Canterbury Tales - New Zealand Law Society

Canterbury tales
Canterbury tales
Canterbury Westland Branch New Zealand Law Society
October 2014, Vol. 20, No. 9
Stars in our midst
By Judge Rob Murfitt
It was in the 2014 Christchurch Jazz
Festival that Miranda Rout came out
of retirement and assumed her
place among other professional
performers in the city.
She, supported by another talent from the Bar,
Dave Goldwater who was superb on guitar,
presented a range of songs at the Christchurch
Jazz School theatre on High Street.
Others in the backing group were Mike Kime
on bass, Barry Brinson on the keyboards and
Ted Meager on drums.
Miranda has had a long history in performance,
having moved to the UK as a teenager, intent
on a career as an opera singer. In the somewhat
colourful world of theatre and concert venues,
she carved her first career in classical genres,
opera and jazz before returning to New Zealand
to marriage, children and the law.
Since then her well-developed voice has
become ripe for jazz and blues, her first love in
music, and her speciality. She has such a black
voice for a white woman and her smokey tones
have all the timbre of Nina Simone, Anita Baker
or Ella Fitzgerald.
Her gutsy rendition of I’d Rather Go Blind,
originally by Etta James, blew this reviewer and
the audience away. Miranda’s repertoire
included other covers of numbers by Tom
Waite, Stevie Wonder, Billie Holliday as well as
her own composition, Long Road.
In every offering, she displayed an extensive
tonal range, providing her own inimitable
interpretation of well-known jazz standards and
digging into her diverse musical background
to provide a sultry and soulful sound. Here is a
singer who provides a rich and authentic voice,
mirroring the sentiments of both covers and
original material.
Since the Jazz Festival, Miranda has performed
Miranda Rout performing at the Law Dinner in August.
for her legal peers at an inter-bench judges’
dinner in May and at the Bar Dinner held on
15th August to celebrate the career of Justice
Graham Panckhurst.
There she serenaded the retiring judge with a
personalised variation of Etta James’ number
aimed to persuade him to change his mind or
at least let him leave in no doubt of his standing
in the mind of the lawyers of Christchurch.
Judging by the warmth of the embraces which
followed, Justice Panckhurst and his wife Jill
obviously appreciated the gesture.
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Vino Fino
Photo Caption
Each month we have a photo caption
competition where we invite you to submit a
caption. The winner will receive two bottles of
wine sponsored by Vino Fino (www.vinifinoco.nz,
188 Durham Street).
Send your entry to the Canterbury Westland
Branch New Zealand Law Society, P. O. Box
565, Christchurch. Or email to [email protected]. All entries must be
received by November 9 2014. The winner will
be announced in the next edition of Canterbury
Tales.
President’s Column
Dear Colleagues,
It was my pleasure to write to the Honourable
Amy Adams on your behalf to congratulate her
upon her appointment to be both the Minister
of Justice and Minister of Courts.
Amy graduated from the University of
Canterbury in 1992 with LLB (Hons) and was
admitted in 1993. She commenced working for
Arthur Watson Savage at Invercargill before
returning to Christchurch to work for Malley &
Co in 1994.
In 1996 Amy worked with Duncan Cotterill
before moving to Simon Mortlock & Partners in
2000. She was appointed an associate in 2001
and a partner of that firm in 2004. Amy made a
significant contribution to the profession in
Canterbury before entering Parliament in 2008.
As a profession we look forward to working well
with her in these new roles.
While on things political, the last elections were
a defining moment for the media. For many
weeks we were invited to sit on the edge of our
seats as the breath-taking events of each day
were portrayed endlessly before us.
To add to this circus of colour was the
commentary often youthful but not necessarily
fully informed. This was also delivered in excited,
often dramatic tones explaining the impact of
the day’s events resulting in the shattering of
our comfortable thoughts of certainty for the
future.
Well it turned out that New Zealanders actually
have minds of their own and are not as easily
excited as the media might suppose. After days
of mostly nonsense (some say) we had an
interesting election result, probably sensible and
without the circus act that sometimes follows. I
say the political media machine deserves a good
long holiday.
Local Awards
The winning entry for last month’s picture
(below) was:
“What, play my guitar in the final
submission, do you think that
would work?”
Both the following gentlemen receive awards
for talents yet to be properly exploited.
Michael O’Regan — Michael is a man of
significant musical ability. Michael comes from
a family that also has (it’s not surprising) a
significant musical background. His father for a
number of years used to drive a Mr Whippy van
and his mother was well known for her ability
to play several snappy tunes on the family farfisa
organ.
Unfortunately Michael’s cello has remained
untouched for many years. This man needs a
lot of encouragement to open the case and get
playing again. I urge you to dig up a gig and get
this man producing the beautiful music he is
capable of.
Tony Greig – The background to this award
occurred in the following way. Mrs Angela Grant,
who as many know spends all available time
profitably, was reading another of her “lite”
romances. These generally are revealed by what
is on the front cover where people are pictured
wearing glamorous but impracticable clothing.
Mr Greig happened to be present in a waiting
room during one of these “reading sessions”
and having glanced at the cover of the novel
pronounced in his authoritative English voice,
“I could write something better than that”.
Those present all agreed that this gentleman
would be able to write a ripper of a tale. Even
if the book had the simple title Memoirs, it
would be certain to be a best seller. Please
urge him to get on with this task.
