eLegal Services Threatening Traditional Law Firms

online-willThe days of shelling out $350 to $1000 an hour for a lawyer – plus $1 for every page photocopied by their minimum-wage-earning admin assistant – may soon be at an end. The legal sector is facing disruptive threats that are turning business models upside down.

“Across many industries we’re seeing the simpler, lower-value activities digitally disrupted,” says Wallace Fan, one of the three co-founders of Greatwill, an app that allows people to tap out their last will and testament on their mobile devices.

“You can record a video of yourself to be played after you’ve gone, you can make as many changes as you like whenever you like to your will at no extra cost, and everything is time-stamped and stored in our secure digital archive. We email users periodically and if we repeatedly fail to get a response we contact their executor. We ask the executor to check on the user and remind them that, if it’s required, we have the most up-to-date of their will available.”

Fan and his partners plan to have 25,000 Australian customers signed up to Greatwill by the end of the year before they expand into Commonwealth countries with similar legal systems and, ultimately, huge markets such as China. “We’re also looking into adding additional documents, such as advance care planning and enduring power of attorney, to Greatwill,” Fan says.

After working as a globetrotting legal counsel for international companies and “emailing clients from my laptop in cafes from Paris to Dubai”, Katie Richards set up Virtual Legal with the intention of capitalising on all the digital world had to offer.

“Let’s say you’re considering buying a franchise,” she says. “You go to the website and choose whichever of our fixed-fee packages is appropriate.

“Then you scan and email us the relevant paperwork, which we forward to one of our team members in the Philippines. They do the basic tasks, such as inputting data and generating initial letters for review, while a lawyer in the Australian office liaises directly with you via phone or email.

“The pay-off for customers is that by doing things this way Virtual Legal only needs to charge around 40 per cent of what a top-tier law firm does, given we don’t have to pass on the costs of exorbitant rents and massive salaries.”

Richards plans to franchise her model to New Zealand next year and list her company by 2018. “When I went about unlearning everything I’d been taught about running a business in this industry, lots of my peers told me I was crazy. Now I get invited to give lectures to industry organisations and am constantly being asked for advice,” she laughs.

my-online-will-familylawexpress

Free Will storage on Family Law Express

Like Richards, Andrew Mellett was determined to rip up the rule book when he started his law firm Plexus, as much to offer work-life balance to his staff as to provide reasonably priced legal services to consumers.

“All legal tasks follow the same pattern,” he observes. “A client has a problem, the lawyer collects facts about that problem, applies those facts to the law and generates an outcome, such as contract. Through clever technology, Plexus collects those facts using a smart digital form and uses a variant of artificial intelligence to apply those facts to the law in order to generate the outcome automatically. For example, Plexus’s Promotions Wizard app automates the creation of terms and conditions, as well as permits, for organisations wanting to run a competition at a third of the cost of and 95 per cent faster than the traditional method.”

While Fan, Richards and Mellett readily admit there will continue to be a market for what traditional law firms offer, and that humans still have the edge over machines on the more complicated or cutting-edge legal tasks, all believe the industry is on the cusp of a shake up that will benefit all parties on balance.

“Are accountants nostalgic for the days when they had to write everything by hand into ledgers?” asks Mellett. “And are there any fewer of them around than there used to be? Technology can facilitate lower costs and better service while delivering satisfying, well-remunerated careers to lawyers.”

Estate Management Terminology and Family Law

big-money-divorce-calculatorBelow is a list of commonly used terminology that it pays to understand in when drafting your Will, pre-nuptial or co-habitation agreement, divorce settlement or family trust.

As with most things in life that involve love and money, it pays to understand the details, as far too often it is the expectations or details that we leave un-written or un-stated  that end of biting us hard when we least expect it.

The below list of related terms are by no means exhaustive, but they are a good starting point for anyone contemplating either beginning, ending or clarifying a important relationship that either involves us directly, or involves someone we care deeply about.

Appointor

The person who has the power to appoint and remove the trustee of a trust.

