au_common_admin, Author at McCaw Lewis

Directors’ Duties in Tough Economic Times: What You Need to Know

Posted on March 18, 2025March 18, 2026 by au_common_admin

Directors of companies in New Zealand are facing ever more challenging economic conditions characterised by varying interest rates, inflation, and market volatility. During periods of financial stress, directors must navigate complex legal responsibilities carefully, as failure to comply with statutory duties can lead to severe consequences, including personal liability and regulatory penalties.

Here’s a quick look at the key directors’ duties under the Companies Act 1993 (the Act) and some practical advice on how directors can mitigate risks during these trying times.

Core Duties of Directors

Under the Act, directors are bound by several fundamental obligations. Firstly, directors must always act in good faith and in the best interests of the company. In tough economic conditions, acting in the company’s best interests might involve making difficult but necessary decisions such as restructuring, cost reductions, or pursuing external investment.

Directors also have a duty to exercise the level of care, diligence, and skill that would be expected of a reasonable director in similar circumstances. Practically, this means staying informed about the company’s financial health and being actively involved in its decision making. The directors’ vigilance is particularly key in avoiding reckless trading, as continuing business operations in a manner that risks substantial loss to creditors is prohibited.

Further obligations arise when the company is approaching insolvency. Directors must avoid incurring new obligations if there is a reasonable belief that the company may not meet these liabilities.

Key Risks for Directors in Financially Stressed Businesses

Economic downturns introduce heightened risks for directors, particularly around cash flow management and creditor relationships. Ensuring that the company maintains its ability to meet payment obligations is essential, as failure to do so can expose directors to potential legal actions from creditors. Additionally, insolvent trading, which is continuing operations while unable to meet financial commitments, can lead to personal liability for directors.

In such conditions, directors are often subject to increased scrutiny from stakeholders, including shareholders, creditors, and regulatory authorities. Creditors may seek to call in debts owing, and shareholders have rights of action under the Act against the company and directors personally, as well as potentially the right to bring actions against directors on behalf of the company. Regulatory authorities can impose fines and, in a worst case scenario, criminal sentences.

Directors’ actions must demonstrate transparency, responsible governance, and compliance with all legal obligations to minimise potential claims or regulatory intervention.

Practical Guidance for Directors

To safeguard themselves and their companies, directors should take several proactive measures. Regular financial monitoring is key here, with close attention paid to cash flow, profit margins, and the company’s liabilities. Financial performance should be reviewed at a Board level regularly and rigorously.

To navigate complex situations and to minimise personal risk, directors should seek professional legal and financial advice early and often.

Transparent and honest communication with stakeholders is equally important, as proactive dialogue can help quell any uncertainty and avoid disputes or shareholder action.

Directors should also be open to exploring restructuring options, such as voluntary administration, creditor compromises, or, where necessary, winding up the company.

Recent Case Highlight

A recent and significant case highlighting the importance of directors’ duties is Yan v Mainzeal Property and Construction Limited [2023] NZSC 113. Mainzeal was placed into liquidation in 2013, owing unsecured creditors approximately $110 million. The Supreme Court found that the directors breached sections 135 (reckless trading) and 136 (duties in relation to obligations) of the Act. The directors had improperly relied on informal assurances of financial support without enforceable guarantees. The directors were ordered to personally pay $39.8 million (plus interest). This decision highlights the necessity for directors to rigorously adhere to statutory obligations, particularly around solvency and creditor protection, at the risk of their own personal liability.

Final Thoughts

Tough economic conditions demand directors demonstrate cautious, informed leadership and strict compliance with the statutory duties outlined in the Act. By understanding these obligations and proactively managing financial risks, directors can effectively navigate periods of economic uncertainty. Seeking timely professional advice is essential to mitigate potential liabilities and ensure informed decision making that protects both the company and its directors.

If you are a director experiencing financial challenges, consulting with your legal and financial advisers can provide essential guidance on fulfilling your obligations and safeguarding your business.

Recent Decisions from the Supreme Court on Trusts – What they Mean for You

Posted on March 11, 2025March 19, 2026 by au_common_admin

Two recent Supreme Court decisions – Cooper v Pinney and Legler v Formannoij – appear to send conflicting signals about acceptable levels of control over trusts. On one hand, Legler suggests that a single person effectively controlling a corporate trustee does not, in itself, undermine a trust. On the other hand, Cooper implies that trust control needs closer scrutiny when considering whether relationship property claims may apply.

