Law in QLD - What happens if you die without a Will (and why you shouldn’t)?

If you die without a Will, you are said to have died ‘intestate’. If you die intestate, you don’t have a say over what happens with your estate assets when you pass away.

What are the rules of intestacy?
Certain default rules of succession apply to the estates of those who die intestate (without a Will). As represented below, estate assets will go to the spouse and ‘issue’ (biological children and/or grandchildren depending on who is living), and then in the absence of a spouse or issue, then onward to the parents of the deceased, and so on through to the outer rings. Ultimately, if you have no living relatives when you pass away, your estate assets may pass to the Crown (the Government).

Why you shouldn’t die without a Will:

No executor
Without a Will, you won’t have a validly appointed executor who can take care of the process/paperwork of dealing with your estate. Instead, a person or persons will need to apply to the Court to be appointed as your administrator. There is a default hierarchy as to who the administrator would usually be (a person lower on the list would need to give reasons why they should act instead of someone higher on the list).

No say on how your estate assets are shared/distributed
When you don’t have a Will, you don’t get a choice who receives your estate assets. So, if you’d rather distribute your assets in a way that doesn’t follow the default intestacy rules, such as choosing a brother or sister to inherit your belongings instead of a parent, you should make a Will to provide for this.

Increased stress for your loved ones
When someone passes away it is already an emotional time, and not having a Will can amplify this stress. If you have a Will, the process can run more smoothly, and your loved ones will have one less thing to worry about.

Leaving your children without an appointed guardian
If you have children (or are potentially planning to have them), you can appoint a guardian or guardians in your Will. Naturally, there are other (sometimes very costly) court processes which can assist in resolving who is to be the guardian of your children if you don’t have a Will (or fail to appoint a guardian in your Will). However, exercising a conscious choice in respect of a suitable guardian seems the preferable (and certainly more thoughtful) approach.

More costly administration costs (generally)
Having a valid Will can reduce the financial cost of administration of your estate as, in most cases, there is already an executor appointed (avoiding the need to apply to the Court to appoint an administrator) and a distribution detailed in the wording of the Will. Unless the Will is challenged, this distribution (who gets what) is generally followed.

Foxlaw can assist with Wills and estate planning (the other things you need to take care of besides the Will document itself). We can also prepare Enduring Powers of Attorney. Organising your estate planning ahead of time ensures you don’t add unnecessary pressure on your loved ones at an already difficult time. Hope for the best, but plan for the worst!

Special thanks to Jemma McKenzie (law student) for her assistance with this article!

Preparing your Business for Sale in QLD

Selling your business is an important decision.  It is important you have all the information you need when you decide to sell.  Below are some things you might consider as part of your pre-sale preparation:

1.   Method of Sale

There are two main methods of sale. First is the sale of the business assets themselves (most common), which often (but not always) uses a standard form REIQ Business Sale Contract.  Second is the sale of the seller’s interest in its entity, for example, the sale of the seller’s shares in its company or the sale of the seller’s units in a unit trust.

2.   Due Diligence (Seller – looking at the Buyer)

As the seller, you may assess the likelihood of a prospective buyer obtaining finance to purchase your business.  It might also be wise to consider whether you need to seek out a buyer with a certain level of financial standing and with experience in running a similar business, as your landlord may have certain requirements that the buyer (as a new tenant) must meet. 

3.   Confidentiality Agreement/NDA (Non-Disclosure Agreement)

A prospective buyer may request sensitive/confidential information about your business, so you may wish to review this information with your solicitor and/or accountant before giving a buyer access.  It is often a good idea to have the prospective buyer sign an agreement to better protect your confidential information.

4.   Structure of the Deal

Is the deal plus stock (with a stocktake) or inclusive of any stock (a.k.a. ‘walk in walk out’)?  Have you considered the GST status and is it capable of being a sale of “Going Concern”?  You should seek professional legal and accounting advice, but to oversimplify, to be a “Going Concern” both parties must be GST registered (or required to be), and you as the seller must supply all of the things necessary for the continued operation of the enterprise/business.

5.   Your Lease

Consider whether there are any outstanding ‘make good’ or ‘refurbishment’ provisions.  Is the ‘Term’ of your Lease current (or are you now, for example, a periodic month-to-month tenant)?  Is there an unexercised option (that perhaps should be exercised)?  Should the lease be registered on the title?  Having a pre-sale lease ‘check-up’ is a great idea, as lease issues can really affect the sale process and ultimate outcome.

