E-Commerce and you

Dear Readers

I was recently asked by the Perth Woman magazine to write my bi-monthly article based on the word "E". I decided that E-Commerce was the most relevant topic of the day. In our daily lives now, we deal with the internet and transact our lifestyles using the world wide web.

There are many things to be wary about in the way we use the internet. I hope the article from the Perth Woman magazine may give some pointers to my readers.

What to do before you put in an offer to buy a business

Dear Readers

I have been writing in my blog about going into business. There are so many potholes you can step into if you are not careful. Tan and Tan Lawyers have been advising clients on their business purchases for many years.

My greatest joy is seeing a client who is about to go from being employed to being self employed. I love coaching them in the right way to buy a business and what to look out for.

I had a chance to make a podcast with my business coach, Jeff Miles yesterday. Yes, I have had a business coach for the last 2 years and it has helped me improve my business tenfolds.

Reading books like E-Myth Revisited also helps.

For those who do not like reading, have a listen to my latest podcast at:

http://www.tanandtanlawyers.com/podcast/Perth_Asian_Lawyer_Podcast_-_Ep5_Buying_and_selling_a_business.mp3




Some of the issues raised include:

(a) what terms and conditions to include in your offer.
(b) what is the due diligence process.
(c) what can go wrong if the offer is not drafted properly.

Do send me an email if you have any questions.

Remember , at Tan and Tan Lawyers, we protect your interest and save you money.

Growing old and being a grave digger

Dear Readers.

Last night, I received a call from my mother in law at 12 midnight. Her 12 year old pomeranian called Choi Choi had just passed away after a few agonising weeks of pain. She was too distressed to deal with the deceased pet and needed help.

My wife and I had to drive to her house after discussing what to do with the deceased pet. We decided that instead of waiting for the morning to organise a cremation, it was best to organise a quick burial as leaving the deceased pet in my mother in law's home for the night would be too distressful for her.

So, there I was, your friendly neighbourhood lawyer digging a hole in the garden past midnight.

If you see someone digging a hole in the garden at night, be very wary. If the hole is a man size hole, there probably is some foul play.

I am glad I do not work as a grave digger because it is hard work. After a quick prayer, the pet was laid to rest.

I then shared a coffee with my mother in law and my wife.

My mother in law is now reaching 80 years of age. Her memory is not as sharp as it used to be. She has been such a great grandma to my children. She picks them up every day from school and organises a quick meal for them if they are hungry. My wife and I would not be able to manage the legal practice as efficiently as we do if we did not have my mother in law's help every day.

Which brings me to the topic I wish to discuss. It is the issue of granting an Enduring Power of Attorney or EPA as they are commonly called.


What is an EPA?

An EPA is a legal document allowing you to appoint another person to make financial and property decisions on your behalf.

A person who makes an appointment under an EPA is called the DONOR. A donor can authorise another person or persons to be their ATTORNEY to act for them if they become mentally ill or lose their decision-making ability.

An EPA is different from a normal Power of Attorney, which only remains valid so long as the donor is still capable of making decisions. Under an Enduring Power of Attorney, an Attorney can act even after the donor loses their legal capacity.


What does an EPA authorise my Attorney to do?

An EPA does not authorise your Attorney to do everything on your behalf. It will only authorise them to make decisions about your FINANCIAL and PROPERTY affairs. It is important to remember that an EPA does not cover non-financial decisions – for example decisions regarding your health care or medical treatment.

If you are unsure about the types of decisions that an Attorney can make under an EPA, you should seek legal advice.


Why Should I Make an EPA?

An EPA is necessary to protect your assets and ensure that they are managed by someone you know and trust in the event that you suffer a mental disability.

If you own any property, you should consider making an EPA. A loss of legal capacity can be gradual or sudden, occurring as a result of an accident, injury or through illness or trauma later on in life.

It may not be possible to predict or prevent the onset of mental disability, but by appointing an Attorney under an EPA, you will be safeguarding your interests by putting your financial affairs in the hands of someone you trust.


Who should I appoint as my Attorney?

You can appoint anybody to be your Attorney, including your spouse, partner, children, relatives, friends, lawyer or financial adviser. You can also appoint more than one Attorney, for example where you want your children to act together (or separately) as your Attorneys.