For those setting up, managing, or attempting to challenge trusts, this inconsistency raises an important question: when does control over a trust amount to ownership, and when is it simply part of a valid trust structure?

The Tension at a Glance

At the heart of the decisions is a fundamental tension:

1. In Legler the Court upheld a trustee appointment despite allegations that it was made for an improper purpose. The dispute arose when the children of the deceased settlor challenged their stepmother’s decision to appoint a corporate trustee of which she was the sole director and shareholder. The Court ruled that while she effectively controlled the company, this did not necessarily mean the appointment was improper. The result reinforces that controlling a trust alone is not inherently problematic in equity.

2. In Cooper the Court took a different approach when assessing control in the context of relationship property. The dispute centred on whether Mr Pinney’s powers within a family trust—such as the ability to appoint and remove trustees and distribute assets—constituted property under the Property (Relationships) Act. If classified as property, the powers may have fallen into the relationship property pool to be divided between Mr Pinney and Ms Cooper following the breakdown of their relationship. However, the Supreme Court ruled that, because the powers were constrained by fiduciary duties, they did not constitute personal property interests.

The rulings certainly appear at odds and highlight the different approaches taken in trust law (often focussed on process rather than effect) and relationship property (designed to prevent unfair outcomes in asset division).

Key Practical Takeaways

How should you approach structuring and administering your trust in light of these decisions?

1. Structure Trust Control Carefully

Carefully consider who will have control over your trust. If you hold extensive powers as a settlor, trustee, beneficiary, and the person having the power to appoint and remove trustees, this could lead to scrutiny under the Property (Relationships) Act, though perhaps not in trust law. Adding independent trustees and/or requiring unanimous decisions for key trust actions can help reduce this risk.

2. Record and Document Trust Decisions

Courts look to both process and intent, and keeping clear records of trustee decisions can help justify each of these in a situation where a claim is made against your trust. If a decision is questioned, having a well-documented history of the background and reasoning for the decision will be crucial in proving that a trust has been managed properly. The records should address how the particular decision is ultimately in the beneficiaries’ interests.

3. Recognise and Accept that Relationship Property Law Has a Different Lens than Equity

Just because a structure is legally valid does not make it immune to relationship property claims. Seek legal advice on how your powers could be interpreted under the Property (Relationships) Act.

Final Thoughts – A Balancing Act

The Supreme Court’s recent rulings highlight an ongoing challenge in trust law: balancing the need to respect valid trust structures while preventing misuse. The key takeaway is that trust control is not a straightforward issue – it depends on the context. The decisions offer a timely reminder that trust structures must be well-thought-out prior to formation and should be regularly reviewed throughout the lifetime of the trust to ensure that they are defendable in different legal scenarios.

If you have questions about how these rulings may affect your trust or have concerns about protecting your assets from the possibility of a claim, our Asset Planning Team is here to help. Contact us to discuss a review of your trust and ensure your structure continues to provide the protections you require.

Understanding the Residential Tenancies Amendment Act 2024: Key Changes to New Zealand’s Rental Laws

Posted on March 5, 2025March 19, 2026 by au_common_admin

The Residential Tenancies Amendment Act 2024 (the Act) introduces a series of significant changes to New Zealand’s rental laws, aimed at improving tenant security, modernizing tenancy processes, and fostering a fairer balance between the rights of landlords and tenants.

Here’s a brief look at the major changes under the new law:

1. Bond Lodgement and Online Payments

One of the key changes in the Act is the requirement for all tenancy bonds to be lodged and paid online. Previously, tenants and landlords were required to physically submit bond payments and sign documents. Now modernized, this process is streamlined and simplified, with all bond payments handled electronically. This not only improves efficiency but also enhances transparency and ease of access for both landlords and tenants.

Additionally, this online system ensures that bond processing is quicker, reducing any delays or errors that may have occurred with the old paper-based system.

2. Termination of Tenancies

The amendments make significant adjustments to how and when tenancies can be terminated.

Periodic Tenancies: Previously, landlords could only end a periodic tenancy if they had a specific termination ground, for example, demolishing the property or carrying out extensive renovations. This has changed significantly with the new amendments. Now, landlords must provide at least 90 days’ notice to terminate a periodic tenancy without a specified cause. However, if the landlord has specific intentions—such as the intention to sell the property or move into it themselves—the notice period is shortened to 42 days.

