June 4, 2018
Distributing the substantial estate of the late Mervin Reading was never going to be a straight-forward affair; ‘affair’ being the operative word…
Inviting delegates to dissect the roller-coaster ride of issues associated with the estate of fictitious property developer, Mervin Reading, was a true highlight of the 2018 Synchron Conference.
In a role-play courtroom drama, which had its basis in a real court case, Synchron Chair, Michael Harrison (The Judge) and corporate and commercial law expert, Millens Lawyers’ Keith Hanslow (The Barrister), orchestrated a magnificent exploration of what can go wrong in the event that individuals, life partners, relatives, business people, business partners, lawyers and, yes, financial advisers, make decisions or take actions that can have significant and lasting consequences.
Supported by a superb cast of industry peers comprising advisers, life company representatives and licensee colleagues, each of whom took on critical roles in the unfolding drama, this was, from beginning to end, both a brilliant learning tool and a sheer pleasure to experience.
The people and circumstances surrounding the untimely demise of the successful and respected property developer (or was he?) included, but were not restricted to:
- An ex-wife
- A new Russian wife – or was she?
- A son and a daughter
- A business partner
- A legal adviser
- An accountant
- A financial adviser
- A family home, a holiday home and a penthouse
- A caring ambulance medic to a grieving widow – or was he?
- A successful business – or was it?
- An estate worth millions and millions – or not…
The learnings for the adviser audience were pointed and numerous. They drove home the fact that most people are flawed in one way or another, which in itself underscores the critical role played by financial advisers in executing their services to the best of their ability – taking detailed files notes, having deep knowledge of their area of expertise, outsourcing advice gaps to trusted colleagues when necessary, understanding exactly who their client is and naturally serving their best interests.
The mock trial highlighted where some issues are black and white, but where many others come in various shades of grey, and can become a tangled web of complexity when determining the truth and apportioning levels of responsibility and/or culpability within a court of law.
The amazing array of issues raised in this brilliant presentation, which took months to blend into a ‘final performance’, included:
- Spousal relationships – in law and in fact
- Defacto relationships and the definition of a bona fide domestic partner
- Nominated beneficiaries and associated disputes
- Nominated beneficiaries under self-managed superannuation funds
- Legal definition of Separation
- Witnessing wills
- Trust deeds
- The legal difference between wedding ceremonies and commitment ceremonies
- Partnership agreements
- Binding financial agreements
- Pre-nuptial agreements
- Agreements signed under duress
- Need for independent legal advice
- Children employed in a family business
- Proceeds of the estate, versus proceeds of superannuation funds
- Overspending business owners or partners
- Business cashflow post-death
- Family trust ownership versus personal ownership – asset protection
- Insurance policies
- Key man insurance
- Life insurance policy loadings
- Transfer of ownership of a business
- Home assets – family home, penthouse, investment properties
- Personal guarantees
- Valuation of a business
- Place and time of death
- Discovery and procedures
- Quality of file notes, fact finding and needs analysis
- Risk assessment
- Risk mitigation strategies
- Taxation issues involved in estates
- Capital gains tax considerations
- Land tax issues
- Joint assets
- Insolvent estates
- Transfer of assets to adult beneficiaries
- Aged care
- Appointment of executors
The courtroom drama saw a resolution to the huge array of issues brought before it and the judgements of His Honour were subsequently made available to the courtroom.
There was logic and reasoning that accompanied His Honour’s determinations, some of them based in statute and some based on His Honour’s discretion. Much more difficult to relate for those not in attendance, however, was the spectacular Pretzel Manouvre articulated by Mervin Reading’s ex-wife, as well as his Russian partner, and his great appreciation of this ‘skill’.