may supply alcohol. Applications for a license are made through the Department of Racing, Gaming and Liquor.  

The procedure of applying for the correct license for your business and undergoing review can be challenging and confusing. Avon Legal is able to help you through the process 

Professional and Trade Licensing 

There are a number of licensing boards that regulate different industries in Western Australia. Generally these boards will grant licenses to those professionals who meet the regulator’s standards in qualification and experience. This is to ensure those persons licensed are and continue to be compliant with industry standards and principles of health and safety. If there is a breach of those standards a license holder may be subject to disciplinary action or loose their license.  

Some of these bodies include:

  • The Plumbers Licensing Board
  • Builder’s Registration Board
  • Energy Safety
  • Motor Vehicles Branch, Department of Employment and Consumer Protection
  • Real Estate & Business Agents Supervisory Board
  • Department of Commerce: High Risk Work; Asbestos and Demolition Licensing
  • Australian Health Practitioner Regulation Agency 
  • If you need advice on registration in Western Australia or on dealing with a licensing body please do not hesitate to contact Avon Legal.  

What if I hold a license in another jurisdiction?                                                                                           

The Government provides a service to determine whether you will need to apply for a new license or whether your existing license would be recognised in Western Australia. Please visit their website at http://www.licencerecognition.gov.au and contact Avon Legal if you have any further questions or concerns.  

USEFUL LINKS 

For more information on liquor licensing in Western Australia, please visit:

 http://www.rgl.wa.gov.au/ResourceFiles/Publications/RGLCDRom2009-10.pdf 

Business Structures and Development

When starting a new business it is important to choose a structure that compliments your work and allows for future expansion. You will need to consider the pros and cons in terms of liability, income, tax and governance. There are a number of structuring options available that the Avon Legal business team would be happy to discuss with you. 

Proprietary Limited Company

This is perhaps the most common business structure in Western Australia. A proprietary limited company is registered under the Corporations Act 2001. Companies are governed by this Act along with your company constitution. The company is controlled by shareholders and run by directors. Your company will be treated as an entirely separate legal entity or individual, meaning that liability is ‘limited’ to the company. A company will also be taxed as a separate entity, which can be a major advantage.   

Partnership

A partnership structure is often favoured by smaller professional practices. A partnership is defined as people carrying on business together with a view to profit. Unlike a company, a partnership is not a separate legal entity. A partnership will be governed by the terms of an agreement, as determined by the partners with the help of your Avon Legal team.  

Joint Venture

If you are considering a business enterprise in conjunction with another business for a limited purpose and duration, you might consider a entering into a joint venture agreement. This structure is often used in a mining exploration context, where the relationship between the parties is not intended to continue beyond that activity. A joint venture arrangement can allow for the pooling of resources while at the same time allowing you to retain your autonomy.  

Trust

A trust may be a useful tool in company structuring for the collection of capital where incorporation is not desired or appropriate. Please see our section on trusts for more information.  

BUSINESS DEVELOPMENT 

A thriving and expanding business will often present challenges that were not anticipated when your business was first established. You may need to consider changing your business structure to accommodate the growth of your business. It might be necessary to redraft constitutions and agreements. Whatever your requirements, Avon Legal is available to help ensure that your business can reach its maximum potential.  

Farming matters

As a law firm representing the interests of hundreds in the Avon region, Avon Legal has extensive experience assisting farmers and those in rural areas. Avon Legal can provide advice tailored specifically to your situation.  

Share Farming Agreements

Share farming agreements begin and operate in response to an increasingly competitive market in primary production. They allow for an economical contribution of resources to maximize the potential profits of both parties.  

A share farming agreement is flexible to your needs and can work in a number of ways. It may allow a farmer who is asset rich in labour and machinery to share with a farmer who has land, but none of the assets required to cultivate. It may allow labour and other capital spent on the land to be split between parties.  

A share farming agreement is not a lease. It is a unique legal relationship. It requires considerable experience to draft an agreement that ensures the proportionate split of rights and responsibilities meets the needs and approval of all parties. There are a range of issues to consider: whether an expert evaluator ought to be employed, insurance and tax, management of the farm, profit splits, how long the agreement will run and which party supplies what.  

A clear agreement is your greatest tool in promoting a thriving working relationship and in preventing future disputes.    

Property Transactions

The sale and purchase land can have far more significant consequences in a farming context than in any other. It represents your business and livelihood. The sale or purchase of land can be a momentous step not only for you but for many generations to come.  

At Avon Legal we understand that. With long experience in conveyancing and property advice, Avon Legal strives to make the acquisition or sale of land pain free. 

