The need for residential care for the elderly is growing. This care has to be paid for, and so many elderly New Zealanders (or more usually, their children) are applying to the Ministry of Social Development for residential care subsidies. The process sees you wading through paperwork and digging around for copies of ancient records, before you finally send off your application and hope for the best. Then you may receive a letter from the Ministry, which says something about “a Court decision” and how it “clarified what may be considered asset deprivation”. The letter never quite gets around to telling you which Court made the decision, or when it was made, or the actual substance of the clarification. This initial rejection may not feel very encouraging and your first instinct will probably be to give up. Don’t give up. There is no denying that it is not getting any easier to qualify for a residential care subsidy. However, it is often worth questioning the initial response. And while no victory is ever guaranteed, we have been able to help a number of clients ask the right questions and see their application through to success. If you would like to discuss a residential care subsidy application give us a call (03) 477 8080

Stress is what we might feel when trying to process more information than we normally would. Sometimes this can come in the form of a singularly large problem, but more often it involves being overwhelmed by wave upon wave of smaller problems. When you have skin in the game, it is virtually impossible to step back from the storm and assess it dispassionately. This is where we can help. Our job is not simply to magic up some paperwork and say “Sign here”. Rather, our job often involves saying: “Yes, this wheel is squeaking pretty loudly, but that’s ok – it just needs some oil. And all those balls you’re juggling? We can take those three off your hands right now. And as for the rest, we’ll help you sort those too”. When you have a lot going on, acquiring and maintaining a sense of perspective is key……though that can be much easier said than done. If you’re dealing with a number of balls in the air, and need a sounding board, then give us a call (03) 477 8080

When elderly New Zealanders apply for residential care subsidies, the Ministry of Social Development’s initial letter of response often includes reference to “a Court decision” that “clarified what may be considered asset deprivation”. The Ministry never identifies the case, but it is probably the case of the Chief Executive of the Ministry of Social Development vs Broadbent [2019] NZCA 201 . It is true that the Broadbent case clarified what may be considered asset deprivation – particularly where family trusts are concerned. But while the Ministry’s mention of the case in its letters suggests that this clarification benefited the Ministry, in fact precisely the opposite is true. What Broadbent clarified was this: The Ministry cannot simply gross up the value of the assets of a Family Trust… … calculate a notional income from that value… … and then assess your application for a residential care subsidy, as if that notional income was your actual income . Also The Ministry cannot ignore the fact that you have v alidly forgiven debts owed to you by your Family Trust… …in order to adopt a notional and constant interest rate on that debt… …and then assess your application as if that notional income was your actual income . In short, when assessing your application for a residential care subsidy, the Ministry of Social Development is required to make calculations that are accurate and precise. We can help you to make sure that it does. If you would like to discuss a residential care subsidy application give us a call (03) 477 8080

Emmy Lou Harris once sang that “Neighbours are fun, I love them everyone. We get along in sweet accord” . It’s a lovely sentiment. If not always accurate… Disputes involving people who live in close proximity to one another are difficult. You can’t ignore your neighbour’s unneighbourly antics because they live right next door to you but you are hesitant about confronting them and risking their wrath because……well, they live right next door to you. You can ask us to help. Depending on the precise nature of the issue, we may or may not be able to solve it. But at the very least, we can help you to not make things worse, by taking the heat out of the conversation. Staying calm, objective and on-topic with someone you are not getting along with is sometimes asking a lot. It's where we can help. If you’re dealing with an unneighbourly situation then give us a call (03) 477 8080

