As a director of an incorporated company, you are subject to several duties under the common law and the Corporations Act 2001 (Cth).
Specifically, company directors have a duty to:
Acting in good faith in the best interests of the company, and for a proper purpose
Directors are required to exercise their powers and discharge their duties in good faith in the best interests of the company, and for a proper purpose.
While companies’ interests will be necessarily diverse across industries, satisfying the interests of shareholders, customers, and employers will generally be seen as consistent with the company’s long term financial advantage.
A breach of the obligation to act bona fide in the interests of the company involves a consciousness that an action is contrary to the interests of company, and deliberate conduct in disregard of that knowledge.
A breach of this duty may further attract criminal liability where directors act dishonestly or recklessly, with the penalty being a maximum of fifteen years imprisonment.
Act with reasonable care and diligence
Directors are required to exercise their powers and discharge their duties with the degree of care and diligence that a reasonable person would exercise if they were a director in the company’s circumstances, and had the same responsibilities of that director.
Whether a director has exercised a reasonable degree of care and diligence is to be determined by reference to the foreseeable risk of harm relative to the potential benefits that may reasonably have been expected to result from the conduct in question.
In practice, the duty requires that directors:
Prevent insolvent trading
Directors have an ongoing duty to ensure that the company does not trade whilst insolvent, or where they have reasonable belief that it might be insolvent.
To satisfy this duty, directors must consider the company’s solvency before allowing it to incur further debts and must satisfy themselves that it is objectively and reasonably likely that the company will be able to pay their debts as and when they fall due.
The duty may be breached if the company:
1. Incurs a debt whilst insolvent; or
2. Becomes insolvent by incurring the debt; or
3. Becomes insolvent by incurring that debt and other debts at the same time; and
4. There are reasonable grounds for suspecting that the company is insolvent or the company would become insolvent as a result of incurring that debt; and
5. Either the director is aware that there are such grounds for suspecting insolvency, or a reasonable director would be aware there are such grounds for suspecting insolvency.
If civil proceedings are commenced for a breach of the duty to prevent insolvent trading, several rebuttable presumptions will apply, including:
A director found to have failed to prevent insolvent trading may be held personally liable for debts incurred by the company whilst it was insolvent.
Not improperly use information or position
Directors must not improperly use their position to gain an advantage for themselves or someone else, or cause detriment to the corporation.
Similarly, a person who obtains information by virtue of their position as director must not improperly use said information to gain an advantage for themselves or someone else, or cause detriment to the company.
Improper use of information or position may attract criminal liability where a director acts intentionally and recklessly, with a maximum penalty of fifteen years imprisonment available in respect of a breach of each of the duties.
Further, importantly, it is not a defence in proceedings for an offence in relation to these duties that the person used their position or information with the intention or consequence of gaining an advantage for the corporation.
Avoid conflicts of interest
Directors are required to avoid or appropriately manage any actual or potential conflict between their obligations owed to the company, and their personal interests or other interests they may be subject to.
It is common for a company’s constitution to permit the company to enter into a contract, agreement, or arrangement in which a director has an interest, but preclude the director from voting if the interest amounts to a material personal interest. A director is required to disclose to the board any material personal interest they may have in connection with the affairs of the company.
Key takeaways
As a director, it is important to be familiar with these duties to ensure you remain compliant when managing your company. Otherwise, the risk of criminal and civil penalties is significant, extending to fines, terms of imprisonment, and potential disqualification from holding a directorship.
What is it?
Under the Fair Entitlements Guarantee Act 2012, The Fair Entitlements Guarantee Recovery Program (FEG) was introduced by the Department of Employment and Workplace Relations. The FEG programme is a government initiative which provides financial assistance to employees who have lost their job through bankruptcy or insolvency of their employer.
In simple terms, this essentially means that the government can provide a temporary grant to the company so that they can pay their employees when they have insufficient funds to do so.
Under the Bankruptcy Act 1966 (Cth) “Bankrupt” is defined as a person a) against whose estate a sequestration order has been made; or b) who has become a bankrupt through a debtor’s petition.
Under the Corporations Act 2001 “a person is insolvent if they are unable to pay their personal debt when they fall due”.
This process then makes the FEG an active creditor who can then hold meetings and collaborate with liquidators to make sure all the correct processes are followed, and the employees get back as much of what is owed to them as possible.
