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View Legal Magazine November 2014

Point of View

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View Team

Over View

The Legal View

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A View Point – Back of the Envelope

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The New View – Buy1GIVE1 (B1G1)

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Over View

Building the firm our friends would choose

Welcome to our second edition of Point of View.

It has been a great couple of months for the View team. Some of the highlights include:

1. Welcoming a new member to our team, Suzanne Thomasson

2. The release of our free estate planning app and directors’ duties app for both Apple and Android – check them out via our website at www.viewlegal.com.au

3. Our first seminar (as opposed to webinar) – about restructuring businesses for asset protection and succession Email us at mail@viewlegal.com.au for more details

4. We presented a number of webinars, with a particular focus on tax and estate planning and again these are all profiled on our website

5. The launch of our online store, to simplify the ordering process for our web based solutions — a special thank you to team members Naomi Arnold and Winnie Van for driving this project

6. Matthew and Patrick both traveling to Perth to present seminars for the Tax Institute of Australia and the Television Education Network

7. Matthew also visited Sydney on multiple occasions for seminar presentations on behalf of a number of organisations and Darwin for Legalwise and a financial planning firm

We hope you enjoy another information packed ‘Point of View’.

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“Reasonable men adapt themselves to the world. Unreasonable men adapt the world to themselves. That is why all progress

depends on unreasonable men.”

George Bernard Shaw

Back of the Envelope

Passion is often seen as the ‘secret ingredient’ that is the difference between success and failure. The age old saying that ‘if you can find a job that you love, you will never work a day in your life’, is often quoted by ultra successful people. The extent of the passion that drives many successful people is sometimes difficult to comprehend unless it is experienced firsthand. In the early 2000s, I was fortunate enough to work for a tourism operator named Ross, who had spent what ended up being the last 20 years of his career developing an extraordinary island eco tourism resort.

At various times, almost singlehandedly, he battled with governments of each persuasion and at local, state and federal levels. There were then the battles with impatient investors, family members that had different visions to his and financiers that had grown tired of, what they saw as, never ending delays. The project in many respects was all-consuming and, shortly before the resort was finally ready to open, the headaches that Ross had been experiencing for some months became so unbearable that he decided to go to his GP.

He completed the initial course of medication for what were thought to be severe migraines, but after two more weeks of increasing pain he went back to his GP who referred him for specialist help. Ross was sent to hospital for brain scans, at which point he was told that a brain tumour as big as a tennis ball had been discovered just behind his left eye.

Further tests and surgery were deemed useless. Ross had, at best, four weeks to live. While a cocktail of drugs would at least help manage the pain, they would also severely diminish his capacity, and with the project still at least 12 weeks from completion, he realised that he must assign a priority to every activity, knowing that whatever was not near the top of the list would simply never be done. He also knew that anything not addressed in the first couple of weeks following the diagnosis was also highly unlikely to be done, as the medication required to numb his pain would increase to levels that would make even getting out of bed virtually impossible.

Perhaps understandably, even for someone with such enormous passion for his life’s work, Ross essentially let go of the remaining steps of the project. Fortunately, he had surrounded himself with a management team and family members who understood his vision. He called a series of meetings in the 48 hours following the initial diagnosis but that was all the time he was willing to invest.

If you can find a job that you love, you will never work a day in your life.

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The priority list, as far as Ross was concerned, had been narrowed down to simply one item — to spend time with his family and friends — and over the next 10 days, as his health deteriorated even more rapidly than had been initially expected, that is exactly what he did.

Long days and even longer nights were filled with meals, stories, laughter and tears — all shared with those nearest to him. Within two weeks of the initial diagnosis, Ross was re-admitted to hospital and would not leave until his death.

At some point, around 36 hours before he passed away, at a time when the painkillers were at a level that left him barely conscious, a family friend asked Ross whether his executors knew where his will was stored.

For the past two weeks, his passion had dissipated, hour by hour until it appeared non-existent. Now, almost instantaneously, it re-turned.

No, the executors of Ross’ will did not know where the last will was because there was no last will. On two or three occasions over the years, Ross had started estate-planning exercises only to give them up as being useless because so many things were likely to change before he passed away.

We were immediately struck by the passion and energy in his voice.

Now, with nothing likely to change, he faced the serious prospect of his life’s work unravelling with a suite of legal fees and government rules. There would be family members left guessing, at best, and fighting bitterly, at worst, about what his intentions might be.