Beneficiary

A person who receives a benefit under a will, or from a trust.

Codicil

A document which amends a will.

Deceased estate

This is made up of all of the assets owned by the deceased when he/she dies.

De facto spouse

A person will be a de facto spouse of a testator if they are not legally married and are living together as a couple on a genuine domestic basis.

Executor

The person appointed by the will to administer the deceased estate. The executor holds all of the assets of the deceased until they are distributed in accordance with the will.

If the assets are to pass to a testamentary discretionary trust the executor passes control of the assets to the trustee, although normally the executor and trustee will be the same.

Family provision legislation

This legislation gives certain eligible people the right to claim a share of the deceased estate. The purpose of this legislation is to ensure that families and other dependents of the deceased are adequately cared for out of the deceased estate.

Guardian

The persons nominated by a will to care for infant children if both parents die. While a nomination of guardian under a will is given significant weight, the appointment can be reviewed by the Family Court, on application from a concerned interested party.

Intestate

A person who dies without a will is called an intestate, and an intestacy is created by their failure to dispose of their assets. A partial intestacy can occur when some but not all of the assets are disposed of by the will.

Joint tenancy

This occurs where assets are held jointly by two or more people. Upon the death of one of the joint tenants, their share of the property passes automatically to the other joint tenants (the right of survivorship) regardless of what their will states. The other ownership structure for jointly owned assets is tenants in common.

Personal representative

General term for ‘executor’ and ‘trustee’ or the person appointed to administer the estate. Often the term ‘legal personal representative’ (LPR) is used.

Probate

An order from the Supreme Court which gives the executor authority to administer the estate in accordance with the terms of the will.

Spouse

A person’s spouse is their husband or wife. For succession law purposes, a person whose marriage has been dissolved will no longer be a spouse.

Tenancy in common

This occurs where assets are held by two or more people, in equal or unequal shares. Tenants in common can sell or otherwise dispose of their share of the property. If an owner dies their share of the property is distributed according to their will. The other ownership structure for jointly owned assets is as joint tenants.

Testamentary discretionary trust

A testamentary discretionary trust (TDT) is a trust established by someone’s will and does not come into effect until their death.

Testator

The person who makes the will.

Trustee

The person who is the legal owner of the property in the trust. The trustee holds and administers the property of the trust for the benefit of the beneficiaries, in accordance with the terms of the trust once distributed by the executor. Often the executor and trustee are the same.

Trust property

The property that is held by the trustee of the trust, in accordance with the provisions of the trust deed. If the trust is a testamentary discretionary trust, the provisions of the trust deed are set out under the will.

Psychiatric records being aired in Family Court

psychiatric subpoenas in CourtPsychiatrists are handing their patients’ confidential records to the courts amid threats of jail, under a flourishing practice by solicitors of issuing “dirt digging” subpoenas.

Some patients have been powerless to prevent details about their past sexual abuse or childhood trauma being aired in court, even in matters where they are not a party to the legal proceedings, a paper published in Australasian Psychiatry says.

The authors claim that solicitors are seeking unfettered access to patient records in civil and criminal cases, regardless of their relevance.

“It appears to have become particularly commonplace for subpoenas to be used during family law proceedings for ‘fishing expeditions’ to ‘dig up dirt’ on estranged spouses,” the paper says. “These subpoenas typically ask for the entirety of the patient’s psychiatric records.”

Subpoenas are legal documents that compel certain material to be brought to court, and failure to comply can be deemed to be in contempt of court, an offence punishable by fines and imprisonment. The practical effect is that it is up to psychiatrists to demonstrate why disclosure of patients’ records should be prevented.

Medical legal advisers said the practice of solicitors issuing broad subpoenas to doctors was becoming more common. MDA National medico-legal advisory services manager Sara Bird said that 8 per cent of calls to the medical defence organisation were from doctors who had been subpoeaned, or called to give evidence in court.

“Particularly with the psychiatrists, who have very sensitive records, the doctors are concerned about releasing the information,” Dr Bird said.