Role and responsibilities of the FEG Active Creditor
The FEG active creditor has several duties in their role as an engaged creditor which include, attending meetings, participating in Committees of Inspection, reviewing distributions, as well as engagement with insolvency practitioners on legal issues that concern the recovery of FEG advances as well as outstanding superannuation.
What’s changed?
The FEG aims to recover employment entitlements and as of 1 July 2024, the program was recalibrated to include unpaid superannuation guarantee charge (SGC) amounts owed by insolvent employers during the liquidation or bankruptcy process.
So, what does this mean?
This means that that any retirement savings due to be paid out may also be recovered so not only will they receive their unpaid wages, but they will also be paid any unpaid superannuation.
This is a positive step forward as it provides more comprehensive financial support to the employer and the employee. In turn, this helps workers to support themselves and their families during a tough time until they find employment elsewhere.
Why does it matter?
Previously, employees might have missed out on pension funds worth thousands of dollars that had taken years of hard work to accumulate. This advancement ensures improved retirement outcome for Australians across the country. Therefore, the recent recalibration overall, will improve the long-term outcomes for employees of insolvent employers.
Am I Eligible?
There are certain conditions which need to be met in order to qualify for eligibility under the FEG programme.
These are outlined in Part 2 of the Fair Entitlements Guarantee Act 2012 which states:
It is important to note here that all conditions must be satisfied in order to qualify for FEG assistance.
This article was prepared with the assistance of Abbey Beaton.
In February of 2024, the Australian Parliament passed the Migration Amendment (Strengthening Employer Compliance) Bill 2023, amending the Migration Act 1958 to address the exploitation of migrant workers and strengthen employer compliance.
What is changing?
Designed to address issues regarding migrant worker exploitation, the amendments:
Migrant Workers’ taskforce
The amendments followed extensive consultation with unions, businesses, and relevant stakeholders which revealed systemic migrant worker exploitation across all industries.
The Migrant Workers’ Taskforce (MWT) was established in 2016 for the purpose of investigating and identifying proposed reforms to address the exploitation of migrant workers. In its 2019 report on the issue, the MWT identified several factors as being primary contributors to exploitation, including:
The exploitation of migrant workers takes many forms, but may entail the following:
Among the findings of the MWT’s investigation was the revelation that almost a third of temporary migrant workers earned $12 per hour or less, and almost half earned $15 per hour or less.
Implications for employers
The amendments to the Migration Act are of great significance to employers, particularly those who employ temporary migrant workers.
In placing greater responsibility on employers to ensure they adhere to visa conditions and employment regulations, businesses can expect to receive greater scrutiny and oversight of hiring practices. In particular, employers will need to demonstrate strict adherence to visa requirements, such as fair wages and appropriate working conditions, to avoid potential civil and criminal penalties.
Employers have an ongoing legal obligation to ensure their workers comply with their visa conditions. As such, the following should be subject to continual monitoring:
Businesses found to have any migrant workers working in breach of their obligations may receive fines of up to $123,000 for each offence, with directors and executives also vulnerable to being found personally liable for non-compliance. Given this, it is of utmost importance that businesses are proactive in taking steps to mitigate the risk of non-compliance.
*This article was prepared with the assistance of Clea Philips
Probate is the legal process of confirming a deceased person’s will and giving the executor the authority to manage and distribute the estate. While probate serves the same purpose across Australia, each state has its own procedures and documentary requirements.
This overview explains the general process and highlights key differences between jurisdictions.
Across NSW, ACT, QLD and WA, probate:
| Topic | NSW | ACT | QLD | WA |
| Application lodged in the Supreme Court | Yes | Yes | Yes | Yes |
| Original will required | Yes | Yes | Yes | Yes |
| Public notice required before applying | Required | Required | Required | Not required |
| Formal filing deadline | Expected within 6 months, explanation required if later | No strict statutory limit | No strict statutory limit | No strict statutory limit |
| Executor duties | Estate vests in NSW Trustee until probate; executor’s authority begins at grant. Duties include collecting assets, paying debts, and distributing estate. | Estate vests in Public Trustee until probate; executor administers estate after grant. | Estate vests in executor from date of death; executor collects assets, pays debts, lodges tax returns, and distributes estate. | Estate vests in Public Trustee until probate; executor’s authority begins at grant; executor manages and may sell/lease assets for administration. |
Managing probate can be complex, especially during a difficult time. An estate planning lawyer can:
The team at Chamberlains is here to guide you through the process. We’re With You.
