Think before you post!

share buttonby Travis Schultz

Social media can be a very useful tool to enable business operators to stay in touch with their networks and promote their products and services, but as a swimwear designer recently found out, it can be an expensive form of marketing if you are not careful about what you post!

The recent Federal Court case involved a swimwear designer from a fashion label “White Sands” who felt that some of her designs of ladies swimwear had been copied by a large designer “Seafolly”.  After seeing the Seafolly designs exhibited at a fashion show, she posted on her personal Facebook page an album entitled “The Most Sincere Form of Flattery?”  The album then showed models wearing Seafolly garments under which the White Sands designer had inserted the name of her own garment followed by a question mark.  She also posted photographs of models wearing her own White Sands garments alongside the Seafolly ones with a caption “White Sands as seen at the RAFW in May – Seafolly September 2010” or “White Sands 2009 – Seafolly 2010”.  The White Sands designer also approached a number of media outlets alleging that Seafolly had copied her designs.

The Federal Court of Australia, in handing down its decision, found that Seafolly had not copied the designs of White Sands and found that there had been misleading and deceptive conduct on the part of the White Sands designer which breached the Trade Practices Act and ordered her to pay $25,000.00 in damages.

When you also add in the cost of litigating in the Federal Court, you would have to think that the White Sands designer might now have second thoughts about venting on social media in the future.

The lesson for anyone in business is quite simple – if you wouldn’t put your comments on paper and sign it, then don’t say it in social media as any publication of factually inaccurate and potentially inaccurate material can expose you to a claim in damages.

Feel free to swear at the boss!

SwearingBy Travis Schultz

In a decision that some employers might think is unfair, Fair Work Australia has ordered the reinstatement of an employee of Linfox Armaguard who had sworn aggressively at his manager while carrying a loaded gun and subsequently stormed out of a meeting.

The employee, a security officer, was reportedly sacked by Linfox Armaguard after the incident in which he voiced his displeasure about his roster and being assigned to an Armaguard van that he considered to be faulty and told his manager to “Get F….ed”.  He then launched into a tirade about the “F…ing roster” and aggressively pointed at a notice board before storming out of the monthly meeting.  Although the employee apologised in writing the following day, he was sacked and then applied for reinstatement through Fair Work Australia (“FWA”).

In handing down its decision, FWA considered that the sacking was harsh even though the conduct of the employee amounted to “misconduct”.  FWA considered that the swearing had not been overheard by any other employee and therefore didn’t undermine the authority of the manager and took into account the fact that the employee had been involved in an argument with his wife before he arrived at work.

The employee was ordered by FWA to be reinstated, but with the loss of six weeks’ pay as a penalty.

If, as in this case, the workplace is one where swearing is commonplace, then a dismissal based on the use of offensive language will often be difficult to justify.  The outcome may have been very different if the workplace was one in which there was a well established culture that did not tolerate swearing and as a result, the decision probably doesn’t mean that in all circumstances, it’s okay to swear at the boss!

What’s on your Bucket List?”

STO-107by Cec O’Dea, Partner

One thing to do before you die….

Studies show that up to 45% of the population don’t have a valid Will.

It’s an outstanding statistic when you consider the consequences of not taking the time to prepare an estate plan and keep it updated.

An estate plan typically involves more than just a Will to provide for the distribution of a person’s property and assets upon their death.

People often don’t appreciate what assets actually form part of their estate  and what assets are “controlled” by their Will.

If a person’s financial and family affairs are fairly basic, their Will may be all that is required for that individual.  This, however, seems to rarely be the case with various considerations usually needing to be addressed such as:-

  1. How are jointly owned assets (such as the family home, shares and bank accounts) to be dealt with?
  2. How are assets held in a private family company to be treated?
  3. Who is to end up in control of assets held in a family trust?
  4. What is to occur if a surviving spouse was to remarry?
  5. Who will receive the proceeds of any life insurance?
  6. How can a person “guarantee” that children will be looked after?
  7. How can a person provide for a spendthrift or disabled beneficiary?
  8. How should the various competing interests caused by a second marriage and other “blended family” arrangements be dealt with?
  9. What will happen to a person’s business interests?

In particular, clients are often surprised to learn that their superannuation (irrespective of whether it is within a self-managed fund or not) does not form part of their estate. It should usually be dealt with by a Death Benefit Nomination.

In one recent case the Court held that the daughter of the deceased had not acted improperly by taking control of what was essentially her father’s self managed superannuation fund and refusing to pay benefits from the fund according to
wishes expressed by her father. A properly completed nomination could have avoided this outcome.

In many cases, superannuation represents a significant proportion of a person’s assets as people seek to accumulate wealth for retirement in the tax favourable superannuation arena.

Superannuation will continue to be increasingly relevant in light of recently proposed legislation to incrementally increase the Superannuation Guarantee rate from 9% to 12% in coming years.

Even where a person has only been in the workforce for a short period of time and their employer contributions are viewed as minimal, there may be an insurance component attaching to a person’s superannuation of several hundred thousand dollars which is also payable in the event of their death.

Problems can also often arise in estate matters where there has been a breakdown of a relationship and a person’s affairs have not been updated.

People often misunderstand the effect of being separated but not divorced from a spouse.

A lot of the problems that are often encountered in estate matters can usually be avoided so make sure one of the things on your “bucket list” is the important step of having an up to date estate plan.