The most important consideration you must make before appointing an Attorney is whether you can trust that person to make decisions about your financial affairs. Ideally, it should be someone who you know will manage your affairs and make decisions in your best interests.

I often tell my clients to consider the following:

If you appoint one of your children to be the attorney, is that child going to put you in the cheapest nursing home or the most expensive. Bear in mind that when you pass away eventually, that child may stand to inherit a more valuable asset if he or she placed you in an "el cheapo" nursing home.

What happens if I don't make an EPA?

If you lose your ability to make decisions and have not appointed an Attorney under an EPA, the State Administrative Tribunal may appoint an Administrator on your behalf to manage your affairs.

Take note that a state appointed Administrator may not necessarily be someone who you trust to manage your financial matters. It is very important that you consider the need for an EPA to be in place to prevent this possibility from arising.

In most cases, an EPA will be preferable because it gives you the power to appoint someone to be your Attorney. At the end of the day, the time and cost involved in making an EPA will be a small price to pay for your peace of mind.


How do I make an EPA?

For an EPA to be valid, it must comply with the requirements set out in the Guardianship and Administration Act of 1990.

In addition, a person making an EPA must be of sound mind when the EPA is made. If there is any doubt as to the mental state of the donor, a medical opinion should be sought to confirm their legal capacity.

There are standard EPA forms that are available for download on the State Government’s website. As a donor, you can complete an EPA yourself or you can arrange for a lawyer or Trustee Company to prepare the documents for you.

You can also specify in your EPA exactly how you want your Attorneys to carry out their responsibilities. All Attorneys will have obligations under the Guardianship and Administration act and it is open for you to provide special conditions that apply whenever they make decisions for you.

If you are unsure about the legal effect of an EPA or what rights and obligations an Attorney has, you should seek legal advice.


When does my Attorney’s appointment come into effect?

An Attorney appointment can come into effect either immediately after the EPA has been signed, or only once the donor has been declared legally incapable of making decisions.

In your EPA, you must specify whether you want the Attorney to assume power immediately, or whether the appointment will only be valid after the State Administrative Tribunal makes an official declaration that you do not have legal capacity to make your own decisions.

If you appoint an Attorney to act immediately, it is important to remember that your Attorney must act in accordance with your directions whilst you are still legally capable.

An EPA can be revoked at any time, provided that you are still of sound mind at the time you revoke it.

As we get older, we may need to consider arrangements that can protect our assets if we are unable to do so ourselves.

As the population gets older, it is imperative that EPAs be considered as early as possible before it is too late.

Till my next blog, I hope you all keep well physically and mentally.

Partnership issues if you become self employed with a partner

Dear friends and readers

It is a new financial year. You may have looked at my last 2 blogs about going into business.

Sometimes, you may find that although you wish to become self employed, you may not have the funds to go on your own into a business.

You might have considered having a partner to share the expense , the load and the risk. Sometimes that may be a good idea as two heads are better than one.

However, there are several things to consider as having a partner can be like going into a marriage. Questions that may need to be considered include:

(a) do I really need a partner?
(b) Is the partner going to be a blessing or a curse?
(c) What is the partner going to do for the business?
(d) What if I want to dissolve the partnership?
(e) Should I have a partnership agreement?
(f) What happens if I do not have a partnership agreement?

Well, I had the opportunity of discussing some matters regarding partnerships with Jeff Miles, my business doctor. Have a listen to our latest podcast which may save you a load of money if you are thinking of taking on a partner.

Please visit

http://www.tanandtanlawyers.com/podcast/Perth_Asian_Lawyer_Podcast_-_Ep4_Partnerships(3).mp3


If you have any questions regarding a potential partnership issue, feel free to email me at ray@tanandtanlawyers.com

Till then, have a good day.

Golfing and being in Business

Dear Readers

The golf bug has hit me again. I had been away from the golf course for over 13 years after my 1st son was born. That was because I could not justify playing golf and spending the time away from my young children.

Well the kids are now able to play golf and walk and play at least 9 holes with me. They do complain and usually ask to use a motorised buggy. But, what the heck, what's the point of playing golf unless you walk. That is what I say.