Until next time.
Colin Eason
Canterbury tales
Taking a plunge for charity
On Friday 10 October 2014
three teams from Wynn Williams’
Christchurch Office took to the
Heart Stopper Challenge ice
baths for five minutes to raise
money for Heart Kids NZ.
Plungers from all areas in the firm took part
and helped to raise more than $10,000 for
the charity.
The firm took the prize for the most money
raised and Jared Ormsby, Executive Chair, took
the prize for the best individual fund-raising
effort. He raised a mighty $2138 as part of his
teams $5459.80 effort. Thank you to everyone
who sponsored this very worthy cause.
The firm has partnered with Heart Kids NZ for
the last year and offers ongoing financial
support and the provision of pro bono legal
services on a national and regional level.
Heart Kids NZ is the only NZ charity that
supports the children and families of children
who suffer from congenital heart disease. Every
week in New Zealand, 12 babies are born with
congenital heart defects.
Each year about 450 open heart surgeries are
performed on children — some of these are
on babies in their first days of life. These little
fighters face Heart Stopping Challenges.
During surgery a child’s chest cavity can be filled
with an icy slush to slow the heart’s oxygen
requirement, giving the surgeon a longer
window of operating time.
The Heart Stopper Challenge celebrates these
brave children, and aims to spread awareness
and provide lifelong support for those who
battle congenital heart defects.
Canterbury Tales is the official newsletter of
the Canterbury Westland Branch New Zealand
Law Society.
Publications Committee: Karen Feltham
(editor), Brendan Callaghan, Aliza Eveleigh,
Zylpha Kovacs and Kate Dougherty.
All correspondence and photographs should
be forwarded to: The Branch Manager,
Canterbury-Westland Branch New Zealand
Law Society, Unit 1, 8 Homersham Place,
Russley, Christchurch. P. O. Box 565
Christchurch.
Phone 358-3147, fax 358-3148. email
[email protected].
Canterbury Tales is published 11 times per
year. The deadline for editorial and
photographs is the 8th of the month.
Disclaimer: Canterbury Tales is published by
the Canterbury Westland Branch New Zealand
Law Society. The opinions expressed herein
may not necessarily be those of the Branch
and have not been expressly authorised. The
Branch accepts no responsibility whatsoever
for any error, omission or statement.
Jared Ormsby with one of organisers of the Heart Stopper Challenge.
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Untied from the timesheet — Final
Getting life’s balance right
By Andrew Nuttall
Director, Bradley Nuttall Ltd
Phone 364-9119
Of the people you know, who
do you consider to be the
most successful? Who do you
believe is the happiest?
Have you named the same person in answer
to both these questions? If not, this may
encourage some discussion in terms of what
success and happiness look like for you, and
how you might want your life to look.
In 2013 I interviewed 22 people who are
closely involved with the legal community,
including senior and junior partners, executives,
and other practitioners. I have written a White
Paper to address some of the key findings of
my research.
I identified some of the main challenges facing
law firms to be the partnership model,
succession, generational differences and skills
shortage, client expectations, technology, firm
valuations, and high stress levels.
In addition, a number of the people I
interviewed mentioned that while lawyers
typically earn incomes well above the national
average, many do not achieve the financial
security that they should. My research identified
two key reasons:
1. The plumber’s leaky tap.
“Finding the time to balance work and family,
so it stays on track, is the biggest challenge.”
“I spend so much time at work and what time
I have left needs to be devoted to my wife and
children.”
“The last thing I feel like doing at 9pm is dealing
with all our own financial stuff.”
“For many of us, spending time planning our
summer holidays seems more important than
planning how to finance them, let alone
developing strategies to fund holidays in
retirement.”
2. Keeping up with the Joneses
Many lawyers reported that they feel pressure
to maintain their image:
“I work hard, I am smart, and I deserve these
things.”
“My business partners look like this and I need
to do the same.”
In my White Paper, I outlined some solutions
for solving the financial challenges. Further
research has indicated that 95% of lawyers
have not sought an independent review of
their finances, while 100% of those lawyers
thought it would be a good idea.
At Bradley Nuttall we offer a no-obligation
opportunity for you to spend up to 90 minutes
meeting with an adviser to receive a second
opinion on your finances, and an independent
review. During this meeting we can determine
where you are now, where you would like to
be, and help identify any gaps on the road to
getting there.
During this process, one of three things might
occur:
1. We will confirm that you are on course and
that you should just keep doing what you are
doing.
2. There may be some things that require
follow-up. If we are not the people to assist,
we will be able to point you in the right direction.
3. If we identify some things that we are able
to help with, we can explore these further at
another time.
If you would like to take up this opportunity,
please email me in confidence. My email
address is [email protected].
A copy of my White Paper has been posted
from the Law Society to each firm. If you would
like a copy for yourself, please feel free to
contact me.
Andrew Nuttall is an Authorised Financial
Adviser at Bradley Nuttall Limited. Readers
should be aware that this article is of a
general nature and not personal advice.
His Disclosure Statement is available on
request and is free of charge.