Using the back of an envelope retrieved from a nearby rubbish bin by his friend, and the pen normally attached to the clipboard at the end of his hospital bed, Ross sketched out the vision for his estate plan and asked his friend to arrange for his accountant to draft the necessary documents, so that he could review and sign them the following day.

The instructions on the back of the envelope were extraordinarily detailed (despite being set out on such a small piece of paper) and made logical sense, the task that I had been given, via Ross’ accountant was at best extremely difficult, and more realistically, completely impossible.

We put together base documentation and had it ready for review by the next morning as requested, but without an in-depth meeting with Ross and his accountant, it was likely that what we had produced would in fact be worse than not having any will at all.

At 9am the next morning, the accountant and I arrived at the hospital ward, and waited while the doctor on duty confirmed that Ross could in fact see visitors.

Ross’ wife and one of his sons explained to us that he was exceptionally weak, and while his mental capabilities seemed sound, the drugs had had such a severe impact that we should expect only a very short and extremely high level discussion.

When the doctor motioned to us to enter the room, his only comment was that, if possible, we should arrange to have all documentation signed immediately; in his opinion, Ross had only about 24 hours to live. As we entered the room, with Ross’ wife close behind, we were immediately struck by the passion and energy in his voice. Physically, he was as bad, possibly worse, than we expected, but his vocal demeanour was in complete contrast. For the next hour we vigorously debated every aspect of his vision, referring to a photocopy of his envelope summary that I had blown up onto an A3 size piece of paper.

The accountant and I left the room positive that the series of instructions we had been given captured all of his vision. I was thinking that if that if Ross could perform like that when he was near death, he must have been an extraordinary operator in full flight.

His wife must have read my mind. She had maintained complete composure throughout the hour long meeting, but now had trouble controlling her voice as tears streamed down her cheeks.

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‘It was as if nothing was wrong with him at all’, she repeated over and over again, as, nearly collapsing, she was helped by her son to a nearby chair. Four hours later, the accountant and I were back in the same hospital room with Ross.

Already physically depleted, his verbal and mental capacities were now rapidly fading. The energy, passion and strength that had so impressed us only a few hours earlier had almost completely disappeared.

His wife must have read my mind. She had maintained complete composure throughout the hour long meeting, but now had trouble controlling her voice as tears streamed down her cheeks.

In a meeting that lasted less than 10 minutes, we were barely able to walk through the headline components of the documentation before Ross began slipping in and out of consciousness.

While we managed to get all documentation signed, our strong sense on leaving the room was that we were most likely to be the last people to speak with him, and we were proved correct. Two hours later, Ross died. The passion with which had had been able to confirm his vision for his estate plan was at the time, and remains to this day, truly inspirational. Ross had understood and harnessed in the last moments of his life what I suspect he had harnessed so many times before — a concept captured in the words of the proverb:

Early to bed and early to rise makes a man wealthy, healthy and wise.

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View Team – Patrick Ellwood

Patrick Ellwood is a director and co-founder of View Legal, having previously spent eight years at a national law firm.

Patrick loves helping business owners plan for their future. He assists family-owned businesses ranging from large-scale retail operators to farming families and mining entrepreneurs. He is passionate about helping his clients grow their business and achieve maximum value for their hard work upon their retirement.

He is a strong advocate of the use of technology in the law, believing that technology can provide clients with faster, more affordable and more accurate legal documents and advice.

As is the case with all of our directors, Patrick is also a regular author and speaker across a range of private and professional bodies. He recently spoke at the Tax Institute’s 2014 National Convention in Hobart and the Television Education Network’s 2nd Annual Estate Planning Conference in Perth.

When he’s not at work, Patrick spends his time with his wife and daughter, travelling together to exotic locations and fitting in the occasional snow skiing holiday.

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The New View – Buy1GIVE1 (B1G1)

One of the first things we did on founding View Legal was to partner with Buy1GIVE1, an amazing organisation that assists businesses to give back to the community. Their core purpose is ‘to create a world that's full of giving by unleashing the power of small’.

Buy1GIVE1 (or B1G1 for short) was founded in 2007 when a group of business owners realised it was too difficult to give back effectively while running their own businesses.