I have also been fortunate in being able to play with the Pua brothers on a weekly basis. They are inspirational and motivational. Henry, Frank and Ray Pua have been my constant companions and guides to bring me back to the love of golf. Thanks guys.

Bought the missus a brand new golf set too so she can get into the game properly.

Well, what has that got to do with the law, you may ask.

You see, I have been able to take a Thursday afternoon off every day to play golf.

Now if you were employed, what is the chance of doing that on your boss's time?

If you are the boss, of course you are able to do that as long as :

(a) you have systems in place for your business;
(b) you are able to delegate your work;
(c) you manage your time appropriately.

Which brings me back to the new article I have written for Perth Woman and which is a continuation of my last article about being a boss.

Please look at:











For my friends and clients who are also golf enthusiasts, do drop me a line if you wish to have a game with me.

Podcasting

If you listen to the latest marketing gurus, it seems podcasting is the new way to promote your business.

I quite agree and I have been spending time organising podcasts to showcase some of the areas of the law that I deal with.

It has helped my clients as I can quickly refer them to a source of legal knowledge.

I have learned so much about podcasting in the last few weeks. Thanks especially to Andrew Real, Consultant, based in England. He has been a real blessing and a fountain of knowledge.

Andrew can be contacted at Andrew Real [andrew@seaton-electronics.co.uk].

I met Andrew through www.elance.com. That is an amazing portal where you can appoint all sorts of consultants to assist you in your work. It is truly a global market place.

Well, the result of it all is the first podcast by myself dealing with family law.

I must have gone through the same speech a thousand times to my family law clients. So I thought it would be great to podcast it so I do not have to repeat myself.

The 2nd podcast is in relation to wills. This is an interview with my business mentor who is called Jeff Miles the Business Doctor. Have a listen as you will definitely find the subject interesting.

I hope to update the podcast subjects as often as twice a month. If there is any subject you readers are interested in, please send me an email.

Till we blog again, have a good evening.

Have a look at http://www.tanandtanlawyers.com/legal_podcasts_podcasts.html

Things that can go wrong when Associations are not managed properly

Dear Readers,

I was recently involved in a Supreme Court case where the acting secretary of the Association tried to sell part of the Association's land without authority.


The summary of the case is as follows:

The AUSTRALIAN CHINESE CONFUCIUS-MENCIUS SAINT TAO CENTRE INC association was incorporated in Dec 1992 by 6 well meaning Saint Tao followers. The religion incorporates elements of Confucianism, Taoism and Chinese Buddhism.

One of the founding member was Sheng Chin Lai (the “Plaintiff”) in SUPREME COURT OF WESTERN AUSTRALIA action Lai v Tiao (No. 2 (2009) WASC 22.

In 1995, Lai donated over $250,000 to the Association to purchase Lot 42 Warton Road, Canning Vale, Canningvale with the aspiration that a Tao Centre temple would be constructed on the land, and eventually, homes built for the elderly in its vast compounds.

The other founding members were Cheng Chih Tiao, Hui Ping Wang (both known as the First defendants in this case), Yun Sen Chou, Ho Ming Wang and Song Tyan Kuo.
With the donations from over 200 donors and well wishers, a temple was constructed and completed in March 1996 with a grand opening ceremony.

The list of of over 200 contributors is engraved on a marble plaque which is placed at the temple.

In April 1996, there was a meeting between the 6 original contributors, ie Lai and Chou, Ho Ming Wang and the 1st and 2nd defendant and finally Kuo. There was a huge disagreement between the 6 original contributors regarding how the temple should be operated. Lai and Chou decided to make things easier for all concerned by refraining from further involvement in the temple.

Ho Ming Wang died in 2001, and the First defendants, Tiao & Wang took total control of the association and its funds.

On 11 May 2004 Tiao signed a contract to sell part of the temple land to Level Holdings Pty Ltd (“Level”). According to the contract, in return for developing the land into ten lots, Level will keep 5 lots and the Association was to keep the other 5 lots.

Tiao signed the contract, using his personal address and without the Association’s seal.

By sheer chance, Lai discovered that the land was being developed in Jan 2005 and immediately instructed Tan and Tan Lawyers to lodge a caveat to protect the interest of the Association.