6.   Plant and Equipment

What condition is your plant and equipment in?  You may need special conditions in the Contract to account for this.  Is the plant and equipment ‘unencumbered’ (fully owned by you)?  Consider whether any loan/finance needs to be paid out or whether the buyer is willing (and able) to assume liability and step into your shoes.

7.   Intellectual Property

Consider the goodwill assets of your business and intellectual property (for example, registered business names, domain names, phone numbers, trade marks, patents, etc).  A useful first step is to ensure that any registrations have not lapsed/expired.

8.   Due Diligence (Buyer – looking at the Seller)

Consider what the Buyer will want to look at. They may wish to see financial records (for example, a Profit & Loss Statement and Balance Sheet [typically the past 24-36 months]), budgets and business plans, details of your accounting and other systems (for example, Xero, MYOB, CRM software, automation software, etc).  Other information which may be useful might include utility accounts, supplier/customer details and insurance particulars.  If you have been trading relying on any verbal/‘handshake’ agreements, it might be a good idea to reduce those to writing and consider whether the buyer will be able to continue to benefit from those arrangements (or not).

9.   Employee Entitlements

What is currently owing to your employees?  Up-to-date information will need to be available so entitlements may be adjusted at settlement (if adjustment is agreed upon).  What documentation is currently in place with employees?  This includes employment contracts, policies, etc.

10.   Restraint of Trade

A buyer paying for ‘goodwill’ will often want the seller restrained from opening up a new business in competition to the buyer, for a period of time after the sale.  An example of this might be a 25-kilometre radius (area restraint) for three years (time restraint).  As a seller, consider what you are willing to offer.  If you offer a more generous restraint, will it increase the ‘goodwill’ the buyer will pay for and therefore the overall price of your business?  Do you need any ‘carve outs’ for activities you intend to continue after the sale completes which should not breach the restraint?

Got more questions on selling (or buying) a business?  Feel free to contact us on (07) 49 278 374 or email us at teamfox@foxlaw.com.au!

Choosing a Conveyancing Solicitor in QLD

Conveyancing is the process of transferring the legal title of a property from one person/entity to another.  Commonly, this process is experienced when buying or selling a home.

Many think the process is simple/straightforward/easy.  It can, however, be pretty involved with so many moving parts.  Having a great solicitor (and supporting conveyancing team) to guide you through the many steps can make all the difference!  This guidance takes a lot (if not all) of the stress out of any challenges/difficulties which may pop up along the way.  It really can help turn any frown up-side-down! J   

Below are 5 key considerations when choosing the 'right' conveyancing solicitor for you:

1. Level of Service and Reputation

Gauge how friendly and helpful they're likely to be.  The first phone call (or email exchange) will often tell you quite a lot.  Seek out the advice of family/friends/trusted advisors etc.  Visit their website.  Check out available testimonials and/or internet/social media reviews (but form your own opinions and take these reviews with a grain of salt).

2. Personality
The conveyancing process can involve a lot of personal interaction, so choose someone you feel you have a good connection/rapport with.  Ideally, seek out someone with technical knowledge and expertise, but someone who also has other positive traits you appreciate in other human beings.  Lawyers are humans after all!   

3. Reliability
Being able to contact and speak with your solicitor (and the supporting conveyancing team) throughout your conveyance is very important.  Technology now allows for the convenience of messaging and emails, but if a problem needs to be dealt with, you will likely appreciate the ability to speak directly over the phone and/or meet up face-to-face.

4. Focus on, and experience in, Property Law
Even though solicitors are qualified to practise across many areas of law, commonly they choose to focus on a small number of areas.  Choosing a solicitor who has a specific focus on property law will mean you are getting the best advice every step of the way and dealing with someone who stays ‘sharp’ by spending ongoing time ‘in the trenches’. 

5. Cost
Ask your solicitor how they charge.  See if they offer a fixed-fee.  If they do, ask for a quote up-front.  Don’t be afraid to ask these questions and be sure to find out what the quote includes.  Make sure you are aware of any additional costs, such as stamp duty, registration fees and search costs.  When comparing quotes, ensure you’re comparing apples with apples!

We’re always happy to chat!  Call (07) 49 278 374 or email TEAMFOX at teamfox@foxlaw.com.au !!!