For example:

If the landlord intends to sell the property and needs the tenant to vacate for the sale process, they are required to provide a 42-day notice.
The same applies if the landlord (or a close family member) plans to move into the rental property.

Automatic Transition of Fixed-Term Tenancies: The Act also ensures that fixed-term tenancies, which previously ended on a set date, will automatically roll over into periodic tenancies unless a landlord or tenant gives notice to end a fixed-term tenancy between 90 and 21 days before the fixed term ends, no specific reason is required. Or, the parties agree otherwise, for example, to renew the fixed term or to end the tenancy.

These changes offer tenants more predictable and stable living conditions, while also clarifying the process for both landlords and tenants.

3. Family Violence Provisions:

The Act also clarifies that a tenant’s children or dependants may withdraw from a tenancy due to family violence.

If a tenant or their child/dependant experiences family violence during a tenancy, they now have the ability to withdraw from the tenancy by giving at least 2 days’ notice (with qualifying evidence of family violence) without any financial penalty, or agreement required from the landlord.

4. Pet Provisions

One of the most anticipated changes under the Act is the way tenants can now request to have pets in rental properties. Previously, landlords had the right to refuse tenants’ requests to keep pets without having to provide a reason. The Act shifts this, allowing tenants to request pets with the understanding that landlords can refuse—but only for legislated reasons.

These reasons are non-exhaustive, but could include:

Concerns about damage to the property
Allergies or other health concerns of the landlord or other tenants
Incompatibility with other tenants’ pets or lifestyles

Landlords will also be able to require a ‘pet bond’ up to a maximum value of two weeks’ rent (in addition to the regular rental bond).

5. Other Technical Changes

Smoking Restrictions

The Act now clarifies that landlords can include smoking bans in their tenancy agreements. Smoking-related damage to properties, particularly from smoke residue or fire risks, has long been a concern for landlords. By giving landlords the option to impose smoking restrictions, the Act ensures that tenants maintain the property in good condition, while also fostering healthier living environments.

Communication via Email

Acknowledging the importance of digital communication in today’s world, the amendment allows email to be used as a valid form of communication between landlords, tenants, and Tenancy Services. This modernization reflects the growing reliance on technology and aims to make the process of sending and receiving important notices, agreements, and documents more efficient, accessible, and reduces reliance on slower, paper-based communication.

Simplified Tenancy Tribunal Dispute Resolution

Another important change involves the Tenancy Tribunal, the body responsible for resolving rental disputes. The Act allows for disputes to be resolved without formal hearings in some cases, potentially reducing the need for long waits and time-consuming legal processes. Instead, the Tribunal can resolve certain issues based on documentation or virtual hearings, making dispute resolution more efficient for both landlords and tenants.

Conclusion

The Residential Tenancies Amendment Act 2024 represents a major shift towards more equitable, transparent, and efficient rental laws in New Zealand. This new legislation creates a fairer balance between the rights and responsibilities of landlords and tenants. These changes modernize the rental experience, ensuring that both parties have clear guidelines and protections in place.

We are happy to discuss anything in this article that may have captured your attention. Feel free to get in touch.

Navigating the Fast-track Approvals Act 2024

Posted on February 27, 2025March 19, 2026 by au_common_admin

After a contentious journey through the Parliament, the Fast Track Approvals Act 2024 is here and as of 7 February 2024, the Fast track approval process is open to anyone who wants to apply for expedited consents of qualifying projects. Here’s how we can help.

Legislative overview

The Fast-track Approvals Act 2024 (the Act) came into effect in December 2024 and aims to achieve a more efficient consenting process for infrastructure and development projects that will bring significant regional or national benefit.

The Act initially listed 149 projects for which consent applications could be made directly to the Environmental Protection Authority (EPA), the expert panel tasked with considering each application. These projects span across various sectors including housing and land development (58), infrastructure (43), renewable energy (22), Mining (11), aquaculture and farming (7) and quarrying (8). A total of 19 of these projects are based in the Waikato.[1]

While the Act aims to simplify regulatory approvals, it does not remove the need to engage with Māori rights and interests. These projects inherently concern te taiao / the natural environment we live in. Māori have unique rights and relationships with their tribal areas. It’s important that this reality plays an integral part when pursuing a project.