General Advice

As a farmer you will encounter many legal issues, ranging from running your business, honouring contracts, succession and liability. If you have any concerns, Avon Legal would be happy to assist. Remember a little legal advice when a problem first arises may prevent considerable conflict and expense in the future.

Franchising

Franchising is a huge business in Australia. The benefits of running a franchise are enormous- consistency, customers and reputation cannot be bought but might be acquired when you purchase a franchise in an established name. Similarly, if you are looking to expand your business, a franchise may be a cost and time effective way of doing so.

According to the Franchising Code a franchise means that one party gives another the right to supply goods or services as a business under a ’specific system or marketing plan’. This business will be connected with a trademark or advertising campaign utilized by the franchisor. These rights will be granted to the franchisee in exchange for payment on commencement or on a continuing basis.  

Drafting and preparation of franchise agreements and associated documents

It is important to ensure that your franchising agreement accounts for all eventualities. This can include choosing dispute resolution forums, the inclusion of any important undertakings made in the course of negotiation and making provision for the events of termination, transfer or insolvency.  

The purchase of a franchise can be a significant investment. It is important that both parties are clear on what they are contributing to the running of the franchise and what benefits they are entitled to.  

If is strongly recommended that you seek independent legal advise when entering into negotiations for a franchise agreement. It is equally important to have your legal adviser involved in the drafting and preparation of franchise agreements and documents.  

General franchise advice to both Franchisees and Franchisors

If you are facing a dispute with your franchisee or franchisor or you simply wish to better understand your rights under the franchise agreement, please do not hesitate to contact Avon Legal. The Avon Legal Business team has assisted many clients through the franchising process and with any later issues that havearisen.

USEFUL LINKS 

For practical advice on entering into a franchise agreement please visit:

http://www.accc.gov.au/content/index.phtml/itemId/6118 

Intellectual Property

Intellectual property is a complex and continually evolving area of the law. It operates in an entirely different way to physical property. Intellectual property can be created as the result of innovation in a broad range of areas; commercial, artistic, scientific and industrial.  Such innovations have the potential to change your business, your industry or even the world. They also have the potential to be extremely lucrative. So it is important to know you rights and how to protect your intellectual property. 

Patents

A patent is generally granted over an invention. For instance, the inventor of a new software package might be granted a patent which will give him exclusive control over that design, or a monopoly, for a period of 20 years.  

Patents may also be granted for innovations which are small steps or alterations than would not qualify as inventions and yet still require protection. The monopoly over these will last for 8 years. After this time has expired the invention which is the subject of the patent might be used by all.  

Trade Marks

Trade marks can be any logo, design or the like, which is affixed to your goods or services to distinguish the product from your competitors as your own. A trade mark can be a seal of quality and a means of recognition, carrying with it the reputation of your business.  

For these reasons, it is advised that you protect your trade mark through registration under the Trade Marks Act 1995. 

Trade Secrets

A trade secret, or confidential information particular to the running of your business, is often vital in giving you a competitive advantage over others. There might be no monetary value on that information, however if that information falls into the wrong hands it can be commercially devastating. The law of equity recognises the importance of trade secrets and allows the courts to intervene in instances of a leak or threatened leak of confidential information. The court may grant an injunction to prevent disclosure, or damages if disclosure has already occurred.

It is recommended that all employees and others who may be exposed to confidential information in the work place sign a confidentiality agreement to protect that information from dissemination.  

Contract and IP

Innovation may often be the result of work undertaken in the course of employment. In that situation, it is important that all parties, including the employer and the employee, understand their rights in relation to that intellectual property.  

Registered Design

Occasionally the design of a product is itself one of its most recognisable features. As with a trademark, protection of that design is also a means of protecting the reputation of your product. A registered design can give you a monopoly right over the ‘look’ of your product.  

The Copyright Act

Works under the copyright act are works of creative endeavor. They are not merely ideas, but must be manifest in some physical object, such as a canvas, book or recording. The advantage of intellectual property that comes under the Copyright Act is that rights in that object accrue automatically. It is not necessarily the creator of the work who owns the copy rights, depending on agreements with employers or contractors.  

If you are looking to register or safeguard your intellectual property or if you feel that somebody has breached your intellectual property rights, we recommend you seek legal advice. Avon Legal has extensive experience in business intellectual property and would be happy to assist.  

Buying and Selling a business

The choice to purchase a new business can be one of the biggest decisions in your life. There may also come a point where it is time to move on and sell your business- perhaps you want to start a new enterprise or a relaxing retirement beckons. Whatever your situation, Avon Legal is available to help you through the process of buying or selling your business. 

