Autumn 2017 Newsletter

Introducing Hanna Devlin Family Lawyer

McLeods Lawyers are pleased to introduce the newest lawyer to our team Hanna Devlin, and an extension to our current family law practice to include family court work. We are now available for enquiries relating to all areas of family law from care of children through to estates.

Hanna has been with us since 2015 as our Trust Account Administrator and assisting our partner Sarah Jury. Hanna, originally from England, has spent this time converting her English legal qualifications allowing her to practice as a New Zealand lawyer.  This included spending the last few months of last year travelling to Auckland most weekends, a commitment and dedication that landed her with 3 awards from the College of Law, Auckland. She was admitted as a New Zealand lawyer on 10 February 2017 with our Partner Graeme McLelland as her moving counsel, at Auckland High Court.

Hanna has experience in a range of family law matters, from relationship property to claims under the Protection of Personal and Property Rights Act 1988.  Family law covers many disputes including those related to day-to-day care and contact with children, dissolution of marriage, domestic violence and relationship property claims.

Hanna qualified as a barrister in England and was called to the bar at Middle Temple in 2011. After qualification she spent time gaining experience in criminal law and family law. This included time spent with a judge in the Crown Court and working with barristers at the Old Bailey in London in the criminal field as well as working with clients in the Family Courts. She also spent time volunteering for CAB and with Victim Support, helping people with domestic violence.

After her time honing her criminal and family law experience Hanna worked in-house for an insurance intermediary, specialising in contracts and employment law.

Outside of work, when she is not studying, Hanna loves going to the gym and is a keen runner, completing the Kerikeri Half Marathon, her first of many, in a time of 2 hours, 6 minutes and 29 seconds. She is keen to beat her time and run it in under 2 hours this year.

Hanna’s other passion is travel.  It was during a 7 month OE with her partner and friends that she fell for New Zealand’s charms and natural beauty.  When she returned to the UK her and her partner immediately set about planning their move to Kerikeri, finally moving more than 11,200 miles from Kent, England to Kerikeri.

In Family Law, often the best results come from people trying to work together towards a resolution.  McLeods can help you work through the issues with the aim of achieving positive results.  If you would like advice regarding a family issue, or advice on any of the services we offer, please call us now 09 407 0170 or email Hanna at hmd@mcleods.co.nz

 

The Bright-line Test

In 2015, the government introduced the “bright-line test”, a method which attempts to tighten the property investment rules.

The bright-line test states that (subject to exemptions) any gain from disposing of residential land within two years of acquiring it will be taxable. The test only applies to residential land. Residential land is land that has a dwelling on it or could have a dwelling on it and does not include farms or business premises.

The bright-line test applies where a person’s “first interest” in residential land is acquired on or after 1 October 2015. Generally, a person acquires their “first interest” on the day they enter into an agreement to purchase residential land. The start and end dates may vary depending on the circumstances of each transaction.

For standard sales, the two year bright-line period starts when title for the residential land is transferred to a person under the Land Transfer Act 1952 and ends when the person signs a contract to sell the land. In other situations, such as gifts, the date of “first interest” is the date the title is registered by the donor and the end date is when the donee acquires registered title.

In simple terms, when a person purchases their main home after 1 October 2015 and then sells it within two years, the income they receive for the sale is not taxable. A person can only have one main home to which the bright-line test does not apply. If a person has more than one home, it is the home that the person has the greatest connection with that is considered the main home for the purposes of the test. Factors to assess when determining what constitutes a main home include; how often a person uses the home, where their immediate family is, where their social and economic ties are and whether their personal property is in the home.

The test is based on actual use of the property and not just a person’s intention to use the property as a main home. This exemption cannot be applied on a proportionate basis; therefore, if a house is used only partly as a main home, the exemption does not apply. Where a main home is held in a trust, the exemption is usually available; however, additional information is required to ensure trusts are not used to avoid tax.

A habitual seller cannot use the main home exemption. If a person has used the main home exemption more than twice in the previous two years at the time of selling their property, they are considered a habitual seller. A habitual seller also includes a person who regularly acquires and disposes residential land.  Where property is inherited by a person as a beneficiary and they subsequently sell the property, the disposal will not be subject to tax under the bright-line test. Where property is transferred between partners or spouses under a property relationship agreement, there are no tax implications. However, if the property is subsequently sold; the bright-line test may apply.

There have been cases where tax obligations arose through the disposal of residential property which did not result in financial gain to the seller. As a result, it is highly recommended that specialist advice is obtained in respect of all property transactions.

 

I have been named an executor of a will, what do I do now?

When a loved one passes away it can be a stressful time for the family, which can be made more difficult when the deceased has not left a Will. Where the deceased has left a Will they will have named their executor or executors (their representative(s)) in that Will.

The role of an executor is to administer the deceased’s estate. This may include settling outstanding debts owed by the deceased, and distributing the deceased’s estate in accordance with the deceased’s Will.

Before an executor can administer the estate of the deceased, they must first obtain Probate.

What is “probate”?

Probate is a court order determining the Will of the deceased as being true and authentic. The executor(s) is/are appointed in this order.  Upon the making of the order, the executor(s) then has/have the legal authority to deal with the deceased’s estate.

How do I apply for probate?

The executor(s) named in a Will must make an application in writing to the Wellington High Court for probate. The application must be in a specific format, as prescribed by a set of rules called the High Court Rules.

An application for probate may be filed in one of two ways either by way of ‘probate in common form’ or by way of ‘probate in solemn form’.

An application for ‘probate in common form’ is usually made on a ‘without notice’ basis, where the application is made without notifying anyone else, on the basis that no one will contest the Will.

In the event that it is highly likely that someone will contest the Will, an application for ‘probate in solemn form’ will need to be filed. In these circumstances the relevant parties will be notified of the application and a trial at High Court will proceed, for which the parties will probably need legal advice.

What would I need to make an application for Probate?

The High Court application fee for obtaining Probate is currently $200.00; this would need to be paid together with the filing of the following documents:

 How long does this process take?

If the Application has been drafted correctly, in the prescribed from, and filed acceptably with the Wellington High Court, it may take four to six weeks to process the application. However, it could take longer if the High Court is busy or the application is complicated.

This timeframe may also be drawn-out in the event that the application has not been drafted correctly and/or the High Court raises issues with the application.  Delays of this nature have the potential to cause a number of problems between the beneficiaries, and can affect an executor’s ability to administer the deceased’s estate, particularly if immediate action is required (which it often is).

With that in mind, legal advice should obtained when making an application for Probate.  Please call our office on 09 407 0170.

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McLeods Lawyers — 21 Hobson Avenue, Kerikeri, Bay of Islands, New Zealand — Phone +64 9 407 0170 — Email law@mcleods.co.nz

The information on this site is not comprehensive legal advice. Please contact us for advice and information suited to your needs.