Comings & Goings
Joined firm/organisation
Change of status
Sonya de Vries (Williams McKenzie), Katherine
Forward (Duncan Cotterill), Jacqueline
Frampton (White Fox Jones), James Hay
(Central Plains Water Limited), Tammy Henry
Solanki (Wynn Williams), Evelyn James (LINZ),
Chloe Jolliffe (Anthony Harper), Sarah Lester
(Chapman Tripp), Josephine Lewis (MWH New
Zealand), Nina Mackay (Aoraki Legal Limited),
Liping Qin (Davidson Legal), Alice Ruddenklau
(MWH New Zealand Ltd).
Jeanette Mehrtens, partner Helmore Stewart.
Peter O’Dea, partner Helmore Ayers.
Julia McKeown (Lane Neave to Wynn Williams),
Jane Yee (Malley & Co to White Fox & Jones),
Jacqueline Watson (Gresson Dorman & Co to
Tavendale & Partners, Ashburton).
Change of detail
Moved
New barrister/firm/organisation
Kathryn Lawry, sole practitioner, PO Box 79052,
Avonhead, Christchurch 8446, phone (03)
342-8293, fax (03) 342-8294 (previously with
Williams McKenzie).
Firm merger
Cooney Silva Evatt have merged with Tavendale
and Partners (Tancred Street, Ashburton
Branch).
Helmore Bowron & Scott, change of name to
Helmore Stewart.
Robert Perry, barrister, PO Box 29040,
Christchurch 8540.
Siobhan McNulty, barrister, phone number (03)
365-9277.
Strategy Law & Mediation Limited, PO Box
33367, Christchurch 8244.
Roz Burnside Law, phone 021 722 940.
Correction
The song Miranda Rout sang to honour Justice
Graham Panckhurst at the Law Dinner in August
was I’d Rather Go Blind, not Cry me a River,
as reported in last month’s Canterbury Tales.
The error is regretted.
Canterbury tales
Case summaries (76)
Avonside Holdings Ltd v Southern
Response Earthquake Services Ltd,
Court of Appeal, 1 October 2014,
[2014] NZCA 483
INSURANCE
Partially successful appeal against HC decision
determining whether, and to what extent, an
allowance for contingencies, the costs of
professional fees and the cost of replacing
external works should be included in the
calculation of the cost of rebuilding - appellant
owned a rental property (the Property) that was
insured by AMI Insurance Ltd (AMI) - AMI’s
liability under the insurance policy (the Policy)
had been assumed by respondent - as a result
of the Christchurch earthquakes of 4 September
2010 and 22 February 2011, the Property was
damaged beyond economic repair - Earthquake
Commission (EQC) paid appellant the
ma ximum amount payable under the
Earthquake Commission Act 1993 after each
event (total of $230,000) - land the Property
was on had been red zoned and appellant had
accepted the Canterbury Earthquake Recovery
Authority’s option of selling the land to the Crown
- appellant elected under the Policy to buy
another house - respondent’s liability was for
the excess over the amount paid to appellant
by EQC - at issue was the manner in which the
core “What we will pay” provisions of the Policy
were interpreted as prescribing the amount
respondent was required to pay appellant - a
notional exercise was required to be carried out
to determine that amount - clause (c)(ii) of
“What we will pay” stated respondent would “pay
the cost of buying another house, including
necessary legal and associated fees. This cost
must not be greater than rebuilding your rental
house on its present site” - CA said that “safe
ground” cannot be assumed - where the
Building Code has changed or where there is a
different assessment of ground risks that would
need to be addressed if the Property were to
be rebuilt on the existing site, those costs are
properly within the cost of rebuilding - CA noted
similar approach to the notional exercise taken
in Turvey Trustee Ltd v Southern Response
Earthquake Services Ltd. HELD: cost of rebuilding
the rental house on its present site involved both
the full replacement cost and additional costs,
encompassing contingencies and professional
fees - that was the amount the insurer would
be liable for where the insured chose the “to
rebuild on the same site” option and therefore
it was an amount equivalent to the sum both of
replacement and additional costs, and not the
lesser amount of solely “the full replacement
cost”, that was to be paid by the insurer to the
insured when the insured elected the “to buy
another house” option - if the Policy had
intended any limit to the full replacement cost
to apply in clause (c)(ii), it would have said so irrelevant in the present context that rebuilding
would not take place - what was required was
an assessment of the costs that would be
incurred if rebuilding were actually to occur costs could not be excluded merely because
the rebuild was not going to happen and costs
would not be incurred - a reasonable estimate
for professional fees and contingencies
prepared on the basis the Property was actually
being rebuilt on the site should be included costs payable as part of the required notional
exercise was the cost that would actually be
incurred to rebuild the house on the existing
site - items such as contingencies and
professional fees could not be excluded on the
basis that they would not, in fact, be incurred
because it was a notional cost that was being
calculated - cap on respondent’s liability was
the full replacement cost approach to rebuilding
the Property - if in that rebuilding process an
“as new” property could be produced by
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New Zealand’s legal research tool
repairing or reinstating external works rather
than rebuilding those items from new, then
that is the way the cap should be calculated where an insured chose the option of buying
another house, a lesser benefit would be
received in respect of external works that could
be repaired and reinstated - fact that, as a
matter of practicability, the option of rebuilding
on the site was not available to appellant did
not call for a different interpretation of the
Policy - appeal allowed in part - respondent
to pay contingency and professional fees
determined by appellant’s quantity surveyor decision of the High Court on the allowance
for external works confirmed - in terms of
financial outcome the balance of success
favoured appellant by a significant margin and
appellant therefore entitled to costs for a
standard appeal on a band A basis and
reasonable disbursements.