When a loved one passes away grief is experienced differently by each family, and members within each family, and administering an estate can be difficult during this time. Our role is to assist the executors in a sensitive and caring way, and to provide you with excellent legal advice. Your first meeting with Lucas & Lucas After a loved one passes, the first step is to meet with the family. Usually this will be at a time shortly after the funeral. During this meeting, we discuss the will and help the executor(s) to consider if Probate is required. Probate is the term used when someone dies leaving a will. The person(s) named in the will as the executor(s) apply to the High Court to have the will declared valid and to administer the estate. Probate gives the person(s) the authority to manage the estate. Probate is required if there is, with any one bank or investment institution, more than $15,000 or if land is in their sole name or as tenants in common. If in the unlikely event there is no will, we discuss the options available and whether Letters of Administration may be required. Probate To obtain probate, we prepare for completion by the executor(s) an affidavit for grant of Probate (with the original will as an exhibit). The affidavit can be completed at our first meeting. We then arrange for the affidavit together with an Application and the draft Probate (court order) to be file in the High Court of New Zealand at Wellington. The filing fee is $200. This is filed with the High Court by courier. The court will consider the application and this takes usually between two to six weeks for the probate to be granted after this is filed. Confirm assets and liabilities of the estate We can assist with confirming the assets and liabilities of the estate. If the person owns jointly (joint tenants) a home, this asset would NOT form part of the estate, but we assist with the legal paper work for this to be transferred to the surviving owner (known as transmission by survivorship). If the person has joint bank accounts and/or investments then again these accounts would NOT form part of the estate and we can assist with the legal paper work to advise the bank or financial institution to have these transferred by survivorship. The remaining assets in the sole name of the person would then form the estate assets. These can include any car, bank accounts, term deposits, KiwiSaver, shares, investments, real estate and other valuable items, such as collectables. As required, we can assist the executor(s) to contact the organisations, close the bank accounts and investments, sell or transfer property and other assets and assist with the legal paper work. in advising the banks and financial institutions that the person has died. This then freezes the accounts/investments until probate is granted. to understand and comply with the IRD tax requirements for the estate. The tax rate for estate income is 33%. Each estate is required to apply for an estate IRD tax number and file tax returns. The IRD estate link is https://www.ird.govt.nz/situations/im-looking-after-the-affairs-of-someone-who-has-died How long will it take? The time required to administer an estate varies depending on the circumstances of each estate. We estimate that simple and mid-sized estates usually take between twelve (12) to eighteen (18) months to complete, from the date of the grant of Probate . The length of time for estate administering varies depending on the number of assets of the estate and the number of beneficiaries. Some more complex estates can take significantly longer. We like to set realistic time frames. Where a will is challenged by a family member or there are complex assets, such as overseas property, administration may take longer. We have excellent relationships with solicitors in Australia, the United Kingdom and Canada to assist with any the administering any assets in these countries. Customer Due Diligence Please do not be offended when we request verification of identification and address. In practical terms we require proof of identification to verify full names, dates of birth and confirmation of residential address. This applies both to the executor(s) and to all the beneficiaries of the estate. All banks, financial institutions, stock brokers, lawyers and accountants are required to verify this information. The Anti-Money Laundering and Countering Financing of Terrorisms Act 2009 has placed increased emphasis on customer due diligence. We are experienced in collecting this information to streamline the administration process for the estates which we assist with the administration. For further information contact us or call (03) 477 8080

