The pitfalls of lending money to a friend or relative
Lending money to a friend or relative can be a risky proposition, and there are several potential pitfalls to consider before making such a loan. Some of the common pitfalls include:
1. Strained Relationships: If the borrower is unable to repay the loan, it can cause tension and strain in the relationship with the lender.
2. No Repayment: There is always the risk that the borrower will not repay the loan, leaving the lender without the funds they lent.
3. Lack of Documentation: Failure to document the loan with a formal agreement can lead to misunderstandings or disputes about the terms of the loan.
4. Legal Action: In the event of non-payment or breach of loan terms, legal action may be required to recover the funds. This can be costly, time-consuming, and may damage the relationship further.
If a friend or relative refuses to repay a loan, or if they encounter financial difficulties that make it difficult to repay the loan, the lender may have legal recourse available to them in South Australia. These may include:
• Negotiation: In many cases, it may be possible to negotiate a repayment plan or a settlement that is agreeable to both parties. This can help to avoid the matter ending up in Court and can preserve the relationship.
• Legal Action: If negotiation is unsuccessful, the lender may be able to pursue legal action to recover the funds. This may involve filing a claim in the Magistrates Court (debts of less than $100,000) or the District Court (debts greater than $100,000).
• Security: If the loan is secured by collateral, such as property or a vehicle, the lender may be able to take possession of the collateral in the event of default.
• Guarantor: If a third party has guaranteed the loan, the lender may be able to pursue legal action against the guarantor to recover the funds.
It is important to note that legal action can be expensive and time-consuming, with no certainty of a favourable outcome. A lawyer experienced in debt recovery matters can assess your options and determine the best course of action.
If you decide to enter into such an arrangement, it is also prudent to have a written loan agreement in place that sets out the loan terms, including a repayment schedule, the interest rate, and any security or guarantees. A lawyer can also draft this agreement.
For further information about dealing with civil disputes please follow the link HERE
*This information is current at the time of publication. For accurate legal advice, please contact Scammell & Co on 08 8440 270.
Generic legal documents are readily available online. So why engage the services of a lawyer?
Over the past few years there has been a boom in the online legal document business. You can now download a wide variety of legal documents off the internet including a will, a contract or lease - even a divorce form, for a fraction of the cost of engaging a lawyer to draft one.
At first glance these online documents seem to offer convenience and value for money, but it is a case of buyer beware! Downloading and using generic legal documents or forms gives the false impression that the document will be fit for purpose. However, their use could end up costing you more in the long run, be ineffective in accomplishing your aims, and be unenforceable in the event you end up in court over a dispute.
For example, generic online legal documents can be out of date or flawed, and the companies which sell them make no warranty that their products and services will be fit for purpose. Misguided or incorrect assumptions can be made by the purchaser as to the use of certain phrasing, or the necessity of certain clauses or policies in such documents, which can put them, their assets or their business interests at unnecessary risk or cause reputational damage. There is also a tendency when using off-the-shelf documents to simply adjust the circumstances to fit the document, however, legal issues are rarely straight-forward. Engaging the services of a lawyer provides clients with peace-of-mind knowing their unique circumstances have been considered, and the legal documents have been customized to meet their specific needs.
Many websites also offer access to a virtual lawyer however, this adds to the cost and can be problematic in that you may not be getting the best or most appropriate legal help. For example, the lawyer is not one of your choosing, they may not possess a suitable level of expertise in law relevant to your matter, nor be familiar with the laws of your jurisdiction.
Scammell & Co have experienced lawyers who can answer your questions, provide you with tailored advice and services on all aspects of contracts, leases, and other documents to ensure they meet your specific needs, mitigate risks and protect your assets.
For further information on how we can assist you with your contracts, leases and agreements click HERE
*This information is current at the time of publication. For accurate legal advice, please contact Scammell & Co on 08 8440 270.
Your options if you find yourself in a strata title development dispute
It is estimated that one in five Australians live in strata title properties.
Collectively, these properties comprise a strata scheme which refers to land and buildings divided into two or more units, apartments, or townhouses. Owners have title to a ‘lot’ (or a ‘unit’ as it is referred to in South Australia), with shared access to, and responsibility for, any common property.