A heartfelt thanks
Lawyers sometimes get bad publicity for being standoffish. To be honest, sometimes it is deserved
although in their collective defence sometimes the pressures of the job often do not bring out
the best in people. I would like to come to their defence more generally.
As many of you might know just over a year ago I suffered what can only be described as a
traumatic car accident. My injuries were severe. I was in a coma for eight days and in hospital for
three months.
It was an extremely difficult time for my family and me. I am now back at work although currently
only two mornings a week.
Throughout this horrible experience I have been warmed by the goodwill shown to me by many
in the local legal fraternity. From visits in hospitals, to good cheer on the street, to countless calls
and emails, I have been moved by the feeling of interest and concern.
Many of the lawyers (and judges) who have been so good to me I previously only had a professional
relationship with. As an example, one lawyer had a lovely chat with me outside my place of
employment one morning. We followed that up with a nice lunch. I am proud to now call this
particular lawyer a friend.
My employer and work-mates at the Public Defence Service in Christchurch have also been
terrific — regularly visiting me in hospital and being so supportive of me, my wife (who works at
Duncan Cotterill) and our two-year-old daughter Evie.
This, of course, has meant the world to me. Duncan Cotterill has also been fantastic, offering
plenty of ongoing support and understanding.
At the moment I do not go to Court much. Yet when I do I think about the cards and good wishes
that were delivered to me when I so desperately needed it from not only lawyers but also the
wider legal fraternity. Without trying to sound mushy, it warms my heart and I will forever be
grateful.
We live in an environment that often does not appreciate the good. I try to. While I may have
heard one too many bad lawyer jokes, I will never forget what the profession has done for my
family and me. I can only say again thank you to all and sundry for the support. I am, as always,
proud to be a member of Canterbury’s legal fraternity. — Todd Nicholls
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Junior Practitioners, left, square off against their seniors in the annual comedy debate. Between them is the moderator Judge Raoul Neave.
Chch’s merits debated
By Sarah Hoffman
The Junior Practitioners’ Committee
followed up the sold-out BYO
dinner with the annual comedy
debate in September.
A team of young lawyers faced off against their
seniors, debating whether Christchurch is
“worth it”.
The junior team took the position that
Christchurch most definitely is worth it for
lawyers, whereas the seniors said we would
be better off elsewhere (perhaps due to a
concern that if we stay in Christchurch, we’ll
take their jobs!).
The junior team, led by Amy Keir of Young
Hunter, kicked off the debate with witty banter
and sophisticated analysis about Christchurch’s
unique character.
She was followed by the cutting repartee of
Sarah Hoffman and Guy Carter of Wynn
Williams, who rose above the ad hominem
attacks of the senior team to advance
arguments about the benefits of practising in
Christchurch, including the opportunities to be
involved in novel litigation, the venerable
profession from whom we can learn, and the
excitement of living in a city in a state of
transition.
The senior team, comprised of Kathryn Dalziel,
Kerry Cook and Jonathan Eaton, opined that
we would be better off in Wellington, the
provinces, or even overseas. However, their
arguments were rejected by the audience, who
voted with their applause to award the debate
to the junior team (for the second year in a
row).
The JPs Committee would particularly like to
thank Judge Raoul Neave, who moderated the
debate with his trademark panache.
The JPs also recently launched “Bridging the
Gap”, in par tnership with Lawsoc and
sponsored by IPLS. This is a mentoring program
that pairs young lawyers with law students in
their final year of study to provide support and
guidance.
Around 40 law students have signed up, and
the supply of keen mentors actually exceeded
this demand.
The next event coming up is the JPs Mystery
Wine Tour on 1 November 2014. This event
usually sells out, so we encourage people to
register as soon as possible!
Finally, the entire profession can look forward
to the NZLS Canterbury Branch Christmas
function on Friday 21 November, which is being
organised by the JPs Committee.
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The problem with being busy
By Julia Batchelor-Smith
Senior associate
Minter Ellison Rudd Watts
Why is everyone so busy these
days?
It seems to me that ‘busy’ is the most overused
(and misunderstood) adjective to describe our
welfare. You hear it bandied about equally
frequently in a professional and personal
context.
We’re busy at work. We’re busy at home. We’re
busy trying to balance work and home. And
most disconcertingly of all, even if we’re not
actually that busy, we feel compelled to say
that we are anyway.
But there’s an inherent problem with busyness.
When you break it down, being busy is not a
good thing. The physical state of being busy is
pernicious: it’s exhausting, unsustainable long
term, and ineffective. But the problems don’t
stop there.
There’s also an issue with the phenomenon of
‘busy bragging’: the act of complaining about
how busy we are to make ourselves feel better
(and often, to make others feel worse).
So what’s the problem with bemoaning our
busyness? When someone asks if you’re busy,
why do you feel compelled to respond: “I’m
absolutely slammed”, (even if you’re not)? The
fundamental issue with glorifying busyness is
that it indulges our insecurities and is
detrimental to our relationships with others.