When you are appointed as an executor (and trustee) of a will it is important to understand the role. It is an honour to be asked, however the role comes with responsibilities and is time consuming and an unpaid role. As a named executor, you can either accept the position or decline the position. If you decide that you are not willing to perform the role and you have not had any dealings with the will-maker’s property after death, then you may renounce probate. This is done by signing a Renunciation of Probate document. This document is then filed with the High Court. The renunciation of Probate document is also referred to in the affidavit as the remaining executor(s) to explain why all the named executors are not applying for the grant of probate. If you are willing to perform the role as an executor it is important before you agree that you understand what you are agreeing to. ROLE OF THE EXECUTOR IS TO: Locate the original will, contacting their solicitor is usually the best option and conducting a search of their important papers. In the unlikely event that no will is located a solicitor can assist with advertising for a will with the New Zealand Law Society Will Search notices. Contact the Funeral Director for funeral arrangements in accordance with any instructions in the will. The decisions relating to the funeral are up to the executor, however a preference may be put in their will. The executors are guided by those wishes in the will together with the wishes of family. The payment of the funeral expenses has priority and is paid first from the estate. Notify banks, credit card companies and government agencies (e.g. Inland Revenue). We recommend that their bank is advised that the person has died as soon as possible . Although the bank account is frozen pending the grant of Probate the funeral expenses can be requested to be paid directly by the bank to the Funeral Director if the bank is provided with a copy of the funeral invoice and the death certificate (usually certified copies) and the executors approve the invoice for payment. My Trove is a website which allows for executors to notify some banks and government and some insurers that a person has died https://mytrove.co.nz Apply for probate, if this is required. You will usually seek legal advice about whether an application for the grant of Probate is required. This is the application to the High Court of New Zealand. See Estate Guide. The executors and trustees take a neutral position and owe a duty to treat the beneficiaries even-handedly. This duty extends to potential claimants against an estate, where an executor is aware that they may wish to make a claim The executors and trustees need to keep a record of the inventory of the estate assets and liabilities. An account of the estate (estate statements) needs to be recorded that is accurate and states the dates and details of all receipts and disbursements and details relating to the capital and revenue account (for taxation). Once probate is granted, call in the assets and pay all the debts and the funeral and testamentary expenses. Maintain any property until it can be distributed or sold. Have prepared and file the required personal and estate income tax returns and pay any tax owing. Distribute the estate in accordance with the terms of the will. IMPORTANT POINTS Both Powers of Attorney and Enduring Powers of Attorney (Property and Personal Care and Welfare) CEASE ON DEATH . If personal chattels have not been mentioned separately in the will, then those items form part of the residuary estate. If Probate is required, then once Probate is granted, the will which is attached to the Probate document becomes a public document and anyone can request a copy from the High Court of New Zealand, Wellington upon payment of a fee. An executor may receive a request for a copy of a will before Probate is granted or applied for, by a potential beneficiary. We recommend that it would be prudent for the executor to provide a copy of the will in case there is to be a challenge to the will. If the person had a joint bank account(s), the account is not frozen and the bank will be able to transfer the account into the sole name of the surviving account holder once the death certificate is available. If the person had a house, then make sure that the property is insured and if the house is unoccupied that the unoccupied status has been notified to the insurer and this is confirmed in writing to the executor. The insurer will have a number of requirements for unoccupied homes which will need to be complied with. Also, the local council and regional council should be advised of the death and you should check that the rates payments are up to date. If the executor does not apply for Probate within three (3) months of the death then one of the beneficiaries can apply to the High Court to be appointed as Administrator. This is not usual and is a complex process. Executors need to be aware of the “Executors Year”. The time required to administer an estate can vary depending on the circumstances of each estate. We estimate that simple and mid-sized estates usually take between twelve (12) to eighteen (18) months to complete, from the date of the grant of Probate . However, estate administering can take longer depending on the number of assets of the estate and the number of beneficiaries. An executor can be appointed as an executor and also be a beneficiary of the will. If you do not accept the role of executor, this does not affect receiving any inheritance in the will. It is important that executors take legal and accounting advice where necessary. Once Probate is granted, if the estate is modest, the executor(s) and trustee(s) of the estate may prefer to carry out the terms of the will, without the assistance of solicitors, to keep the legal costs to a minimum, seeking legal advice when necessary.

Susan* called to see us with bank loan and mortgage papers. She had agreed to be a trustee for Bob*, her brother’s trust. She presented with over thirty pages of small print to read. She wanted to know what risks there might be for her in signing the bank papers. Many people are asked to be trustees for family and friends so Susan’s important question is topical. The bank forms limited her personal liability but that was not the end of the story. Susan needed to know that her brother, Bob, a builder was not also lending money to the trust either personally or through his company. If the trust did have other debts she may be liable to her brother’s creditors if the trust assets became insufficient. Although Bob was building a home for himself and his new partner, Susan also had to be sure that the equity wouldn’t be used to finance the building business. Any stress at that end might require the house to be sold, and being a builder, leave Susan with unfunded tax to pay. In this case Bob’s lawyer had things well in hand. There was a distinct limit on the loan. The other trust funding was by cash gift, there were no other debts, and Bob’s building company was personally owned by him, and a proper resolution was prepared to record the transactions. It wasn’t my concern, but Bob and his new partner also had properly documented their expectations of each other. If you are a trustee, you do have to ask nosey questions, you do need to see the trust accounts, you do need to know what your duties are and you can’t delegate decisions to other people. * Names have been changed. For further information contact us or call (03) 477 8080

If you love the house, we want you to get it. If you’re selling your house, we want it to go smoothly. Buyers If you’re climbing the property ladder or if you’ve found the house you love, we’re here to help you make this house your home. Who’s name should your house be in – and if you’re in business, this decision may be crucial. Finding finance & Property checks – we can point you in the right direction. KiwiSaver – assistance with the application and obtaining your KiwiSaver. Relationship Property – defining your rights. Sellers Real estate agents have the sales expertise; they know the current market and are skilled in presenting your house to its best advantage.  We’re here to make sure all the “i’s are dotted and t’s are crossed” and all papers are in order so your sale is smooth & stress free! Electrical & Building Valuation HP Charges Council Records Titles Your money to the bank! Anyone can deal with the simple things but it’s important to do these things well. If something comes up, or there’s a wee bump in the road, it’s our job to straighten it out for you. For further information contact us or call (03) 477 8080