Why tikanga matters

Throughout the Act are sections relating to the Treaty of Waitangi. In particular, the Act addresses:

Existing Treaty settlements;
Customary rights recognised under the Marine and Coastal Area (Takutai Moana) Act 2011;
Te Ture Whaimana, which governs activities affecting the Waikato and Waipā Rivers.

A failure to address these requirements can lead to delays, disputes, or an application being declined. Having expert tikanga advice from the outset ensures that cultural obligations are not just met but effectively integrated into the process, strengthening the overall process and relationships between people on the ground.

How we can assist you

Our team offers expert guidance on:

Engaging authentically and respectfully with all parties
Upholding kaitiatkitanga and sustainable development practices
Fostering a deeper understanding of all communities and connection to land
Developing projects that uplift and support all communities while protecting cultural site and taonga.

Strategic tikanga support for Fast-track success

For projects involving Māori land under section 23 of the Act, the Minister has discretion to determine whether certain infrastructure projects can proceed. Before making a decision, the Minister must assess the impact on Māori landowners and their rights. Our teams expertise in whenua Māori is well versed to ensure that any application addresses these concerns proactively. Further, under section 18 of the Act, a Treaty settlement report is required to assess the impact of a project on Māori rights and interests. Our team can assist with engagement and adherence to Treaty obligations.

A successful fast-track application requires more than just meeting regulatory requirements, it requires tikanga integration. We provide tailored advice to assess and ensure any fast-track project aligns with the necessary obligations.

Whether you’re an iwi group, fast track applicant, or third party with an interest in a fast-track project, contact our Resource Management experts as part of our Kahurangi Whenua Team to see how we can assist.

My Ex Lives in the Family Home – Should They Pay Occupational Rent?

Posted on February 18, 2025March 19, 2026 by au_common_admin

When a relationship breaks down, it is common for one party to remain in the family home while the other pays for accommodation elsewhere. This situation can raise concerns of fairness if one party is able to continue to enjoy the use of the home. In this article, we explore the concept of “occupational rent” and how it can help separating couples reach a fair outcome.

What is Occupational Rent?

Occupational rent is essentially “market rent” paid by the party continuing to live in the family home to compensate the party who moves out and pays for alternative accommodation. Depending on the amicability of the separation, this arrangement can last for months (or even years) until issues regarding ownership are finalised.

How is Occupational Rent Calculated?

The standard calculation is 50% of the market rent. For example, if the market rent for the family home is $700 per week, the party who moved out will be due $350 per week from the separation date to the date matters are settled. Parties can agree amongst themselves an acceptable market rent value, or an expert may be called upon to determine the appropriate market rent.

But I’ve Been Paying the Mortgage

In practice, occupational rent is often used as an offset to balance claims for other costs or post-separation contributions. Occupational rent is often offset against the mortgage, rates and insurance of the family home to ensure each party’s post-separation contributions are compensated fairly. It can even be used to counter spousal maintenance payments.

Is Occupational Rent a Certainty?

Whether to order a payment of occupational rent is entirely at the Court’s discretion. It is not a guarantee and cannot be relied on. The Court sometimes takes a “broadbrush approach”, meaning that every set of circumstances is assessed on its own merit. The Court uses its power under the Property (Relationships) Act 1976 to consider whether an order is just, considering factors including the financial impact an order would cause to either party and the interests of any children.

Knowing your rights and obligations following a separation can be difficult. The experienced team at McCaw Lewis can help you navigate relationship property matters or answer any questions you may have.

Chantelle is an Associate in our Dispute Resolution Team.

Chantelle can be contacted on 07 958 7473 or chantelle.holland@mccawlewis.co.nz

Things you need to know about social media posts and employment

Posted on February 11, 2025March 19, 2026 by au_common_admin

Social media has become a big part of most people’s daily routine, and as a result, many aspects of our lives can be found easily online. When it comes to differentiating between our personal and professional lives, the line is sometimes hard to find.

And in an employment situation, questions can arise over what an employee does in their personal life and how that can be dealt with in the workplace. Is there anything that an employer can do about an employee’s personal social media posts?

Employee behaviour outside the workplace

Generally, an employee can be disciplined or even dismissed for misconduct that occurs outside of the workplace.

This is not a free for all and there does need to be some link between the employee’s conduct and their employment. For example, this can be the case where an individual is well known in a professional setting and does something that has the potential to bring their employer into disrepute by association.

