by Amy Lowry | Apr 4, 2024 | Insights
Recently the Queensland Justice system has been thrusted into the spotlight with a focus on crime rates and the medias perception that Queensland courts are handing down soft sentences. However, the fact of the matter is that when a matter comes to sentencing there are a raft of principles and considerations that need to be considered.
Principles of Sentencing
Three main principles make up the framework for sentencing, that being punishment, rehabilitation, deterrence and to protect the community from the offender. From a punishment perspective, the punishment must fit the crime, which means that the sentence must be proportionate as well as being consistent. From a rehabilitation and deterrence perspective, the two principles work in conjunction by trying to address the issue or issues of the individual. The aim is to correct the individual’s behaviour which should lead to deterring the individual, and the community generally, from engaging in anti-social behaviour. However, when the courts hand down a sentence, they are guided by many other factors that must be considered to produce a fair and just punishment.
Section 9 of the Penalties and Sentencing Act 1992 (Qld) outlines the framework of what factors the courts must consider., including but not limited to:
- The nature and seriousness of the offence;
- the offenders age and character;
- Thephysical and mental harm caused to a victim and whether it is a domestic violence offence;
- indigeneity and any criminal associations;
- Any assistance with law enforcement;
- the maximum and minimum penalty available, and if relevant, the amount of time already spent in custody.
The list of considerations is extensive and is assessed on a case-by-case basis andwhich demonstrates the complexities of sentencing. However, the most important consideration is the risk posed to the community and the risk posed to the victims, which ultimately holds a higher threshold when those types of offences are concerned.
Custodial sentences
The sentencing guidelines provide that a term of imprisonment should only be imposed as a last resort and that a sentence that allows the offender remain in the community is preferrable. However, this does not apply to any offences that involve actual, attempted or procured violence against another, or if any physical harm to another has occurred.
Further, the most severe offences, such as homicide or manslaughter, will attract a mandatory sentence which requires the offender to serve a specific amount of time before being eligible for parole. The offender of serious violent offences will requires them to be declared a serious violent offender. Currently, mandatory sentences require a serious violent offender to serve 80% of the sentence or fifteen years, whichever is less. Once an offender has served the required amount of time of a custodial sentence they can apply for parole, which is not guaranteed and is considered by the Parole Board. A Serious Violent Offender declaration is made in the following circumstances:
- Automatically if the offender is sentenced to 10 years of more for a listed offence, including but not limited to, violence offences, sexual offences, drug offences;
- Or by judicial discretion by the sentencing Judge or Justice.
Another type of custodial sentence that generally receives community debate is suspended sentences. To receive a suspended sentence, the sentence must not be more than five years and must be served amongst the community. This allows the offender to remain in the community, provided they do not commit any further offences punishable by imprisonment during the operational period set by the Court. If that occurs, the offender is required to appear before the Court for breaching the suspended sentence, in addition to answering the further charge. On conviction for the further offence, the legislation provides that a Court must order that the offender serve the whole of the suspended sentence, unless it is unjust to do so. Alternatively, they can extend the operational period of the suspended sentence by no more than 1 year.
The Court can also impose periods of imprisonment with release on parole. The offender would then be subject to a parole order in the community, which requires them to be supervised, in addition to an array of other conditions. Parole can either be immediate on the day of sentence or can be set at a later date. In sentences where the offender is already on parole, or the head sentence is 5 years or more, the Court can only set an eligibility date for parole. This means that the offender will not be immediately released, rather, they must apply to the parole board for release.
Due to the need to correct an individual’s criminality and detention being the last resort, the courts can impose an intensive correction order, however, these types of orders are reserved for sentences that are less than one year and are supervised by correction staff in the community with a requirement that the individual participants in mandatory counselling or community service programs.
Non-custodial sentences
Non-custodial sentences are reserved for offences that are less severe which can include:
- Convicted and not further punished for the offencel
- Good behaviour orders with a recognisance, which requires the individual to make a promise to the court stating that they will not become before the court during the length of the order;
- monetary fines;
- compensation orders;
- probation;
- community service; and
- disqualification of drivers licences.
There are many different types of sentences and orders that can be imposed and many different types of circumstances that lead clients of the justice system. Just as vexed as those issues are, the role of sentencing is one that requires careful consideration of all factors.
by Amy Lowry | Apr 4, 2024 | Insights
What are statutory demands and when are they used?
Where a company owes a creditor at least $4,000.00, the creditor can elect to issue the company with a statutory demand, pursuant to section 459E of the Corporations Act 2001 (Cth) (The Act). The demand requires the company to either make payment of the debt within 21 days after service of the demand or apply to the Court for an order setting aside the Demand.