Psychiatrist and study author Yvonne Skarbek said solicitors had threatened to have her arrested if she did not hand over her patients’ records in their entirety. Many of them had postnatal depression and a history of childhood trauma and abuse.

“All of that becomes discussed by the court, and that’s devastating to these women and, in many cases, retraumatises them,” Dr Skarbek said.

One psychiatric patient, who did not wish to be named, said she discovered, in front of a packed courtroom, that a psychiatrist had once described her as having borderline personality disorder. She later discovered that her entire medical file, which detailed childhood sexual abuse, suicidal thoughts and major depression, had been read by everyone in the courtroom.

“I was always assured that whatever was discussed within the four walls [of the psychiatrist’s room] would never be made public, and that’s what gave me the confidence to get help,” the woman said. “My biggest fear was for my secret to be exposed. The fact that I had no control, it’s made my anxieties more profound.”

Co-author and NSW chairman of the Royal Australian and New Zealand College of Psychiatrists Gary Galambos said the practice was a breach of privacy and was traumatic for vulnerable patients.

The former husband of one of his patients had used the information against her by repeating to their children what she had said about them in psychiatric therapy. “This completely destroyed this woman’s relationship with her children,” Dr Galambos said.

He wants the federal government to make patients’ psychiatric records privileged, unless there are compelling reasons to disclose them, such as a medical emergency, or significant risk of harm to a child.

The Australian Medical Association’s position is that doctors should only disclose patients’ medical records where the public benefit outweighs the risk to the patient.

Dr Galambos said most psychiatrists complied with demands for patients’ records because it was impractical to go to court to fight every subpoenathey received. “The problem is that the bar has been lowered,” he said. The Lawson Clinic in Gordon, where he works, receives about six subpoenas a month.

In hospitals, patients and their psychiatrists are not necessarily told when a subpoena has been issued, and they may not be aware that the records have been handed over until after the fact.

Psychiatrist and psychotherapist Janine Stevenson said the profession was constantly debating the best way to protect patient confidentiality when solicitors made demands.

“When you provide details, and sensitivities are revealed before the court, it can put therapy back years and years,” Dr Stevenson said. “It can be very detrimental to the relationship with the patient because how can they trust you?”

Secret to a Happy Family

large-familiesBig families are the happiest, while single dads struggle the most because they feel left out of their children’s lives, a five-year study of family life satisfaction has found.

Same-sex parents are the most resilient, have the highest self-esteem and the greatest social support of the eight family cohorts investigated by Edith Cowan University researcher Bronwyn Harman. Their satisfaction with their lives is only marginally less than that of parents with large families.

Dr Harman spent five years interviewing hundreds of parents from a range of family set-ups to ascertain what life is like for different families, and how resilience, social support and self-esteem contribute to parents’ happiness.

Participants filled out questionnaires that scored their resilience, perceived social support, self-esteem and life satisfaction. Dr Harman then ranked the different groups of parents based on their scores.

Parents with four or more children were the most satisfied with their lot, enjoying, rather than feeling overwhelmed by, the chaos of a big family.

Although they said they have to deal with comments such as “are they all yours?” or “do they all have the same father?”, large families benefit from lots of support from each other, and are rarely bored. Children learn responsibility from an early age, and older ones help out with their younger siblings.

“[The parents] usually say they always wanted a large family, it was planned that way, and it was a lifestyle they’d chosen,” Dr Harman said.

As the issue of gay marriage dominates political discussion, same-sex parents are also very happy with their lives, which Dr Harman attributes to greater social acceptance of lesbian, gay, bisexual and transgender people.

“As we move towards the idea of same-sex marriage as something we should have, the stigma around [same sex] parents is being reduced,” she said.

Same sex parents have battled against stigma and discrimination because of their sexuality, which has made them less concerned about public perceptions and the most resilient of parents.

“They have to go to a lot of effort to get these children, so these children are very, very much desired,” Dr Harman said. “Often when same-sex parents do have a child they feel like they’ve hit the jackpot because they didn’t think it was going to be possible because of their sexuality.”