On 17 Jan 2005 and 1 Feb 2005, Lai through Tan and Tan Lawyers demanded from Tiao all information regarding the contract with Level as Lai suspected no authorisation had ever been sought by Tiao from the members.

Instead of responding to the question as to whether he was authorised to sell the land, Tiao signed up 38 new members, who comprises some of his family and friends. He now claimed they are the new members of the Association.

He then organised the 1st ever AGM of the Association on 26 Feb 2005 and convinced the “new members” to pass resolutions to:

1. Approve the development of the land to raise infrastructure funds for the Association.

2. Ratify all past acts, deeds, transactions and omissions of whatever nature of each of the officeholders.

When Lai finds out about the 1st ever AGM and the resolutions that were passed, Tan and Tan Lawyers went to the Supreme Court and obtained an injunction against the land being transferred to Level.

By this time the land was worth, conservatively, at $1.8million.

The injunction was granted on 19 Apr 2005. At the injunction hearing, it became clear that the Association had never maintained a list of members, from 1992 until the issue was raised on 10 January 2005 by Tan and Tan Lawyers. There was therefore no authorisations obtained from any members regarding the land sale to Level Holdings.

At this point, it was also revealed that no accounts were ever maintained by Tiao in that time. It also appeared that the Association’s funds were merged with Tiao’s personal accounts.

For the next two years numerous interim applications and injunctions were lodged and fought by the parties until the final hearing which was heard on 19 Nov 2007 for 6 days.

The hearing centred around :

(i) Who is supposed to be a member of the Association as Tiao never kept any list of members or proper accounts from 1992? (ii) whether the selling of the land was authorised.

None of the donors who contributed towards the temple building funds were consulted on the sale of the land as Tiao insisted they are not members and had no interest in the Association.

Tiao claims his 38 members should be the only legitimate members as they were on record at the first ever AGM. And since they had ratified his actions at the first ever AGM, his actions were sanctioned.

Lai was of the opinion that all persons who had contributed towards the Temple construction should be accepted as legitimate members.

(ii) Was Tiao authorised to sign the Level Holdings land contract? The decision of who is a member was crucial to the answer.


The decision of the Judge was delivered in a 162 page judgement on 12 Feb 2009 as follows:

(i) All persons who had initially contributed towards the temple construction and whose names are listed in the temple plaque are the rightful members of the Association.

(ii) That the meeting on 26 Feb 2005 where the 38 members were signed up by Tiao were invalid. Therefore the resolutions passed to ratify the actions of Tiao and the decision to continue with the sale of the land to Level Holdings are invalid.

(iii) The Judge found that Tiao operated the temple like his own “fiefdom” disregarding the interest of the persons who should be the rightful members.
Quote from Justice Johnson:

“In my opinion, at all times the first defendants (“Tiao and Wang”) have acted out of self interest and not in the interests of the Association and it’s membership. Over time, Tiao has adopted the approach that it is his perogrative to decide what is in the best interests of the Association. He either has no grasp of the concepts of separate corporate identity or chose to disregard the distinction between his view and that of the Association which would normally be identified by the resolutions passed by members at general meetings.

This is best illustrated by his decision to enter into the Level Holdings contract without raising the matter at a validly convened board meeting with notice given to all board members before putting the matter before the members of the Association at a validly convened general meeting. Such steps were required of Tiao but, in my view, he deliberately declined to take them”.

(iv) The Judge also found that Tiao had mixed his personal funds with the Association’s funds.

(v) The Judge declared that the contract to sell the land to Level Holdings was unauthorised.

(vi) The Judge also declared that Conal OToole and his counsel P McGowan, were not validly authorised by the Association to represent the interest of the Association.

The Judge has now ordered that there be a meeting as soon as possible by all members who are listed in the temple plaque to decide what they want to do to resolve the issues faced by the Association.

The Association continues to be represented by Mr Raymond Tan of Tan and Tan Lawyers while Ken Robson acted as counsel.

All members whose names appear in the plaque located at the Association’s premises are encouraged to contact Mr Raymond Tan to register their interest in the forthcoming Special General Meeting.

This is a picture of the plaque at the temple.




A copy of the full Judgement can be found at :

http://www.austlii.edu.au/cgi-bin/sinodisp/au/cases/wa/WASC/2009/22.html?query=lai