Often, we boast about how busy we are
because we subconsciously want to feel more
important, more in demand and, more
successful than the enquiring person. We feel
the need to impress them with our seemingly
insurmountable workload. We have an urge to
play up our commitments to make ourselves
appear more impressive. And sometimes, we
worry that if we give an honest answer, people
might think less of us.
In my book, being busy is neither impressive
nor something to aspire to. The people that I
admire are those that are refreshingly honest
about (and do their best to efficiently navigate)
the challenges that life throws at them. They
don’t aim to be perceived as ‘busy’, they strive
to be viewed as effective.
Perhaps it’s time for us to reframe ‘busy’ as a
negative rather than a positive response. The
next time someone asks you whether you’re
busy, pause, stop, and consider your underlying
motivation before you respond. Are you giving
them an answer that you consider socially
acceptable, even if it’s untrue? If so, that’s a
problem in the long run.
Like it or not, being untruthful (even in a
seemingly insignificant way) compromises your
credibility. If you loudly complain about how
frantic you are and then take a lunch break, for
example, you may wind up irritating others. It’s
seen as inconsistent behaviour - and that in
turn may negatively cloud others’ perceptions
of you. And that should be reason enough to
resist the temptation to busy brag.
But it’s not just saying we’re busy that’s the
problem, being busy is a real issue, too. We’re
so culturally immune to the problem with
busyness that we’ve conditioned ourselves to
think it’s a positive thing. We think that just
because we can fill every second of the day,
we should. We think that being busy is being
diligent. But in reality being busy just means
being plain stressed.
Being busy is not sustainable. What’s more, it
can lead to you neglecting important parts of
your life. If you’re so overwhelmed that you
can’t return friends’ phone calls, or see family,
then it’s time to take a step back and evaluate
your time management. Are you really being
effective in the way you deploy your time and
effort? It may be that you’ve lost sight of what’s
important (and that a re-evaluation is in order).
To reduce your busyness and increase your
effectiveness, keep the following in mind:
* It’s important to have a daily plan: effective
time management starts with a plan. Make sure
you know what you need to achieve on any
day and tick each task off on a to-do list. Move
any tasks that haven’t been (or cannot
realistically be) achieved to the following day’s
plan. It’s vital that you prioritise what’s important
to you on a daily basis. And in the words of
time management guru Robyn Pearce,
continually ask yourself whether what you are
doing is the most important and pressing thing
you could be doing, right now.
* Strive to be strategic with your efforts: there’s
no point merely being busy with a particular
activity if it’s not genuinely important to you in
the long run. Adopt a big-picture approach and
be strategic with your efforts. If you fill your
days by inefficiently using your time, or devoting
it to tasks that truly aren’t necessary, you’ll end
up neglecting the areas of your life that are in
fact important. Direct your energy to the things
that really matter, both professionally and
personally.
* Ensure you focus on you, not others:
comparing yourself to others is the oldest recipe
in the book for complete disaster. Unfortunately,
it’s human nature. With that in mind, it’s vital
you make a concerted effort to refrain from
fixating on other people and the balls they have
in the air. Don’t allow yourself to indulge your
insecurities by using other people’s workloads
to make yourself feel inadequate. Instead, keep
the focus on you and your own personal
commitment to being the most effective and
productive person that you can be.
I think it’s high time we recognised that being
busy is not a good thing. We need to move
away from glorifying busyness and move
towards being productive, efficient, happy, and
fulfilled.
Because if that’s not worth striving for, it’s hard
to see what is.
This article was first
published in NZ Lawyer
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• Have they been provided with all of the costs?
• What other options are available to them?
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Tel: 027-295 4920
28
Canterbury
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Review of Law of Trusts
By Katrina Hawker
Director, Authorised Financial
Adviser, Accredited Investment
Fiduciary. www.accordia.co.nz
Many trust deeds and wills create
income and capital beneficiaries
who are entitled to funds from
separately sourced investment
returns.
Typically, a life tenant may be paid the income
and, on their death, the remainder men or final
beneficiaries are to be paid the capital.
Whilst these arrangements may have been
appropriate in the past, there are increasingly
significant problems that arise from the arbitrary
distinctions applying to returns. It can be difficult
to determine whether the return came from
one source or another, or both.
Whilst most investments have both an income
and a capital return/loss there are many other
factors that produce a rise or fall that does not
fit neatly into either category.
If the income is identifiable and paid out, how
do the trustees look after the capital beneficiary
when there’s a loss? If the costs are apportioned
between the two, the capital beneficiary is
further out of pocket when their portion of the
costs is added to their losses.
It is difficult to deal fairly with both sets of
beneficiaries, particularly over long time
horizons that need to accommodate inflation.
Low interest rates and even a low level of
inflation can result in lean pickings for the
income beneficiary.
An approach that targets the best overall total
return is likely to meet the needs of all
beneficiaries and is the approach favoured by
the New Zealand Law Commission, as
described in their recent Review of the Law of
Trusts.
“If trustees must invest with a view to
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balancing the capital and income returns,
both categories of beneficiaries are likely
to be dissatisfied because neither will
benefit from an optimal rate of return,” says
the Review.
“Where trusts have income beneficiaries the
traditional capital and income allocation
rules stand in the way of trustees
maximising the total return on investment.