Single fathers are the parents least satisfied with their lives because they feel like they’re perceived to be the lesser parent. They can be blocked from seeing their children, left out of the loop with communication about school and medical matters, and excluded from family celebrations. Single dads said they were often mistakenly viewed as the instigator of the family break up, and they struggle to get time off work to look after their children because “a good father is a breadwinner not a homemaker”.

“There is this perception that mothers are the real parents and fathers just sort of help,” Dr Harman said. “There is still no understanding in 2015 that fathers are co-parents that have just as much responsibility for kids.”

However single fathers whose children were now adults said it had been worth going through all the difficulties to maintain a strong relationship with their children.

Dr Harman said government services for families did not take into account that not all families were the same. “We need to remember that different groups of parents have different needs to contribute to their life satisfaction,” she said. “It would be much better if we were able to separate the needs of different families and tailor services towards those individual cohorts.”

Families speak:

Single dad: “I am broken and struggling with bitterness – and I struggle daily with the hurt”

Same-sex parents: “I feel more and more people are coming to realise that having same sex parents is not the worst a child could do in life”

Large families: “Our house is a joyful house. Our children all bring unique skills and personalities to our family”

 

Why Housing Boom is causing Headaches for Divorcees

property-settlementThe property boom is hitting Splitsville, as red-hot house prices make divorces and break-ups even messier.

Residential property prices have risen so sharply in the past 12 months – up 13.1 per cent in Sydney, and 4.7 per cent in Melbourne – exes are being forced to find creative ways to keep a roof over their heads.

Family lawyer Jacqueline Dawson says recent spikes in the market have contributed to more people deciding to continue living in the same house post-break-up.

“Particularly in Sydney, we see more separations under the one roof … I think that’s to do with the cost of rehousing,” says Dawson, solicitor director at Sexton Family Law in Sydney.

“I’ve also seen a rise in people taking on boarders.”

The housing boom has given warring parties even more to argue about, with valuations barely keeping pace with sale prices in some areas.

Buying the other party’s share of the family home has slipped out of reach for many.

Meanwhile, real estate agents and lawyers are reporting increased tensions over the timing and asking price of home sales, particularly for mid-range houses in suburbs that have experienced huge price hikes.

Some couples – particularly those with young children and strong ties to the local community – might even be dissuaded from splitting up because of the high cost of establishing two separate households.

“In terms of what I see at the coalface, it’s changing the way people think about a settlement because of the increasing unaffordability of that house,” Dawson says.

“I think there’s also a bit of nervousness, with people thinking ‘Do I want to pay this high price? What if there’s a fall in the market?'”

A recent New Zealand media report suggested divorcing spouses were deliberately delaying their settlements in order to cash in on soaring house prices. It cited NZ’s lowest divorce rate on record last year.

Some former spouses were even demanding multiple valuations to maximise their payouts so they could afford to buy again.

The latest Australian divorce statistics predate some of the most dramatic housing price hikes: the divorce rate fell by 4.6 per cent in 2013 to 2.1 people per 1000, compared to 2012 figures.

Family lawyer Susan Pearson of Sydney firm Pearson Emerson Meyer says factors contributing to this decline include mandatory early counselling for couples with children, the extension of rights under the Family Law Act to de facto couples and the increasing number of people living together before marriage.

In her view, while there may be some spouses who would seek to delay proceedings to take advantage of the rising property market, such manoeuvring is unnecessary because of delays in  Australia’s court system.

“It could take three years or more for a contested case to reach a final hearing and longer if one of the spouses is dissatisfied with the judge’s decision and there are grounds for an appeal,” Pearson says.

“This can influence couples to reach agreement to sell real estate to take advantage of a high market.”

Unlike in New Zealand, Australia also has in place a system to appoint an independent single expert to value real estate in a property settlement, dramatically reducing the role of adversarial experts.

In practice, separating couples typically seek a valuation before commencing negotiations and then update the valuation for the final hearing.