So, what’s the deal with social media activity of employees?

It goes without saying that anyone using a work profile or operating a company account has to “play by the rules” around social media. Equally, if an employee is expressly posting about work topics, in work uniform or on work premises, the employee will be open to disciplinary action if the posts are inappropriate or in breach of employer rules.

But when using a personal social media account – what then?

In short, this needs to be dealt with on a case by case basis, considering all the circumstances. Key considerations that need to be weighed up when addressing social media posts by employees include:

Are the social media posts clearly made by an employee? It is not sufficient for an employee to use an alternative name or image effect if it can still be traced back to them, and in turn the employer.
What does the social media post say? This will mean looking at the specific wording but also considering whether there are other clear inferences that can be taken from the strict wording in the circumstances, given the topic or other surrounding comments.
Who is able to see the post? Even comments made on private accounts to an employee’s friends may still be misconduct.
Check the relevant policies. There will often be employer policies which deal with social media specifically, and these do need to be followed. There might also be general code of conduct provisions relevant to the situation.
Are there any other industry requirements or obligations that might apply? For example, there may be specific privacy rules at play or industry requirements around confidentiality.
How might the content of the posts, or the action itself, fit with the employer’s values? At times, the content of posts, or even the fact of making any comment on a particular topic, will be at odds with the values or core functions of the employer. This may be the case where an employer is performing a public function or providing services of a nature that require certain public confidence.
Do the posts have the potential to bring the employer into disrepute? Employees should recognise that social media posts can reach people right across the world, regardless of how and where they are posted. They can be received in many ways as well. Whether a post has the potential to bring an employer into disrepute will depend on the wider context.
Are the posts of a nature or content that destroys the employer’s relationship of trust and confidence with the employee?

While there is protection for free speech at an individual level, this does not enable or entitle employees to take steps or make statements that have the potential to adversely affect their employer. When entering into an employment relationship, both parties have obligations of good faith to each other to ensure a productive working relationship. Rude or inappropriate social media posts do not fit into that category.

For both employers and employees, it is important to understand employer policies and key values or expectations of employees.

For employees, always err on the side of caution. If it is that important for you to post something online, you can always read the policies and check with your employer first.
For employers looking to avoid this situation, ensure that your policies are up to date and well communicated to your team. If faced with this situation, the best approach is always to discuss matters with your employee before taking any further action.

Remember that posts on social media can last forever, regardless of whether they are deleted and who you share them with. Care and caution should always be exercised.

For further information or advice on matters, or to update your social media policies, contact Executive Director, Renika Siciliano, or any of our Workplace Law Team at McCaw Lewis.

Retirement villages: Navigating the transition to a higher level of care

Posted on December 19, 2024March 19, 2026 by au_common_admin

Many retirement villages in New Zealand provide a continuum of care, allowing residents to access increasing levels of support as their needs change. This model offers peace of mind, but the process of transitioning to higher care within these villages involves important contractual, and financial considerations. For residents and their families, understanding the legal framework is essential to ensure a smooth transition.

The Role of the Occupation Right Agreement (ORA)

An Occupation Right Agreement (ORA) is the foundation of retirement village arrangements. It outlines the legal rights and obligations of residents and the village operator. When it comes to transferring to higher care levels, the ORA specifies:

Conditions for Transition: When a resident may be required or permitted to move to a higher level of care, such as a serviced apartment, rest home, or hospital-level care.
Costs: Additional charges for care services, accommodation, or other fees associated with the new care level.
Termination and Resale Rights: The ORA sets out the process for terminating the agreement and refunding capital contributions when vacating an independent unit.

It is important to get legal advice to ensure residents and families understand these terms and their implications.

Legal Framework for Care Transitions

The Retirement Villages Act 2003 and the Retirement Villages Code of Practice 2008 regulate the operation of retirement villages and protect residents’ rights. Key legal principles include:

Good Faith and Consultation: Operators must act in good faith and consult residents about any significant decisions, including care transitions.
Consent Requirements: Residents generally need to consent to any move, except in cases where health or safety risks necessitate immediate action.
Health Assessments: Care transitions are often triggered by health assessments conducted by the village’s clinical team or external assessors, such as the NASC (Needs Assessment and Service Coordination) team.
Notice Periods: Operators must provide reasonable notice if a resident is required to vacate their current unit to transition to higher care.