“A key principle of modern day portfolio
investment theory is that it is artificial to
distinguish between capital and income
when investing. Instead modern portfolio
management assesses investment options
based on their overall total return regardless
of whether it is correctly categorised as
capital or income. The key principle here is
that investment decision-making should be
separated from distributional issues.”
The Commission also appreciates the
importance of trustees supporting an income
beneficiary by having enough discretion when
making distributions.
“To facilitate total return investment and
allow trustees to invest trust funds without
regard to whether the return on investment
is technically of an income or capital nature,
trustees should have discretion to determine
whether a return is to be treated as income
or capital for the purposes of distribution.”
“Trustees should ensure that a reasonable
level of income is made available for
income beneficiaries in situations where
there are defined classes of beneficiaries,”
states the Review.
An approach where the income beneficiary is
supported and the final beneficiaries receive
the real value of the capital is ideal. Markets
will move up and down in the normal way and
the trustees will review the distributions
regularly.
The total return approach used by most
professional investment managers is able to
accommodate the requirements of trustees in
these circumstances.
Modern vehicles (such as PIEs and Unit Trusts)
allow for significantly superior levels of
diversification, liquidity and tax efficiency
compared to holding direct bonds and shares.
The Law Commission recommends trustees
have authority to appoint investment managers
to make investment decisions. (The trustees
should exercise reasonable care, diligence and
skill of a prudent person of business when
doing so and review the manager’s
performance periodically.)
Adopting a total return approach may require
all beneficiaries to provide their written,
informed consent, particularly if the Trustees
are considering a different approach from the
one in the Deed or Will.
The Trustees should prepare a written
Investment Policy Statement, as the Law
Commission suggests, that sets out their
objectives and how they will oversee the
investment management process.
Important note. The discretion of trustees to
decide what is to be treated as income or capital
is for trust law purposes and does not in any
way alter or override tax law.
Words of wisdom
Sometimes, when I look at my children, I
say to myself, ‘Lillian, you should have
remained a virgin..’
— Lillian Carter (mother of Jimmy Carter)
I had a rose named after me and I was very
flattered. But I was not pleased to read the
description in the catalogue: — ‘No good in
a bed, but fine against a wall.’
— Eleanor Roosevelt
Last week, I stated this woman was the
ugliest woman I had ever seen. I have since
been visited by her sister, and now wish to
withdraw that statement..
— Mark Twain
The secret of a good sermon is to have a
good beginning and a good ending; and
to have the two as close together as
possible.
— George Burns
Santa Claus has the right idea. Visit people
only once a year.
— Victor Borge
Canterbury tales
7
‘distinction,
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now that this Court will no longer sit in North
Canterbury.
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That would be some way of reducing, at no
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included
in costs
search
expense
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Ministry,
the very real
that
have
been along
moved with
from all
the the
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on to
results,
familiar
practitioners
andloose-leaf
members of titles,
the public
alike.
LexisNexis
when
My learned friend has practised as a lawyer
you search across LexisNexis
not just before this Court but before almost
commentary
using
Library
every
jurisdiction in the land.
Cases conducted
bycomputers
him in the Rangiora
District
Court
have on
or WiFi.
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their
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Regardless of the defendants’ backgrounds, he
has given them all, in equal measure, the
benefit of his experience, the fruits of his
research, and the polish of his presentation.
If this sitting today has any positive purpose,
By Andrew Milligan
then it should be to mark the forthcoming
Many practices
the legal
profession
have
retirement
of Mrin Hales.
The
refreshments
been facingshould
a potential
demographic
crisis.
afterwards
be seen,
therefore,
notThe
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but as
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where retirement
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and they
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has served this community with distinction, with
The next generation should be lined up to take
dedication, with integrity, and with style.
their place but they often have different
On
behalf of the
but particularly
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aspirations.
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hours, wife
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May it please the Court.
Receivers of Companies in NZ by Blanchard
and Gedye; Statute Law in New Zealand by
John Burrows; and Williams and Kawharu on
Arbitration.
A complete list of eBooks available is on the
Library’s
website
at
http://
www.lawsociety.org.nz/law-library/librarydatabases/eBooks
LexisNexis training in Library
Learn the best techniques for searching
LexisNexis online by attending a training session
tailored to your needs. LexisNexis trainer Patricia
Buckley-Andre is offering short, focused sessions
for groups of 1-3 lawyers at a time. You have a
choice of a 20-minute individual session, or a
30-minute small group session (maximum three
people).
Training is to be held in the Library. Sessions are
available between midday and 3pm, Tuesday
11 November 2014. Book a session by emailing
[email protected].
New insurance titles
Keep an eye out for two forthcoming New
Zealand insurance titles: Colinvaux’s Law of
Canterbury tales
9
Insurance in New Zealand by Robert Merkin
& Chris Nicoll (Thomson Reuters) and
Insurance Contract Law in New Zealand by
Chris Boys & Duncan Webb (LexisNexis).
New books
Recent additions to the Library’s collection
include: Contractual indemnities by Wayne
Courtney, Hart Publishing (2014); Evidence Act
2006: Act and Analysis by Mahoney et al., 3rd
edition, Thomson Reuters (2014); Interpreting
Principles of Equity: the WA Lee Lectures
2000-2013, Malcolm Cope ed., Federation
Press (2014); Introduction to advocacy,
revised edition, Sir Bruce Robertson Editor-inChief, NZLS (2014); Justice in tribunals by JRS
Forbes, Federation Press, 4th edition (2014);
Youth justice in Aotearoa New Zealand: law,
policy and critique by Alison Cleland and
Khylee Quince, LexisNexis (2014).