BUSINESS PURCHASE  

Purchase of a Business through Shares

A proprietary limited company is the most common structure controlling business in Western Australia today. Purchase of a proprietary limited company can be achieved by purchasing a controlling interest (over 50%) of the shares in that company. Many proprietary companies only issue a few shares.  

This control means that you are able to make decisions on all financial and operating aspects of the company under the Corporations Act 2001.  

A purchase or sale of this kind has the advantage (or possible disadvantage) of allowing another party to retain an interest in the company, even though they do not have the ‘controlling’ share. 

Purchase of a Business through Asset Acquisition

It is also possible to gain control of a business by purchasing all of its assets, for instance leases, supply contracts and good will. This type of purchase is necessary where the business is not controlled by a proprietary limited company. It is also useful when the controlling company runs several businesses and you only wish to purchase one.  

CONSIDERATIONS WHEN BUYING AND SELLING A BUSINESS 

Employees

When a business is sold employment contracts are automatically terminated. However existing employees are often immeasurably valuable and the buyer may undertake to become their new employer. As a buyer, this means you will need to consider your obligations as an employer ranging from wage payment, leave, superannuation and all relevant legislation. Existing employees are also within their rights to reject an offer by the buyer to continue employment.  

If you are selling your business and the buyer has not undertaken to continue employment contracts, the seller will be responsible for abiding by the standard guidelines for termination. This includes giving due notice, letting employees know about the anticipated changes to the business, severance pay in some instances and paying out accrued entitlements.  

Lease assignment

Businesses frequently operate out of leased premises. The lease will not automatically transfer with the transfer of the business, so it is important to consider your liability under the lease and the assignment of the lease to the new tenants.  

Debts

There are a variety of debts that will need to be addressed upon the sale or purchase of your business. They not only need to be accounted for financially, but legally within the terms of the transfer contract. These can include loans requiring repayment or debts owed to the business. Capital Gains Tax can be significant, and there will also be other tax implications. For more information, please discuss with your financial adviser and the Avon Legal Business Team. 

Know What You are Buying

It is vital that you are fully aware of what you are getting as a buyer when you hand over the cheque. As a buyer, you have a duty of due diligence so inform yourself to the extent that you are fully confident in your purchase. Ensure that all trade agreements that you intend to continue are in writing, know what physical assets, fixtures, premises and stock are included in the purchase. Understand how the business is run and be confident that the amount you are paying for the ‘goodwill’ of the business is reasonable.  

Be Aware of Legislative Requirements

It is particularly important when purchasing a company that you are sure of all your obligations in management, reporting and standards of conduct under the Corporations Act.  

With years of experience, Avon Legal knows what you need to make an informed purchase and understands the pitfalls and problems associated with buying a business.

Avon Legal is here to help you through the negotiations, drafting and transfer of your business, whether you are seller or buyer. Please contact our Business Team if you are considering buying or selling a business.  

USEFUL LINKS

The government provides a useful website which considers practical questions on the sale of a business:

http://www.smallbusiness.wa.gov.au/selling-a-business/ 

For information on your obligations to employees, please visit:

http://www.commerce.wa.gov.au/LabourRelations/PDF/Factsheets/Buying__selling_08.pdf

Joint Ventures

A joint venture is an arrangement where two (or more) companies partner in order to achieve a single goal. Generally the companies only intend to work in partnership for a relatively short period of time. For example, companies might enter into a joint venture for research, mining exploration, or the development of a building. 

The concept of a joint venture is ultimately that ‘two heads are better than one’. Companies can pool capital, technologies and resources with a common purpose, allowing all partners to benefit and achieve results they may not have reached on their own.  

Not only do the business partners share the benefits, they must also share the risks and responsibilities. In the interests of maintaining autonomy and boundaries for the course of this relationship and beyond, it is important that the joint venture agreement is clear on what these rights and responsibilities are. 

If you are considering entering in to a joint venture arrangement, there are several things you should think about: 

  • Know your proposed partner: It is important to be confident in the reliability and capacity of your partner to contribute to the project as a joint venture can represent a significant investment.
  • Safeguard the interests of your own company: While you gather information on your partner, they will be doing the same by you. Provide information on a ‘need-to- know’ basis. Be clear on what information you do not want to disclose, or ensure that disclosure of sensitive information occurs later in the negotiation process, when you have established a relationship of trust.
  • Seek legal advice: At every stage of the negotiation process, you should consult with your legal adviser. This will help to minimize the risks through protection of information and will help you to understand your legal rights. 

Whether you need assistance through the negotiation stage of the joint venture or drafting a clear and fair joint venture agreement, the Avon Legal Business team is here to help.  It is well and truly worth spending money upfront to protect your long term interest.