What is an Enduring Power of Attorney and what does it actually do? Enduring Powers of Attorney were first introduced in New Zealand in 1988, and they have made a big difference to the way we approach elder care - for the better! By having these in place it allows other people to make decisions on your behalf. Why is it called an “Enduring” Power of Attorney? They are called “enduring” powers of attorney because they continue to have effect even after a person loses mental capacity. This is the very time when people need care. Do I need Enduring Powers of Attorney? For most people the answer will be a simple “YES”. It is always good to have your affairs in order and to have proper arrangements for the future. Enduring Powers of Attorney give you control over who will look after you and how your affairs could be managed. It’s all about peace of mind. Enduring Powers of Attorney assume more importance today because organisations have burgeoning legal concerns about respecting privacy. You do not ever want your “privacy” getting in the way of the right people being informed and listened to. Another reason for having Enduring Powers of Attorney is that this gives your family a focal point for decision making. We are often asked about whether other family members can be consulted, and of course they can. But it is important to have someone to act as the decision maker too. What kind of decisions could be made on my behalf? There are two types of Enduring Powers of Attorney, and most people have both. One type is for Personal Care and Welfare – Your attorney can make decisions about your welfare, care and wellbeing if you lose mental capacity. The most common decisions relate to living arrangements and health care treatment. The other type is for Property – Your attorney can look after your property and finances. Commonly this involves managing bank accounts, paying bills, and committing to a suitable residence for you. You can decide whether you would like your attorney to have immediate power or only if you lose mental capacity. How many attorneys can I have? You may only appoint one attorney to act at any one time for Personal Care and Welfare . However you can appoint as many successor attorneys as you wish. For Property , you can appoint any number of attorneys and successor attorneys. If you appoint more than one attorney you can also instruct that they have to act together. There are some matters that you attorney cannot decide for you, for example they cannot make decisions for you on marriage or divorce, or consent to you being part of a medical experiment. Who should I appoint as my Attorney? Your attorney should be someone you can trust, someone who understands you, and someone you know will act upon your best interests and wishes. If you are married or have a partner, it is permissible to choose each other, and most people do that. Otherwise you can choose a family member or a close friend. When should I make an EPOA? Most people make Enduring Powers of Attorney nowadays when they see us about making a Will. That begs the question, when should I make a Will. Any time is a good time for both, and the sooner the better! What happens if I don’t make Enduring Powers of Attorney and I can’t manage my own affairs? Someone may have to apply to the Family Court on your behalf. If this is needed, a welfare guardian and/or property manager will be appointed by the Judge. The biggest issue with not having Enduring Powers of Attorney is creating avoidable stress for family members or loved ones trying to look after you. Moreover, applying to the Family Court can be a very costly exercise, and it takes TIME. While you wait for a court order to come through it is difficult for anyone to act. Even simple tasks like paying your bills can become a headache. What other matters do I need to ensure my personal affairs are in order? The usual things that people review are Wills, Enduring Powers of Attorney, and any Trust documentation. An asset planning issue could be whether there is any possible claim against your estate. Another concern for many people, especially as they age, is eligibility for rest home care subsidies. If you are married or in a relationship it is often a good idea to consider the combined effect of both your Wills, particularly where one or both of you are in a second relationship. Some couples choose to enter into contracting out agreements. Such agreements obviously set out what happens in the event of a relationship breakdown. Furthermore, they can impact significantly on what happens when each person dies. For anyone looking at their personal affairs it is important to address any potential clashes of interest between family members. Family trusts often play a role in helping parents preserve assets for their children. If you control a family trust, you can and should review what will occur on your death. One of the issues is who the trustees will be and how they will be chosen. Another question is whether the trustees who come after you have enough of an understanding to administer the trust. Most settlors will leave a memorandum of wishes, and documents of that kind should be reviewed from time to time. For further information contact us or call (03) 477 8080