Simon Doak, senior sales agent at McGrath in Edgecliff in Sydney’s eastern suburbs, says clients in the process of splitting up are regularly surprised by how much their family home has grown in value.

“They’ve often tried to buy each other out but the growth, particularly this year, means there’s too much of a gap,” Doak says.

He has witnessed several relationship breakdowns where the former partners started out amicably, living under the same roof while going through the separation.

“The parameters change when it comes to selling the house, with one party more motivated to sell … Then it comes down to price.”

Doak says disagreements over price make it hard for agents to arrange a quick sale.

“It creates a lot of angst.”

A video Will raises serious questions after lengthy NSW Supreme Court hearing

video-willA dying woman sat in her kitchen, delivering “motherly exhortations” and her last will and testament to a video camera.

The 85-year-old widow glanced across the room at one of her daughters, who stood to inherit a larger share of the estate if the “video will” could alter a written will signed just two days earlier.

It is a scenario that might ring alarm bells, and which raises questions about whether a will that is not in writing and witnessed by at least two people is legally valid.

The NSW Supreme Court grappled with these questions recently in a decision traversing the intersection of law and technology.

The woman, who was born in China, made a formal written will in her solicitor’s office on March 6, 2012, dividing her $930,000 estate between her eight children who were scattered across the world.

She had intended to leave a greater share of the estate to two of her daughters in NSW, in recognition of their recent support. But one of the daughters persuaded her mother not to do so.

Two days later, “acutely conscious of her mortality”, the dying woman changed her mind. She was determined to give her daughters something more and decided to record her wishes on video, with the help of the second daughter and her husband.

“She was warned that a video recording might not operate in law as a will for a want of formality,” Justice Geoff Lindsay said.

“She was not deterred. She expressed a strong desire to speak to her children in making her intentions known to them after her death.”

Justice Linsday said he understood “the court had never before admitted a video will to probate”. It also appeared to be the first time the court had considered the interaction between a legal provision allowing the court to dispense with the requirement that a will be in writing, and provisions limiting the circumstances in which a beneficiary under a will can be a witness to it.

Justice Linsday said the woman made a “series of short, and apparently well-considered, disciplined statements of intent (coupled with motherly exhortations in passing) that stand neatly with the will as an alteration of the primary document”.

He ruled that, in light of the evidence and the absence of any objection from the other siblings, there was “no room for doubt” the will was voluntarily made. He admitted the video as an informal will.

But Justice Lindsay sounded a note of caution to others considering delivering a will to camera. The costs of the case and the substantial delay in processing the probate application – Ms Chan died in June 2012 – were the result of legal uncertainty about validity of a video will.

Family Law solicitor Ben O’Sullivan said his advice to clients was “always to comply strictly with the rules”, including reducing a will to writing and having independent witnesses.

He questioned why in this case a solicitor could not have attended to “record the updated testamentary intention and reduce that to writing”.

Family of Neville Wran agree to mediation over estate

neville-wran-and-daughterNeville Wran was labor premier of New South Wales from 1976 to 1986.

His life was marked by a remarkable political legacy, coupled with extra-ordinary business success post-politics.

Wran died in April last year (2014) aged 87 after suffering dementia. He left a fortune estimated to be worth up to $40 million, largely made up of an impressive property portfolio.

This estate is at the heart of a dispute within his extended family.

In an attempt at resolving the battle for Wran’s estate without expensive and lengthy court proceedings, negotiations will be heading behind closed doors, with the parties agreeing to mediation.

Glenn Wran, the son of Wran’s first wife Marcia, launched legal action against Kim Wran Sheftell, his half-sister and the estate’s executor, over the late Labor giant’s $40 million estate.

Wran’s youngest children, Harriet and Hugo Wran, by his second wife Jill Hickson Wran, have since joined the claim, as has his New Caledonia-born god-daughter Helene De Poortere. Mrs Hickson Wran is also a defendant.

During a hearing in the NSW Supreme Court late last month, Justice Philip Hallen was told the actual estate is valued between $700,000 and $1.6 million. But the notional estate, which could include superannuation, family trusts and real estate held with a joint tenant, is thought to be worth up to $40 million.