Financial Implications of Moving to Higher Care

It goes without saying that the financial impact of transitioning to a higher level of care is a critical consideration. The ORA governs costs such as:

Additional Fees: Higher care levels often involve increased service fees, including meals, personal care, and medical supervision.
Refunds and Deductions: The ORA sets out when the capital contribution will be refunded and what deductions, if any, will apply when a resident’s independent living unit is vacated.
Public Subsidies: Residents may be eligible for government support, such as the Residential Care Subsidy, which is means-tested and designed to help cover the cost of rest home or hospital care.

Availability of Care Services

Not all retirement villages offer every level of care on-site. Some villages may only provide independent living and serviced apartments, requiring residents to relocate to another facility for higher care levels.

The ORA will specify the village’s obligations in such scenarios, including:

Placement Guarantees: Whether residents are guaranteed access to higher care within the village.
Alternative Arrangements: What assistance the village will provide if care services are unavailable locally.

Operators are expected to act in good faith and facilitate the transition, but families may need to explore other facilities if care options are limited.

Practical Tips for Residents and Families

Understand the ORA: Before signing, ensure the agreement is reviewed by a lawyer who can explain its terms, especially those related to care transitions and financial implications.
Plan Ahead: Discuss care preferences and potential transitions early with the village operator and family members.
Seek Financial Advice: Assess the financial impact of moving to higher care, including eligibility for subsidies.

Conclusion

Taking the time to review agreements, plan finances, and seek professional advice ensures that residents’ rights are protected, and their care needs are met. The McCaw Lewis team are very experienced in dealing with these situations and are happy to assist at the appropriate time.

Amanda is the Director in our Asset Planning Team and can be contacted on 07 958 7451.

The Deed of Lease Seventh Edition 2024: A Beginner’s Guide

Posted on December 3, 2024March 19, 2026 by au_common_admin

The Seventh Edition of the Law Association’s Deed of Lease template was released on the 24^th of November 2024, and replaces the Sixth Edition which, subject to some minor adjustments, had been standard since 2012. The new edition may be considered an early Christmas gift to some, but is it really out with the old and in with the new? Here’s a summary of the key changes to help you navigate the Seventh Edition Deed of Lease.

Renewals Notice Period: The Seventh Edition allows parties to agree a renewal notice period that is longer or shorter than the former three months. This allows flexibility for leases of different lengths and can account for time required to make good prior to termination.
Rent Reviews: Rent Reviews now include more options for types of reviews (including fixed rent adjustment, as well as the standard CPI and market reviews), and expands the ratchet options, to include both hard, soft and custom options (e.g. rent must not be less than the previously payable rent, or the rent payable at commencement).
Outgoings: The new edition also expands on the outgoings that may be charged, e.g. by including exterior and fencing repainting charges, accessway maintenance and minor repairs to external areas, reasonable management administration expenses for body corporates, and so on. There are also stricter requirements on the charging of outgoings, with landlords now being obliged to provide an annual budget of outgoings to tenants.
Insurance: The new edition allows for parties to specify the insurance excess amount, and the default insurance excess has increased to $5,000 from the former $2,000 under the Sixth Edition. If an act or omission on the part of the tenant causes damage that exceeds the excess amount, the tenant is liable to pay the landlord.
Health and Safety Obligations: Health and safety obligations are now explicitly imposed on all parties to the lease.
Seismic Ratings: One major motivation for redrafting the Deed of Lease was the ongoing impacts of earthquakes on commercial infrastructure, and there is now a space to detail the building’s seismic rating. While the new edition does not penalise landlords for not specifying the seismic rating, it is a great prompt to discuss these matters.
Bank Guarantees and Rental Bonds: The Seventh Edition now explicitly allows for bank guarantees and rental bonds to be provided as security against default.
No access rent adjustments: Although the previous edition did provide for rental abatement where tenants are unable to access the property, the abatement was limited to being a “fair proportion”, which was often hard to assess. In the new edition, the parties can explicitly agree on a reduction percentage, and either party can call for that percentage to be reviewed in the context of a particular emergency.
Tenants Fixtures and Fittings: Schedule 6 of the new edition now includes a dedicated space to list the tenant’s fixtures and fittings.