Red Knot Chardonnay 2012

Shingleback Red Knot Chardonnayby Travis Schultz

While the McLaren Vale in South Australia is best known for its ripe spicy berry Shiraz, some vintages from the region also produce very good whites, and 2012 was definitely one of those years.

The beauty of the McLaren Vale is that when Mother Nature is kind to the vignerons, you don’t have to pay the earth for a premium level wine.  Take, for example, the 2012 Red Knot Chardonnay which is produced by the Davey Family owned “Shingleback” Estate.

There’s not a lot of depth of colour in the glass but upfront there are hints of the typically ripe peach and watermelon flavours that are synonymous with McLaren Vale Chardy, but winemakers Kym and John Davey have blended 10% Semillon fruit to the current release to produce a clean, crisp “green gooseberry” style finish to balance the ever so slightly nutty and oak characters that show across the mid palate. It’s not one over those heavy over-oaked types that have turned consumers away from the Chardonnay brand and there’s a good lashing of acid which tends to control the fruit in a way that is reminiscent of a good WA SSB (Semillon Sauvignon Blanc).

At the $12 to $15 price point, the 2012 vintage is punching well above its weight and I reckon that it’s the best Red Knot Chardonnay we’ve seen in recent years.  It’s a drink now style but well worth keeping an eye out for.

Buy local and keep our farmers for our food future

AustraliaBy Travis Schultz

The recent failure of the iconic Australian food brand Rosella, sounds a dire warning for the future of the Australian fresh produce processing industry.  When Gourmet Food Holdings, the parent company of Rosella, was placed into receivership at the end of November last year, it reportedly owed about $50 million to its major security creditor, the National Australia Bank.  This spectacular collapse follows that of another Australian vegetable company, Premium Fresh which went into administration earlier last year owing about $10 million to unsecured creditors who were primarily vegetable suppliers.

No doubt a major factor in the collapse of these food processing companies is the extremely high Australian dollar which makes it very difficult for processors to compete against relatively cheap international imports but it must also raise a question mark over the ability of the Australian fresh food and produce sector to feed the country in the longer term.

While there will always be a market for fresh fruit and vegetables, it is not always going to be possible for producers to access that market and, given the highly perishable nature of their produce, when supply is high but outstrips demand, the processing sector is really the only remaining option in terms of a market.  If the processing sector disappears it seems inevitable that large quantities of perishable stock will potentially be lost.  When farmers lose that revenue there must be some who are placed at serious financial risk.  If our fresh produce farmers collapse, are we then left to rely primarily on international producers to feed the nation?

Perhaps it’s time Australian consumers were educated on the risk to our farmers and the primary production sector, and of the need to buy local?

Franchisors must register security interests

Travis SchultzBy Travis Schultz

The newly enacted Personal Property Securities Register (PPSR) has created a convenient ‘one stop’ register for the recording of security interests in a range of different types of property but in the business world, confusion often exists as to whether or not a particular security interest must be registered.

While it seems to be well known that security interests over motor vehicles or fixed and floating charges over company assets need to be registered, many business owners who conduct franchise operations are unaware of the need to register their interests where they sublease premises or supply equipment or gives licenses to others to use its intellectual property.

As a result of the PPSR expanding the definition of “Security Interest”, where a franchisor retains a long term lease, leases goods or products to a franchisee, provides stock or goods to a franchisee on credit, or even buys goods from a supplier on credit, they will need to ensure that their interest is registered on the PPSR.  A failure to do so will mean that the franchisor may lose the protection of having a registered security interest.

For example, where a franchisor provides stock or equipment to a franchisee, and licenses them to use it, unless their interest is registered on the PPSR, in the event of the franchisee’s insolvency, the franchisor may lose the ability to claim title to the goods if receivers were appointed.  The same situation applies to circumstances in which a franchisor provides stock to a franchisee to sell on a retention of title or consignment basis.  Unless the franchisor’s security interest is recorded on the register then in the event of an insolvency, the liquidator and other unsecured creditors will be the beneficiaries.

Currently there is a two year transitional clause which deems security interests to be perfected until 30 January 2014 however, wherever an arrangement is entered into after 30 January 2012 or if it extends beyond 30 January 2014, the interest must be registered before 30 January 2014.

Kilikanoon ‘Oracle’ Shiraz 2007

Oracle (103x350)by Travis Schultz

While the Clare Valley in South Australia is perhaps best known for its remarkably good Riesling, it can also produce some cracking reds – like the Kilikanoon ‘Oracle’ Shiraz.

The 2007 vintage has had a few years to settle down and is now drinking superbly well. It seems that the forethought of winemaker Kevin Mitchell is now well and truly paying dividends! In his attempt to preserve the spicy plum characters exhibited in its youth, Kevin didn’t filter the 2007 release prior to bottling, and the result in 2013 is a wine of medium to full body that showcases the best of Clare terrior.

Decanting is definitely recommended so as to enable the plummy gum leaf edged flavours to really stimulate the front of the palate, while chocolate, spice and toastiness dance their way across the back. It’s the layers of complexity that make the Oracle a wine of great depth, but the French oak and tannins that drive a finish of finesse and integrity.

No wonder that it’s become an iconic Australian wine after only 14 years of production – but at the $60 plus price point, I guess it’s destined to become an investment, rather than ‘enjoy now’ style of wine.