Probate is a legal process that involves validating a deceased person’s will and administering their estate. The process and requirements can vary slightly between states and territories.
Probate in New South Wales
In NSW, the probate process primary purpose is to formally recognise the will of a deceased person as their last testament, allowing the appointed executor to administer the estate according to the will’s terms.
1. Application for Probate:
(i) Eligibility: The executor named in the will, or any interested party, can apply for probate. The applicant must be able to prove that the deceased’s will is valid and that they have the right to act as the executor.
(ii) Required Documents: Include the original will, a death certificate, an affidavit of the executor, and a probate application form and other documents prepared by the estate lawyer.
(iii) Court Process: The application is lodged with the Supreme Court of NSW. If the Court is satisfied with the application, it grants a probate, which gives the executor legal authority to manage and distribute the estate.
2. Administration of the Estate:
Once probate is granted, the executor can proceed to gather the deceased’s assets, pay any debts and taxes, and distribute the remaining assets to the beneficiaries as per the will.
Executors are required to adhere to fiduciary duties, ensuring that the estate is managed in the best interests of the beneficiaries and in accordance with the will.
Probate in the Australian Capital Territory
In the ACT, the probate process for applying for probate and administering an estate are somewhat like those in NSW but have specific local requirements.
1. Application for Probate:
Eligibility: As with NSW, the executor named in the will, or an interested party, can apply for probate. The applicant must demonstrate the validity of the will and their right to act as executor.
– Required Documents: The application includes the original will, a death certificate, affidavits from the executor, and a completed probate application form.
Court Process: The application is submitted to the Supreme Court of the ACT and if satisfied, it will grant probate, authorising the executor to manage the estate.
2. Administration of the Estate:
Post-probate, the executor must administer the estate by collecting assets, settling debts, and distributing the assets to beneficiaries as specified in the will.
Executors in the ACT are also bound by fiduciary duties and must act in the best interests of the beneficiaries.
If you’re an Executor having to deal with probate, it’s often a good idea to consult an Estate Lawyer professional who can guide you through the process based on the specifics of your case and local requirements. The team at Chamberlains are here to help guide you through the process. Were With You.
Foreign purchasers of residential property in Australia may be required to pay additional stamp duty depending on the state or territory in which they buy. The rules differ substantially between jurisdictions, especially following recent changes in NSW on 8 April 2024. This article explains the current position in NSW, ACT, Queensland and Western Australia in a single, streamlined overview.
| Jurisdiction | Surcharge Rate | Current Position |
| NSW | 8% Surcharge Purchaser Duty | Foreign persons must pay an extra 8%. From 8 April 2024, citizens of NZ, Finland, Germany, India, Japan, Norway, South Africa and Switzerland are no longer exempt. |
| ACT | 0% (No surcharge) | The ACT does not impose any foreign purchaser surcharge duty. |
| QLD | 7% AFAD | Foreign individuals, corporations and trusts must pay an additional 7%. No treaty exemptions. |
| WA | 7% Foreign Buyers Duty | Foreign individuals, corporations and trusts must pay an additional 7%. No exemptions for visa types. |
Foreign persons buying residential property in NSW must pay an additional 8% on top of normal transfer duty.
Example:
A $1,000,000 residential purchase attracts:
Previously, citizens of nine countries were exempt due to tax treaties. These exemptions were removed. The affected nationalities are:
All now pay the 8% surcharge unless they otherwise qualify as “ordinarily resident”.
You are not a foreign person if you are:
Most temporary, visitor, business, work and bridging visa holders are foreign persons under NSW law and must pay the surcharge. For further assistance from a local conveyancer, reach out to our Sydney conveyancing lawyers or Newcastle conveyancers.
The ACT does not impose any foreign purchaser surcharge. All buyers—local and foreign—pay the same standard stamp duty under the Duties Act 1999 (ACT).
The NSW changes on 8 April 2024 do not affect ACT transactions.
While no ACT surcharge applies, foreign buyers may still need:
Visa type is irrelevant for duty purposes in the ACT. For legal support from a local conveyancer, reach out to our Canberra conveyancing team.