Overall, The Law Association’s new Seventh Editon Deed of Lease continues to aim to balance tenant and landlord responsibilities by expanding on the options available to both parties. There is a lot of new content in a new edition, and although not everything will always be relevant, it is a great jumping off point for negotiations between the parties.

If you have any questions about the Seventh Edition Deed of Lease, please feel free to get in touch with our friendly property team.

What you need to know: Pre-settlement Inspections

Posted on November 21, 2024March 19, 2026 by au_common_admin

What is a pre-settlement inspection?

A pre-settlement inspection gives you the opportunity to ensure that the property you are purchasing is in the same condition as it was in when you entered into the agreement. It also allows you to check that any chattels included in your purchase work as they are supposed to and that any work that the vendor promised to complete before settlement has been completed.

When should I complete my pre-settlement inspection?

Generally, pre-settlement inspections should be carried out at least two working days prior to settlement. This is to give enough time for any issues from this inspection to be raised with the vendor, and rectified. It also means that the vendor may have begun to move their belongings out of the property, so allows for a closer inspection of the property.

Does everyone get to do a pre-settlement inspection?

If the property you are purchasing is tenanted, you may not have a right to a pre-settlement inspection. If you are buying a tenanted property and wish to complete a pre-settlement inspection, you can contact us to help you negotiate a right to a pre-settlement inspection prior to entering an agreement to purchase a property.

How many pre-settlement inspections can I do?

Generally, you can only complete one inspection. However, if you ask that the vendor rectify an issue following your first pre-settlement inspection, and they agree to do this, then you can inspect the property once more to ensure that this work has been completed.

What should I look out for in my pre-settlement inspection?

There are plenty of checklists online, which we suggest you save to your phone or print out and take to the pre-settlement inspection with you.

Some of the things you should look out for are:

Whether the chattels listed in the sale and purchase agreement are in reasonable working order (e.g. fridge, washing machine, dishwasher – you should ask to run these to check that they are working).
Damage to walls which was not previously present (holes in the wall).
Damage to carpets, flooring, curtains.
Look at ceilings and around toilets, washing machines, dishwashers for any signs of leaks.
Do the toilets flush?
Are all the electrical sockets working?
Are all the lights working?
Have there been any broken windows?
Do the sinks (kitchen, bathroom, laundry) drain properly?
Do the oven and the oven lights work?
Does the extractor fan work?

There are no issues, but the house is not in a clean and tidy state, what do I do?

Some purchasers will be surprised to find out that there is no requirement for the vendor to clean the house prior to settlement.

If you would like the vendor to get the house professionally cleaned before settlement, this is something that you should discuss with us before entering into an agreement.

Similarly, if you are concerned about the vendor leaving rubbish at the property, you should speak to us before entering into an agreement. We can negotiate a clause into the agreement which ensures that the rubbish is removed prior to settlement (if the vendor is agreeable of course!).

I’ve completed my pre-settlement inspection, and I have an issue, what should I do?

You should contact your lawyer immediately. They will be able to work with you to use the rights available in the sale and purchase agreement to rectify the issue or issues.

What remedies do I have available to me?

Generally, if there is an issue raised from the pre-settlement inspection, this does not give you a right to cancel the agreement. However, it can give you a ‘right to compensation.’

The following remedies may be available to you:

Asking the vendor to remedy the issue before settlement at their cost; or
Asking to reduce the purchase price to enable you to remedy the issues after settlement yourself; or
An agreed amount is retained on settlement until the issues have been resolved.

What if I find an issue after settlement has been completed?

It is much harder to get a vendor to engage once they have money in hand. However, if you do notice an issue post-settlement, you can get in touch with us to discuss your potential options.

If you have any questions about pre-settlement inspections, please feel free to get in touch with our friendly property team.

What you should know about Te Tiriti o Waitangi

Posted on November 14, 2024March 19, 2026 by au_common_admin

Recently, there has been increasing discussion about the te Tiriti o Waitangi (te Tiriti)/Treaty of Waitangi (the Treaty) and what it means. As a foundational document for Aotearoa New Zealand, it is important to understand what it says, the spirit and intent of te Tiriti, and what it means today.

How did te Tiriti o Waitangi come about?

Te Tiriti was first signed at Waitangi on 6 February 1840 by 43-46 rangatira, Captain William Hobson and other English settlers. It was later signed at various other locations throughout Aotearoa. By the end of 1840, over 500 Māori had signed Te Tiriti (the Māori text) and 39 rangatira had signed the Treaty (the English text).