The quote below from the B1G1 website summarises why we are passionate about our partnership with B1G1:

‘We do what we do because we believe that those small businesses, small everyday transactions and small individuals − every business owner, employee, customer and beneficiary impacted by the business giving − can change our world when we come together through the sense of giving and caring.’

In addition to our traditional legal solutions, we provide a number of web-based solutions via our website at http://viewlegal.com.au/online-services. With our involvement with B1G1, for every solution ordered through our website, a portion of the proceeds are used to give access to life-saving water to people around the world.

As part of our commitment to give back to our adviser network, we run a number of technical webinars throughout the year. For every registered attendee in each webinar, we give one day of educational support to a child in Cambodia.

While our contributions to date are a relatively small start, we are committed to B1G1 remaining a key part of our business. Ultimately embracing what B1G1 is all about – unleashing the power of small.

More information about B1G1 can be found at www.b1g1.com

All pictures from www.b1g1.com

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The images on this page and the previous page are taken from the Buy1Give1 website. The above figures are based

on the number of donations made by View Legal.

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The Legal View

Validity of wills

What is a valid will?

While the rules in each Australian state are different, generally, in order for a will to be valid, it must be signed by the testator and witnessed by two independent adult witnesses (over the age of 18 years).

Both witnesses must be present at the time when the testator signs, and also when they sign as witnesses.

If the testator is under a disability, such as a sight impairment, then the will must state that it was read aloud to the testator, and that the testator understood and approved of its contents. The witnesses to the will must not be beneficiaries, or be related, married or engaged to be married, to a beneficiary.

What can cause a will to become invalid?

If a will is made, and the testator subsequently marries, the marriage will revoke that will, unless the will states that it is made in contemplation of the marriage.

If a will is made while the testator is married, and subsequently a divorce takes place, this can affect the will.

In many Australian states, divorce will automatically invalidate the entire will, in so far as it benefits the former spouse, unless the will specifically provides that it is made in contemplation of the divorce.

In many Australian states, divorce will automatically invalidate the entire will, in so far as it benefits the former spouse, unless the will specifically provides that it is made in contemplation of the divorce.

Divorce and estate planning

The impact of a relationship breakdown on any estate plan must be considered carefully. While in many jurisdictions, a formal divorce leads to a partial revocation of an existing will, if the couple has only separated or, alternatively, if they have only had a property settlement, neither of these events impact on pre-existing wills.

Generally speaking, before a divorce takes place, there must be complete separation for 12 months following a breakdown of the relationship.

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On that basis, the conservative recommendation would always be to update wills and related documentation as soon as permanent separation takes place.

In most instances, particularly where the estate planning documents have been implemented in recent years, this process need neither be time consuming nor expensive.

The conservative recommendation would always be to update wills and related documentation as soon as permanent separation takes place.

What can cause a will to be valid but out of date?

A will is current if it takes into account all the present circumstances of the testator, such as marital status, whether there are any children, the age of those children and whether those children

need to be provided for in any particular or special way.

If the testator has recently become divorced, is marrying for the second time or their financial circumstances have altered, then the will is automatically out of date and should be updated.

It is important to consider the following factors that might cause a will to be out of date, namely whether:

(a) the people named in the will are still alive and using the same name

(b) the people appointed as guardians and executors are still appropriate

(c) the situations or needs of any of the beneficiaries have changed

(d) all the assets specifically mentioned in the will are still owned by the testator

(e) the tax laws have changed in a way that might affect the testator’s plans for the beneficiaries

(f) The beneficiaries are able to protect their gift from any creditors or from a Family Law dispute.

Order the Book

As the amount of intergenerational wealth transfer continues to increase rapidly, so does the importance of all

forms of succession and estate planning. Ensuring appropriately crafted estate planning documents are in

place is particularly critical.

The Nine Steps to a Complete Estate Plan is a comprehensive reference source for any adviser wanting to

deliver client focused solutions in the area.

A methodical, plain English drafting approach and a generous use of practical examples help to ensure the

book is user friendly. The book also includes references to legislation and related materials to address all

fundamental aspects of the estate planning process.

Specific topics addressed include:

(a) personally owned assets;

(b) superannuation;

(c) trust assets;

(d) interests in companies or partnerships; and

(e) all relevant tax issues that arise.

Available for purchase as

paperback for $60.00

including P+H.

Buy Direct

The Nine Steps to a Complete Estate Plan