Nifty notched up much of his fortune as an investment banker, after leaving politics in 1986.

The court has previously heard Mrs Hickson Wran owns much of the property in the notional estate and under her late husband’s final will is the beneficiary of certain personal effects as well.

Prospects for a happy settlement don’t appear bright. Harriet’s lawyer said obtaining instructions from his client was “not straightforward” as she is currently on remand charged with the murder of drug dealer Daniel McNulty.

Ms De Poortere’s lawyer said his client couldn’t afford to pay the fees for mediation, prompting Justice Hallen to recommend the bill be paid for by the estate in the interim.

Talks are expected to take place over the next six weeks: if they are unsuccessful, the dispute is likely to be played out in a very public trial.

Surrogate mother refuses to let Gay parents take baby

Surrogate mother refuses to let gay parents take babyA couple is stranded in Thailand after their baby’s surrogate mother withdrew her permission for them to take the little girl home.

The surrogate, who is not biologically related to the baby, handed over newborn Carmen to American Gordon Lake and his Spanish husband Manuel Valero in January.

She then failed to show up at a meeting scheduled for her to sign paperwork allowing Carmen to leave Thailand with her fathers.

Lake and Valero say the woman, known only as Oy, refused to sign Carmen’s documentation after she realise the couple was gay.

“For the last six months, we have been stuck in Thailand, faced with the possibility of losing our jobs and our house back in the US because we cannot leave,” Lake wrote on a crowdfunding site they set up to assist with their legal fees.

“If we leave, we risk the greatest loss of all – our beautiful baby daughter, Carmen. All this because our surrogate doesn’t want Carmen to be raised by gay parents, and the law that should give me full parental powers excludes me from obtaining them because I am gay.”

Lake and Valero already have a two-year-old son named Alvaro, who was carried by an Indian surrogate.

“We chose Thailand for gestational surrogacy, where an egg donor is used. Our agency seemed reputable.

“They never warned us there could be any problem doing this as a gay couple. We certainly would have never started the process if we had known what we know now.

“The surrogate was friendly and willing to sign all documents, right up until Carmen was three days old and she met Manuel, my spouse.

“When she realised we aren’t an ‘ordinary’ family, in her words, she shut down the process allowing us to take Carmen home.”

The couple’s plight is made even more difficult due to a new Thai law banning foreigners from using local surrogates.

The new law was enacted in February and was prompted by a series of scandals surrounding Thailand’s surrogacy industry last year.

baby-carmenFirstly Australian baby Gammy, who has Down syndrome, was abandoned by his parents, who left him in Thailand when they returned home with his healthy twin sister.

Then, in a second controversy, nine babies fathered by a Japanese man using Thai surrogate mothers were discovered in a Bangkok apartment.

The couple’s surrogate was already pregnant with baby Carmen when those scandals broke.

The new law features a temporary provision allowing intended parents who had already begun the surrogacy process to claim parental rights over their babies, but as the provision uses the wording “husband and wife” it excludes gay parents.

“[The words ‘husband and wife’ close] the clear path to exiting the country that Carmen should be eligible for, because we are a gay couple,” Gordon wrote.

“We are good people who have gotten tangled up in a big problem. We only want to return home to our families with our daughter.”

When baby Carmen’s surrogate spoke to local television station Channel 3 she insisted she had no problem with the couple’s sexual orientation.

“But I’m worried about the baby, her future and that she might fall into the hands of human traffickers,” she said.

Meanwhile Lake told Channel 3 he and Valero wanted to solve the issue “peacefully”.

“She’s our daughter, we’ll be here as long as we need to be. We’re not leaving Thailand without our daughter,” he said.

“From the very beginning we’ve wanted to solve this peacefully. We want her to be involved in her life. We want to sit down and figure out how we solve this situation.

“We just want to talk to her … and find a way where she’ll be comfortable knowing we’re good parents and where she’ll be comfortable knowing Carmen is in a good family.”