Te Tiriti was intended to unite Māori and the British who settled in Aotearoa, and to enable the establishment of a British government in Aotearoa to control the increasing number of British settling here.

It is also important to note that the signing of te Tiriti/the Treaty followed the signing of He Whakaputanga (the Declaration of Independence) signed in 1835 which declared New Zealand a sovereign state.

Why did they enter into te Tiriti o Waitangi?

Te Tiriti is a binding agreement between two sovereign nations. The preamble to the Treaty (English text) recorded the intentions as being to:

protect Māori/tribal interests from the encroaching British settlement.
provide for British settlement.
establish a government to maintain peace and order.

Te Tiriti included similar statements but with a focus on securing tribal rangatiratanga and Māori land ownership.

It is clear from the wording of te Tiriti/the Treaty and from the historical record that, in the context of the time, rangatira and the British Crown agreed to share power and authority. Both would retain their respective roles and different spheres of influence – the Crown (Governor Hobson) with authority only to control Pākehā within Aotearoa, and rangatira retaining their authority over their hapū and territories.

What does te Tiriti o Waitangi/the Treaty of Waitangi say?

It is well known that the Māori text and the English text have different meanings. Where there is a difference of interpretation between two versions of a document like this – the law says that the preferred meaning is the one that works against the drafter. This is called the contra proferentem rule. This means that the Māori text – which over 500 Māori signed – is the version which is binding on the parties.

In short, te Tiriti says:

Rangatira Māori gave the British “kāwanatanga”, the right of governance. In the English text, Māori ceded “sovereignty” but there was no direct translation for this in Māori. For this to have been the case, perhaps words like rangatiratanga or mana would have been used.
Hapū were guaranteed rangatiratanga over their lands and taonga. Land would be sold to the Queen at agreed prices. In the English text, they were guaranteed the undisturbed possession of their properties, including their lands, forests, and fisheries, for as long as they wished to retain them but only the Crown could purchase land from Māori.
Māori were promised the same rights and duties of citizenship as the people of England. Similarly, in English, Māori were promised the benefits of royal protection and full citizenship.

Te Tiriti does not take anything away from the Crown or settlers to Aotearoa. It records existing rights which Māori had prior to the establishment of the government here and their protection by the Crown. It makes guarantees to Māori in recognition of the fact that the British were coming into their whenua, their country.

What do people mean by “Treaty principles”?

Over time, our Courts and the Waitangi Tribunal have developed and interpreted Treaty principles to guide the relationship between the Crown and Māori. This reflects the fact that the Treaty is a binding agreement between the Crown and Māori that applies in various settings today. Accordingly, the Treaty principles are not static, they evolve to reflect our society, in line with the spirit and intention of te Tiriti.

While there are a number of specific Treaty principles, the key principles include:

Partnership – a central Treaty principle based on the relationship created by te Tiriti akin to a partnership with mutual obligations to act reasonably and with the utmost good faith.
Active protection – this requires honourable conduct by the Crown and fair processes, including full consultation and – at times – decision-making by those whose interests are to be protected. It applies to all interests guaranteed to Māori, including intangible properties.
Tino rangatiratanga – Māori have mana or chiefly authority over their own lands, people, affairs and resources in line with their pre-existing sovereign authority.
Good government – the Crown’s actions must be just and fair in order to demonstrate good government or good governance, in particular keeping its own laws, rules and standards.
Equity – the Crown is to act fairly as between Māori and non-Māori citizens, and to remove the longstanding barriers preventing Māori from having a level playing field. This is not about equal treatment, but rather equitable treatment in the context.
Redress – when the Crown breaches te Tiriti/the Treaty, it has a duty to provide redress for those breaches.

This is but a snapshot of what te Tiriti says and the context which it was developed and signed within. It is a foundational document for Aotearoa and an agreement which – although breached by the Crown on numerous occasions – remains today. It is important to understand what the texts of te Tiriti/the Treaty say and what they mean. Various reports from the Waitangi Tribunal provide useful guidance in this respect, including He Whakaputanga me te Tiriti (2014) and Ngā Mātāpono – The Principles (2023/2024).

For assistance with matters relating to potential Treaty breaches and constitutional advice, please contact our Kahurangi Tiriti Team led by Executive Director, Renika Siciliano.

Author: au_common_admin