See the “New titles” tab on the Library’s
catalogue to find more titles recently ordered or
added to the Law Society Library collection
nationally.
Contact Library
For further information or for any research or
document delivery requests, email
[email protected] or phone 377
1852.
How much is your practice worth?
Compass
Who will buy
your business?
Do you want to
grow your business?
What are the options available to a practitioner
who doesn’t have a successor in line? Sell the
practice to another legal firm; find a young
practitioner to sell too; employ a younger
practitioner who can take over the business
on your retirement and pay cash for the
business. (This might involve headhunting a
specific person); transition your business to
another firm, (whereby you would take on a
consultancy role and transition your clients to
the new firm over a period of time), payment
could be on date of merger or purchase over a
period of time, or payment could be based on
a higher share of fees than normal. This
arrangement could be virtually self financing.
Establishing Value: The most common
mythology used for valuing legal firms is usually
the Earnings Based Assessment or super profit.
This places an underlying emphasis on the
ability of the practice to generate future
earnings.
Historically when valuing legal firms a multiplier
was applied to the average of the last three
years net profit. The lower end uses a multiplier
of two and at the higher end a multiplier of
three. The super profit is the average earnings
less a market based salary for the working
owner.
The super profit times the multiplier becomes
the goodwill component. Due to taxation
considerations, work in progress is considered
as additional or included in or added to the
goodwill. Some firms hold two to four months
work in progress. (Often work in progress needs
to be discounted between 25% and 50%).
Once the total goodwill figure is arrived at we
then add on assets at book value if required.
This method of valuation will minimise the
taxation consequences and enhances the
goodwill figure which is not taxable.
One needs to take into consideration the
following issues when considering sale price.
It’s a buyer’s market. This is reflected in the
length of time it is taking for practices to sell. I
believe the market will further soften as more
“baby boomer” practices come on the market.
If you are continuing as a consultant in the
practice then there is a strong link between
the sale price and the salary that you will receive
in the future. There may be a trade off of a
higher sale price linked to a lower salary or a
lower sale price linked to a higher salary. An
issue for you would be the PI Insurance runoff if you chose to “close the door” which you
would be liable to pay over the next seven
years. This is normally your yearly premium for
the first year then reducing by 10% each year
following. You will need to check this with your
insurers.
The new purchaser taking over your practice
and files should also take over the run-off cover
or have it incorporated into their premium.
Valuing a business is not simply working out a
set formulae when determining value. A fair
market value for a business can be defined as
a price at which a buyer and seller can agree
taking into consideration all information
available to both parties.
You need to forward plan sometimes, looking
five to seven years ahead, so if you are
concerned about what will happen to your
business when you retire contact Andrew
Milligan Compass Solutions phone (03) 3581199.
2
10
Canterbury
Canterburytales
tales
Canterbury Westland
Branch/NZLS
Education
Programme
Proudly sponsored by
NZLS Continuing Legal Education
(CLE Limited)
To register and for other information
check the CLE website,
www.lawyerseducation.co.nz
Christchurch
November
4 — Trustees — meeting obligations and
minimising risk.
5 — Current issues in IT Law — managing
the cloud and lessons from Novopay and
Queensland Health, Webinar.
17 — Criminal Law — discharge without
conviction, Webinar.
18 — Expert witnesses from start to finish.
18 — Employment Law Pleadings, Webinar.
19-20 — Reading Accounts and Balance
Sheets.
24-25 — Introduction to High Court Civil
Litigation Skills.
25 — Employment Law Breakfast Seminar.
Watch for flyer.
25 — Property — dealing with caveats,
Webinar.
26 — Trust Account Supervisor Training
Programme.
27 — Mortgagee Sales, Webinar.
Out of Christchurch
6-8 November — Stepping Up —
foundation for practicing on own account,
Auckland.
10 November — Lawyer for the Child
Intensive, Wellington.
13 November — Mediation — how to
influence the outcome, Auckland.
11-12 and 18-19 November — Lawyer as
Negotiator, Wellington and Auckland.
21 November — Criminal Law Symposium,
Wellington.
Christchurch
Social
1 November — Junior Practitioners Winery
Tour.
7-9 November — Devils Own Golf,
Methven.
12 November — Quiz Evening. Watch for
flyer.
21 November — Christmas Bash.
Sound legal advice
Dr J Antonius Gill, litigation partner of Buttstun Quant LLP, answers
questions from those seeking to improve themselves as lawyers.
Dear Dr Gill,
I am having trouble recording 80 units of billable time per day. Can you advise me about how
to do this six days a week?
From A Disillusioned Lawyer
Dear Disillusioned Lawyer (a phrase which I consider to be oxymoronic),
Your problem is common although not one I have ever experienced.
For a start I express my surprise at the emaciated time-recording targets at your firm.
Perhaps you are working for a sole practitioner in a small country town? In any event,
recording 80 billable units per day is as easy as firing a recalcitrant paralegal:
1. You must arrive at the office early- very early. I recommend no later than 5am.
2. You must leave the office very late- many hours after dark.
3. You must work continuously during that time with a laser-like focus on accruing
billable time.