To issue a statutory demand, creditors must ensure they follow the strict requirements set out in the Act, namely:
- the demand must be in writing in the prescribed form, being a Form 509H;
- the demand must adequately specify the debt and the total amount owing by the company to the creditor;
- state the requirement for payment of the debt within 21 days after the demand has been validly served on the company;
- Form 509H must be accompanied by an affidavit of the creditor which sets out the validity of the debt due and currently payable by the company; and
- must be signed by or on behalf of the creditor.
If a company has been served a statutory demand and wishes to seek an order of the Court to set aside the Demand, the company must be able to demonstrate there is a genuine dispute over the debt. In this instance, the genuine dispute can relate to a dispute over the debt itself or on the basis of an inadequate or insufficiently particularised demand.
If a company does not respond within 21 days of service of a statutory demand, either by complying with the demand or applying for an order to set aside the demand, the company is presumed insolvent. The presumed insolvency of the company opens the door for the creditor to apply to the courts to have the company wound up. Therefore, the consequences of not acting swiftly upon service of a statutory demand are significant.
When you should not use a statutory demand.
As already mentioned, a company can apply to the courts to set aside a statutory demand where there exists a genuine dispute over the debt. In these applications, a genuine dispute is likely to be found by the courts where there is plausible contention over the debt, requiring investigation.
Where the company has already expressly accepted liability for the debt, it may be more difficult for the company to show there is a genuine dispute. The converse applies where the company has made the creditor aware of their dispute over the debt prior to the issuing of the demand, the courts will more readily accept there is a genuine dispute.
Therefore, in circumstances where a creditor is aware that there is a potential dispute between the parties about the debt (which could be over the amount of debt, when it is due and payable or any other dispute), it is not appropriate to serve a statutory demand.
Cost Consequences
The courts have the power under the Act, to order creditors who have issued statutory demands which have subsequently been set aside on application from the company, to pay the company’s costs in bringing that application. It is for this reason that creditors should take caution when considering serving a statutory demand and avoid utilising these demands as a means of standard debt collection.
Further, if a creditor issues a statutory demand but subsequently becomes aware of a genuine dispute over the debt, they should act promptly to withdraw the demand. This is because if the company files an application to set aside the demand and the creditor does not withdraw the demand in a timely manner and the courts find there is a genuine dispute, the courts may still award the company costs, even though the creditor did eventually withdraw the demand. This is based upon the principle reiterated in Progressive Projects Pty Ltd v McCullough Robertson Lawyers,[1] the courts have an overarching discretion to order costs.
Statutory demands can have significant consequences, both for companies who don’t respond to such demands within 21 days of service and for creditors who issue demands where there exists a genuine dispute. This is why it is imperative to be fully aware of your obligations as companies and creditors and act promptly.
If you’ve been served with a statutory demand or are seeking recovering of a debt from a company, please reach out to our team of experts for a confidential discussion. None of the above information is intended to be used as legal advice and you should always speak to a legal practitioner to seek advice where necessary.
[1] [2024] QSC 39, at [16].
by Amy Lowry | Apr 4, 2024 | Insights
Upon the breakdown of a marriage or de-facto relationship, important time limitations apply for property settlement or spousal maintenance applications.
The time limitation in in de facto relationships is two years from the date of separation, In the cases of marriage, the time limitation is 12 months from the date of divorce being effected by the Courts. This means that the time limit for married couples does not start when they separate, but rather when the couple is legally divorced. Parties are ineligible to apply for divorce until they have been separated on a final basis for at least 12 months.
It is important to negotiate and formalise an agreement as soon as possible and within the time limitations. This can be done by way of Consent Orders, filing an Application with the Federal Circuit and Family Court of Australia (‘The Court)’ or a Financial Agreement.
It is possible to resolve property matters or spousal maintenance applications outside of the time limitation by consent of both parties. However, if no consent is obtained, a party seeking to alter property would need to apply to the Court for property settlement or spousal maintenance. If they are outside of the time limitation set out above, they must seek permission from the Court. This is formally known as seeking ‘leave of the Court to proceed out of time’. The party making the application must demonstrate that: either:
- A hardship would be caused to themselves or their child/ren if they are not allowed to apply; or
- At time of expiry, they would have been unable to support themselves without a government benefit such as an income tested pension, allowance, or benefit.