Queensland charges AFAD at 7% on residential property acquisitions by foreign persons, in addition to standard transfer duty.
Example (for a $1,000,000 property):
Queensland was not affected by the NSW treaty change and has never offered treaty-based exemptions.
Under the Duties Act 2001 (Qld), a foreign acquirer includes:
There is no 200-day residency test.
Most temporary, work, visitor, bridging and partner visa holders remain foreign persons until they obtain permanent residency. For legal assistance from a local conveyancer, reach out to our Brisbane conveyancing solicitors.
Western Australia applies a 7% Foreign Buyers Duty on residential property purchases by foreign persons.
Example (for a $1,000,000 property):
There are no treaty-based exemptions and WA was not affected by the NSW changes.
Under the Duties Act 2008 (WA), a foreign person includes:
Visa type does not protect a buyer from the surcharge, all non-citizens and non-permanent residents are liable. For legal assistance from a local conveyancer, reach out to our Perth conveyancing team.
Foreign purchaser stamp duty varies widely across Australia:
Because these surcharges can add tens of thousands of dollars to a property purchase, foreign buyers should seek legal advice before signing a contract to ensure they understand:
This article was prepared with the assistance of Jack Harman.
The High Court of Australia recently granted special leave to hear an appeal from the Victorian Court of Appeal in the matter of Trustees of the Christian Brothers v DZY (a pseudonym) [2024] VSCA 73.
The matter was initially heard by the Victorian Supreme Court (DZY (a pseudonym) v Trustees of the Christian Brothers [2023] VSC 124) and the judge in that case set aside the settlement deeds in their entirety.
The Trustees of the Christian Brothers appealed to the Victorian Court of Appeal. The Court of Appeal set aside the original judge’s decision and made the following additional order:
Pursuant to s 27QE(1)(a) of the Limitation of Actions Act 1958:
(a) the deed of release between the respondent, the applicant and Brother Vincent Duggan dated 14 December 2012 be set aside only in part, such that the respondent be permitted to bring his claim for damages as framed at the time of that deed, that is a claim for loss and damage excluding any economic loss; and
(b) the deed of release between the respondent, the applicant and Brother Peter Clinch dated 9 December 2015 be set aside only in part, such that the respondent be permitted to bring his claim for damages as framed at the time of that deed, that is a claim for loss and damage excluding any economic loss.
Essentially, the order of the Court of Appeal meant that the plaintiff would not be permitted to bring a claim for economic loss against the Trustees of the Christian Brothers.
We will provide a further update following the publication of the judgment of the High Court.
This article was prepared with the assistance of Sarah Hayman.
You have found your dream property and need assistance with the legal process. A common question that arises is what is the difference between a conveyancer and a conveyancing lawyer? This article explains some of the key differences to help you make an informed decision, whether you are seeking conveyancing services for a simple transfer or a more complex property transaction.
A conveyancer is a licensed professional who guides clients through the process of buying or selling property, ensuring all legal requirements are met. This includes:
A conveyancing lawyer (also known as a property lawyer) is a qualified legal professional. A conveyancing lawyer handles the same tasks as a conveyancer but can also offer legal advice and representation in more complex property transactions, including:
A conveyancer in New South Wales typically completes a diploma in conveyancing at TAFE NSW before being accredited with NSW Fair Trading.
A conveyancing lawyer holds a law degree and has undergone extensive legal training before being admitted as solicitors of the Supreme Court of New South Wales, allowing them to provide broader legal services. They are accredited by the Law Society of New South Wales.
Generally, a conveyancer Sydney can manage basic legal aspects of a property transaction, but they are restricted in providing legal advice on matters outside conveyancing. They may assist with buying or selling residential property, first-home purchases or transfers between family members. They generally offer a cost-effective solution, as conveyancers generally charge lower fees than conveyancing lawyers.
A conveyancing lawyer can provide the same services provided by a conveyancer. In addition, they can provide advice on more complex legal matters, including commercial property transactions, contracts with unusual terms, disputes over property ownership or title, and transactions involving high-risk factors, such as properties under development or those subject to legal claims.
The role of a conveyancing lawyer extends beyond the standard conveyancing process, providing critical legal advice and helping to prevent potential legal issues down the track. Many conveyancing lawyers will offer fixed-fee services for conveyancing services. The additional cost of hiring a lawyer is often justified when dealing with more intricate transactions or legal matters that require in-depth legal expertise.