4. You must shackle yourself to your time recording device as if it is your life support.
5. Try little tricks to accrue billable time- take a file to the toilet, to your lunch break,
when meeting friends on the weekend (if you have friends which I advise against if you
are serious about achieving your goals). Take a file to bed. Place it in a position where
you can see it and carry out billable work, no matter what other activities you are
engaging in- if you receive my meaning. It’s amazing how these little chunks of time
can add up. I calculated that in the last financial year I billed £103,546 exclusively from
time spent sitting on the toilet and £1,238,322 while in various forms of interaction
(mostly unilateral) with my wife.
Above all, you must maintain a healthy philosophy. You must never forget that, if you
keep recording 80 units a day every day for the next 20 years, you might become a
partner, in which case you will have the opportunity to do the same thing for another
20 years thereafter.
Best of luck,
J Antonius Gill
Dear Mr Gill,
I don’t understand the law of torts. Can you help?
From A Confused Law Student
Dear Confused Law Student,
Please note that my name is Dr Gill, not Mr Gill. I see that you are writing from New
Zealand. You have virtually no need to understand the law of torts there, unless you
own a house that was poorly constructed less than 10 years ago. I would advise focusing
your attention on something carrying more credibility in the commercial arena, such
as the Securities Act or the Commerce Act. Their equivalents in my jurisdiction have
funded no less than five new houses/apartments in and around London and many
long vacations abroad for yours truly.
J Antonius Gill
J Antonius Gill is Global Managing Partner and Head of Litigation at the London-based firm
Buttstun Quant LLP — www.buttstunquant.com.
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PRINCIPAL
Canterbury tales
Practice Notice
We have relocated to the Christchurch CBD.
Our new premises, purpose designed as a barristers chambers, are located
at 184 Durham Street South, close to the new Justice Precinct now under
construction, where the High Court and District Court will be located.
Our contact details are:
Austin Forbes QC [email protected]
James Wilding
[email protected]
Kevin Clay
[email protected]
Tony Greig
[email protected]
(03) 379 7122
(03) 365 1255
(03) 365 0040
(03) 929 0026
To Lease
Situation Vacant
Accommodation
Available for short-term or overnight stays,
well-equipped one bedroom apartment
on a back section Highfield, Timaru. Close
to town centre, kitchen/living room with
wifi, Sky TV. Fully serviced, meals available
on request.
Call Karen (03) 688-6275 or txt 027
2286030 for further information.
Commercial / Personal Client Lawyer
We have the opportunity for an experienced solicitor with proven
property and commercial law experience to join our team. Ideally,
the right person will have at least five years or more PQE in the areas
of trusts, wills, estates, relationship property, general commercial
law and residential conveyancing, some clients of their own and the
ability to take over responsibility for part of our client base.
There are associate and/or partnership prospects for the right
person. The opportunity might also suit an existing partner or sole
practitioner looking for a more supportive environment with less
firm management and administrative responsibility.
Expressions of interest are invited and will be treated in confidence.
Please send your details and CV or telephone for a no obligation
initial discussion.
Bede Rolton, Rolton MacDuff, P O Box 25285, Christchurch 8144
E: [email protected] P: 03 377 8909 www.rolton-macduff.co.nz
Work Wanted
LOCUM AVAILABLE
All inquiries to
[email protected]
or 0274760215.
11
2
12
Canterbury
Canterburytales
tales
In-house lawyers get together
CLANZ (In-house lawyers Section) and the GLN (Government Legal
Network) hosted a function on Wednesday 27 August for Christchurch inhouse lawyers to get together with their colleagues.
With in-house practitioners spread all over Christchurch this was a great
opportunity to meet old friends and talk about the challenges of in-house
practice. Thanks to Anderson Lloyd for letting us use their new central city
offices as the venue for the night.
One of the night’s topics was the need to get access to relevant CPD
training. With many practitioners in small teams it can be hard to access
training. One of the solutions is to get together in study groups and some
are likely to be formed as a result of the evening.
Thanks to Rex of Vino Fino for a very informative wine tasting session. I
think everyone had their horizons expanded on the variety of new
overseas wines that are available.
A reminder to anyone who practices in-house, be it in the corporate world
or for a government organisation, CLANZ is your section of the Law
Society. We would love to see you at our next event. Get in touch at
[email protected].
Ian Hasell
CLANZ President
JOHN F BURN • MEDIATOR
LLB, AIAM A, ANZIM
ph 355 8079, mob 021 257 4629
email [email protected]
103 Rugby Street, Merivale, Christchurch
John Burn has returned to live permanently in Christchurch, having practised as a barrister sole here for
12 years, and latterly for 23 years at the Sydney Bar. He is available for mediations (not arbitrations) in
Christchurch and districts. John is an Associate of the Institute of Arbitrators and Mediators of Australia,
and was appointed as a mediator to the Supreme Court of New South Wales for some years. John is an
Associate of the New Zealand Institute of Management and was, for nine years, a Christchurch City Councillor.
He offers mediation in all classes of dispute for a fee to be negotiated with regard to the amount in issue.
Enquiries should be made to his address, where his terms of appointment and any further details are available.