Why we need to ask you for information New Zealand has passed a law called the Anti-Money Laundering and Countering Finance of Terrorism Act 2009 (“the AML/CFT law” for short). The purpose of the law reflects New Zealand’s commitment to the international initiative to counter the impact that criminal activity has on people and economies within the global community. Recent changes to the AML/CFT Act mean that from 1 July 2018 lawyers must comply with its requirements. Lawyers must do a number of things to help combat money laundering and terrorist financing, and to help Police bring the criminals who do it to justice. The AML/CFT law does this because the services law firms and other professionals offer may be attractive to those involved in criminal activity. The law says that law firms and other professionals must assess the risk they may face from the actions of money launderers and people who finance terrorism and must identify potentially suspicious activity. To make that assessment, lawyers must obtain and verify information from prospective and existing clients about a range of things. This is part of what the AML/CFT law calls “customer due diligence”. Customer Due Diligence Requirements Customer due diligence requires a law firm to undertake certain background checks before providing services to clients or customers. Lawyers must take reasonable steps to make sure the information they receive from clients is correct, and so they need to ask for documents that show this. We will need to obtain and verify certain information from you to meet these legal requirements. This information includes: • Your full name; and • Your date of birth; and • Your address. To confirm these details, documents such as your driver’s licence and your birth certificate, and documents that show your address – such as a current bank statement – will be required. If you are seeing us about company or trust business, we will need information about the company or trust including the people associated with it (such as directors and shareholders, trustees and beneficiaries). We may also need to ask you for further information. We will need to ask you about the nature and purpose of the proposed work you are asking us to do for you. Information confirming the source of funds for a transaction may also be necessary to meet the legal requirements. If you cannot provide the required information If we are not able to obtain the required information from you, it is likely we will not be able to act for you. Because the law applies to everyone, we need to ask for the information even if you have been a client of ours for a long time. Before we start working for you, we will let you know what information we need, and what documents you need to show us and let us photocopy. For further information contact us or call (03) 477 8080

Trustees can find it extremely annoying when they want to resign but no one will cooperate. This can be a really tricky situation to work through. In one case, a trustee decided he wanted to resign because the family politics were getting heated. He had originally agreed to get involved as a favour to a cousin. Now the whole thing was turning into a major hassle. Trustees must know what is going on, and it’s unsettling if you feel that you can no longer trust the other trustees. No one wants to end up in a pickle over someone else’s affairs. Going to court to get out of being a trustee was a really daunting prospect for our client. However, we guided him through the process and he was able to be replaced. And, the court also ordered the other party pay our costs. A very good outcome for our client! For further information contact us or call (03) 477 8080

Tell your advisors exactly what you want to achieve out of the deal. If you want ensure that a shareholder-employee will stay, then make sure your advisors know this so they can be thinking about how to ensure that objective. If you are looking for a source of capital, your advisors need to be thinking about what strings will be attached. If you are looking to start a succession plan, your advisors need to be thinking about how this sale might fit into the broader picture.   We spend time listening to what clients want, and then we so we are better able to offer insights from our experience about what can be done to get there. Clarify precisely what you expected from the new shareholder. Misplaced expectations are a huge catalyst for disputes. It is a great idea to write all the important things down in your agreement. We like to record the parties’ background, how they got to this point, what they ‘expect’, and how they envisage the relationship will pan out in the future. That way, the agreement becomes a useful reference point for ‘what we did say at the start’. There are three big issues that any Shareholder’s Agreement must cover: i) Who is going to be in charge?                                Who will the directors be? Who can vote in new directors? What is the formal chain of command? How much ‘say’ can the newcomer expect? ii) How will you cope with a dispute?                                Methods include court resolution, arbitration, and mediation. Mediation, arbitration and court resolution. See point 4 below for more on this. iii) How will (either of you) get your money out?                                In a practical sense, having ‘liquidity’, i.e. the ability to sell, adds real value.   When people go into business together, the mood is often euphoric. The parties just want to get on, and get the deal settled. They will say ‘Disputes? What disputes? We will get along fine.’ The trouble is that when a dispute arises, trust usually breaks down, and then one side will try to hold the other to ransom. Often it is just too expensive to go to Court, or to arbitrate, and the parties are left having to accept the status quo. One way to avoid this is to have a mechanism that allows a buy-out on an agreed formula. Having an ‘out’ if things don’t work out is the best insurance that you will actually get along fine. For further information contact us or call (03) 477 8080