Each development forms a strata corporation when a strata plan is lodged with the Land Titles Office. This entity operates in accordance with both the Strata Titles Act 1988 (SA) and the Community Titles Act 1996 (SA) (the Act), as well as the scheme’s by-laws (rules). It also acts on the will of the owners as articulated through voting at general meetings or, for day-to-day matters, through an elected executive committee.
The responsibilities of the strata corporation include:
- Financial management of funds raised through strata levies;
- Maintaining strata insurance;
- Record keeping;
- Repairs and maintenance of common property;
- Maintaining, updating, and enforcing by-laws;
- Engaging the services of a strata or building manager; and
- Keeping up to date with, and adhering to, applicable laws relating to planning, building, and work, health, and safety.
Given the growth and popularity of strata schemes in Australia, and the differing interests of owner occupiers, investors, and tenants, conflicts are increasingly common. The type of disputes that arise between neighbours, or between an owner or tenant and the strata corporation include:
- excessive expenditure;
- lack of knowledge of, or compliance in, the strata laws;
- unauthorised encroachments;
- disturbances or intrusions;
- pets; and
- parking.
There are several ways of dealing with disputes in strata schemes.
In the first instance, the strata secretary or manager will attempt to address the problem. If it is claimed that a unit owner or tenant is in breach of the strata corporation’s articles, the corporation may request that the person either do what is required under the articles, or stop doing what is not allowed under the articles. If the person continues to breach the articles, mediation may be sought, or a penalty may be imposed by the corporation if there is provision for this in the articles, and/or the matter may be taken to court.
The Magistrates Court (for minor civil action), or the District Court (for more complex matters), will deal with disputes where:
- it is claimed a breach of the Act or the articles of the corporation has occurred;
- an occupier of a unit claims to have been prejudiced by the wrongful act or default of the strata corporation, or an agent (including a strata manager), or the executive committee, or some other member of the strata corporation;
- a member of a strata corporation claims that a decision of the strata corporation, or a delegate (including a strata manager), or the management committee is unreasonable, oppressive, or unjust; or
- any aspect of the occupation or use of a strata unit is in dispute between a strata corporation and a member of the corporation, or between two or more members of a strata corporation.
The court may reach the following binding decisions:
- order a party to do something, or refrain from doing something;
- decide on the validity of an article or decision made by the corporation;
- order articles of association be altered;
- reverse decisions made by the corporation;
- vary or terminate a contract made between a strata corporation and a strata manager;
- award money as damages or compensation.
Failure to comply with an order is an offence carrying a maximum penalty of $2,000.
Anyone considering legal action should be aware of potential limitations periods and is advised to seek independent, professional advice from a Scammell & Co lawyer as early as possible.
*This information is current at the time of publication. For accurate legal advice, please contact Scammell & Co on 08 8440 270.
Mediation is an effective option for resolving disputes
To resolve a dispute, the parties involved may reach an impasse and turn to the legal system for help. Accordingly, many people believe the only lawyers option to resolving a dispute is to initiate a lawsuit. However, there are other avenues, which lawyers have a professional obligation to offer clients, that may lead to an acceptable outcome.
Mediation is one such option which is suitable for various cases including:
Mediation has proven to be a successful process for resolving disputes. For this reason, the court system has the power to order parties into mediation prior to going to court, if they have not done so voluntarily.
A less formal process than court proceedings, mediation is conducted by a neutral third person, known as a mediator. The mediator is usually someone trained and accredited by the Court and ideally possesses good conflict resolution and negotiation skills. Depending on the nature of the dispute a mediator may also be an expert in a particular field. Unlike a judge, a mediator won’t decide on the outcome of the case. Instead, mediation is designed to empower the disputants through a process of discussion, negotiation, and mutual agreement - with the aim of avoiding the cost, time, stress, and risks associated with formal litigation.
Mediation is a multi-stage process with most proceeding as follows:
The mediator begins by providing a universal statement about the nature of the dispute. They will also explain the goals and rules of the mediation, and to get the most out of it, encourage all parties to conduct themselves in a civil, professional, and constructive manner.
Each side then takes it in turn to present their opening statement – delineating their version of the problem. The mediation itself is flexible and can be tailored to the circumstances. Mediators may assist proceedings by asking questions, encouraging open discussion, offering different perspectives, and expressing issues in alternative ways.