When deciding between a conveyancer and a conveyancing lawyer, it is important to assess the complexity of your property transaction and your specific needs.
If you require any conveyancing services or have any questions, please do not hesitate to contact our Conveyancing Team.
*This article was prepared with the assistance of Mohamad Mourtada
Self-managed superannuation funds (SMSFs) have become increasingly popular in recent years due to the control they give people over their retirement savings. Often SMSFs will purchase property as an investment to generate income, but there are some key considerations that people need to be aware of prior to entering into such transactions.
What to be Aware of
Buying property through a SMSF can be complex and fraught with difficulty but if you have the correct advice, the process can be seamless. Common issues that can arise with these purchases include non-compliance with legislation, financing hurdles and inadvertent stamp duty consequences. It is important that purchasers are aware of the following considerations when buying property in their SMSF:
Take home lessons
It is imperative that anyone purchasing property through a SMSF seeks appropriate legal and financial advice prior to entering into such a transaction. A failure to comply with the relevant legislative provisions and consider the stamp duty implications of such transactions can have adverse consequences. Chamberlains Law Firm has acted for many SMSFs when purchasing property and can assist clients navigate these complexities with ease and due care.
*This article was prepared with the assistance of Jack Harman
Probate is the legal process through which a deceased person’s will is validated and authority is granted to the executor to administer the estate. While the purpose of probate is consistent across Australia, the procedures and requirements differ between jurisdictions. The following provides a clear, comparative overview of the probate process in NSW, ACT, QLD and WA.
Probate is the Supreme Court of NSW’s confirmation that a will is valid and that the executor has authority to manage and distribute the estate.
Applications should be filed within six months of the date of death. If lodged later, the Affidavit of Executor must explain the delay.
Once probate is granted, the executor must collect assets, pay debts and expenses, and distribute the estate according to the will.
The inventory must disclose all assets and liabilities, including those held outside NSW.
Probate is the Supreme Court of the ACT’s confirmation that the will is valid and that the executor may administer the estate.
Applications are filed with the Supreme Court of the ACT and must include:
Applications are generally expected within six months of death, unless the Court grants leave for a later filing.
Executors must gather assets, pay debts, and distribute the estate in accordance with the will or intestacy rules.
The Court may request further information before granting probate.
Probate confirms that the will is valid and gives the executor authority to administer the estate under Queensland law.
Applications must be filed with the Supreme Court of Queensland. Before filing, QLD requires:
Required documents include the original will, death certificate and an affidavit of executor.
Queensland has no fixed statutory deadline for probate applications.
However, applications must be made within a reasonable time, and delays may require explanation.
If no one applies within three months, the Public Trustee may step in to administer the estate.
Executors collect assets, pay debts and testamentary expenses, lodge tax returns for the deceased and the estate, and distribute the estate.
Rectification applications (to correct clerical errors in a will) must be made within six months unless the estate has not been fully distributed.
Probate is the Supreme Court of Western Australia’s confirmation that a will is valid and the executor may administer the estate.
Applications may be submitted through the WA Probate Online Application for straightforward estates. Required documents include:
There is no strict statutory deadline, but applications must be made within a reasonable time. Delays must be explained.
The Court must be satisfied the will was validly executed and the deceased had testamentary capacity.
Additional information may be requested before granting probate.
Executors must collect assets, pay debts, and distribute the estate according to the will. They may also sell or lease real estate if necessary for administration.
| Aspect | NSW | ACT | QLD | WA |
| Filing Deadline | Within 6 months; explanation required if later | Within 6 months; extensions possible | No statutory deadline; notice requirements; Public Trustee may act after 3 months | No statutory deadline; explanation required for delay |
| Online Application System | Mandatory for most cases | Not mandatory | No | Available for straightforward cases |
| Notice Requirements | None | None | Mandatory Notice of Intention to Apply | None |
| Inventory of Property | Required (Form 117) | Required | Required in affidavit | Required |
The probate process differs significantly between jurisdictions, including documents, deadlines, and procedural steps. Obtaining legal guidance ensures compliance, reduces delays, and protects the executor from personal liability.
The team at Chamberlains is here to assist you through the entire probate application and estate administration process. We’re with you.