The power of the Court to grant leave to proceed out of time is discretionary. Therefore, in order to protect their financial interests, parties should not assume that it would be granted, and should ensure that property matters and spousal maintenance are dealt with as soon as possible and prior to the expiry of the time limitation applicable.
We recommend that parties obtain legal advice as soon as possible following separation and prior to the expiry of the time limitation.
by Amy Lowry | Apr 4, 2024 | Insights
Appointing an executor needs careful consideration and planning, but what happens if the executor you decide on is domiciled in another country and non-resident of Australia?
The Australian jurisdiction has specific taxation laws when concerning inheritance and can have significant implications on foreign executor’s as well as the beneficiaries of the estate. There are distinct disadvantages of appointing a non-resident Executor in Australia.
The disadvantages of appointing a foreign executor can create issues in the areas of practicality and taxation.
The issue of practicality creates the obvious hurdle of physical proximity between jurisdictions. Administering an estate usually requires detailed completion and execution of documents in the presence of a qualified witness. Further, there is the task of physically attending to estate administration requirements, such as assessing estate assets and sale of same. This can be a major hurdle where an executor is not present in Australia. This can create barriers in punctual and effective estate administration. In addition, differing time zones and potential language and cultural nuances can impede the flow of administration and contact between the executor and third parties assisting in the estate administration.
The second issue of taxation is probably the most significant implication to consider. Australian residents who dispose of real property can enjoy taxation benefits in most cases, however, if the executor is deemed a foreign resident, then those tax benefits might not be available.
For example, when dealing with real property the executor may have a Foreign Capital Gains Withholding Tax applicable to the sale of real property that exceeds $750,000. Furthermore, if the executor is classed as a foreigner for tax reasons, then the estate may be treated as such and be excluded from accessing the tax-free threshold.
Another added layer of complexity is associated with Trusts created under Wills. If the executor is a foreign resident, then the Trust created under the Will can be treated as a foreign entity for the purposes of Foreign Investment Review Board approval to transfer real property to the Trust.
While appointing a foreign executor is not prohibited in Australia, it does come with significant implications and effective administration requires a firm understanding of the Australian legal landscape. Therefore, if a foreign executor has been appointed, it would be highly recommended to appoint another executor who is an Australian resident to aid with the effective administration of the estate and as to avoid the issues addressed above.
by Amy Lowry | Feb 29, 2024 | Insights
Make sure you get documented release upon your exit.
When a director decides to exit a business, partnership, or joint venture their obligations will not automatically cease upon their exit, especially where a personal guarantee has been provided. Therefore, careful consideration needs to be given to the potential legal and financial aspects of exiting a company or partnership. This article highlights the importance of obtaining documented release from personal guarantees and potential implications for the exiting party.
Understanding a personal guarantee
In simple terms, a personal guarantee is a legal promise made by an individual (“the Guarantor”) that they will meet and perform the obligations of a third party if that third party is unable to repay a debt. In a commercial context, personal guarantees are associated with creditors (e.g lenders), leasing, or other contractual obligations and are commonly used where the lender deems the borrower as an elevated risk. Therefore, a personal guarantee acts as a safeguard mechanism against the debt for the lender.
Personal guarantees are not all the same, so it is crucial that the guarantor understands the level of debt that the third party holds, as well as understanding the legal implications of providing a guarantee. Once a joint venture or partnership has been dissolved, or a director decides to resign, if a guarantee has been provided their legal obligation might not cease upon the dissolution or resignation. Generally, there is no time limit on a guarantee which makes it critical to obtain documented release from the guarantor. To be released, the guarantor must make a request to the creditor and any other party to the arrangement. For example, upon a director’s resignation the director can contact the lending party to request a release or request an incoming director to continue with the guarantee providing all parties provide consent.
Documented release and implications
To make the release legally binding the parties will need to reduce the agreement to a Deed which will act as both a protective measure from disputes and formalise the closure of the agreement which then discharges the guarantor’s obligation. Another important reason why documented release ought to be obtained is that personal guarantees can impact an individual’s credit history. If the lender calls on the guarantee after the dissolution of the partnership, or the director has exited, and a Deed has not been executed then the ramifications to the individuals borrowing capacity will most certainly be impacted.
Documented release from personal guarantees allows for clarity and certainty for all parties involved, which aids in reducing potential misunderstandings. Thus, making the process a necessity for business exits. Prioritising documented release will protect against legal pitfalls and protect an individual’s financial wellbeing post severing business ties.
If you require further advice on how to obtain documented release or how a personal guarantee interacts with your business, or other commercial matters, then our office can assist you.