If not already done so, the mediator will require a concise detailing of the facts, evidence and any other relevant information that may help them formulate ideas and proposals that meet each party’s core interests. The mediator can lead the negotiation with all parties in the same room, or they can split them up and engage in “shuttle diplomacy,” moving back and forth between the parties. It is important for both parties to enter negotiations with a clear understanding of their settlement proposal – and be prepared to reach a mutually beneficial compromise, if necessary.
The length of time mediation takes to reach an agreement (in full or in part) depends on the complexity of the issue and the willingness of the disputants to work together for the common good. Straightforward cases can potentially resolve in half a day. More complicated cases will require at least a day – but possibly more.
The details of an agreement will usually be recorded and signed by all parties before the end of the mediation.
*This information is current at the time of publication. For accurate legal advice, please contact Scammell & Co on 08 8440 270.
In a dispute over a breach of contract? Here are your options.
A contract is a legally binding agreement between two or more parties that sets out the obligations and expectations of the relationship or transaction. Most commercial and consumer dealings are regulated by a contractual agreement.
There are three basic elements to a contract. Firstly, there must be an agreement between the parties where one party offers something, which the other party accepts. Secondly, each party must give something of value such as money, goods and services, skills, or labour. Thirdly, each party must have willingly entered into the agreement.
Not all contracts have to be in writing, however, to avoid misunderstandings that can lead to disputes, it would be prudent to have a written contract. In certain circumstances it is a legal requirement that contracts are in a written form.
Depending on the type of breach the contractual obligations may be repudiated by the other party to it. An example of repudiation is where a party openly states that they are either unwilling or unable to perform their obligations under the contract. A party’s conduct can also amount to an act of repudiation.
If a contractual breach occurs by one party, the party that is not in default can take three actions:
- they can sue for specific performance, which includes a court order directing the party that is in default to carry out its contractual obligations.
- they can seek an injunction, which is a court order restraining a party from breaching the contract.
- they can sue for monetary compensation (known as “damages”) for any loss resulting from the breach of contract.
Irrespective of which side of the dispute you find yourself, a Scammell & Co dispute resolution lawyer will support you through the process. This includes:
- providing legal advice and workable options to protect your interests;
- handling negotiations;
- conducting mediation; and if all else fails,
- representing you before a relevant court.
A Scammell & Co lawyer has the experience to safeguard your rights and resolve disputes as quickly and amicably as possible to avoid you incurring further losses.
For further information about our legal services relating to contracts, leases and agreements, please click HERE
*This information is current at the time of publication. For accurate legal advice, please contact Scammell & Co on 08 8440 270.
Giving evidence in a court of law is a serious undertaking. Here are the key considerations.
If you have received a summons or subpoena to appear as a witness in a criminal or civil trial, then you are required to attend court. If you do not attend court at the listed date and time and without a reasonable excuse, then you may be charged with contempt of court or a warrant may be issued for your arrest. As the schedule for trials will often change, you should contact the party that has called you as a witness prior to the listed date and time, to confirm your attendance.
As a witness, it is likely that you have previously provided a written statement to the party that has called you as a witness in the case. Prior to giving your evidence in court, read over your written statement and refresh your memory in respect of the event that you will be questioned about. For example, when it occurred (the date and time), what you saw or heard and who was present. If any part of your statement is incorrect, then you should inform the prosecution or defence right away.
When you arrive on the day, you will need to wait outside of the courtroom until the court is ready to hear your evidence. As you cannot wait inside of the courtroom, you may bring a book, magazine or mobile phone to occupy yourself while you wait. If the court cannot hear your evidence on that day, then you may be required to return to court on another day.
When it is your turn to give evidence, you will swear an oath or make an affirmation to tell the truth. First, you will be asked questions by the party that has called you. This is called examination in chief. Then, you may be asked questions by the other party in the case. This is called cross examination. You may then be re-questioned by the party that has called you before being released as a witness.
After your evidence is given, you can leave the court or remain in the public gallery of the courtroom to observe the remainder of the evidence being given.
You must tell the truth when giving evidence. So listen carefully to the questions, ask that the question be repeated if you did not hear it, do not feel pressured to answer quickly and do not guess the answer if you do not know. It will also assist the court if you answer the questions in a clear and loud voice.
A person who knowingly makes a false statement under oath or affirmation may be charged with an offence carrying a maximum penalty of 7 years imprisonment.
For information about Scammell & Co.'s Civil Litigation services and the dispute resolution process click here
*This information is current at the time of publication. For accurate legal advice, please contact Scammell & Co on 08 8440 270.