Tuesday, April 19, 2005

Geoffrey Hills - Courts are unlikely to find against James Hardie Industries

Geoffrey Hills reminds us of how the notion of corporate veil was established the Salomon's case in 19th century England, and questions whether corporate law should give way to moral law.
The fundamental aims of tort and corporations law are in conflict. It has been observed that protection of the vulnerable is the “golden thread” and “core moral concern” of Australian tort law, but the courts also recognise the central economic importance of corporations law. At a moral level, there could hardly be a case in which responsible entities were more deserving of being stripped of the protection offered them by the separate entity doctrine of corporations law than one in which people have suffered terminal illness through the torfeasors’ concealment with knowledge of the real risks of their product.

This is a very well written article, and I would have to quote it beyond reasonable grounds of fair use, I suggest you have a read of it yourself. In particular, it discusses the scope of limited liability and acts of good faith.


  • CSR v Wren - expanded proximity test

Sunday, April 17, 2005

Long term low income earners and housing

Phil Greenspun write about the impact of immigration on minimal wages in the US.
There are plenty of people from poor countries who think that working 60-70 hours per week for $7.50/hour is acceptable, especially if there are opportunities for their children to do better. As long as the immigrants are streaming into the U.S. it seems unlikely that wages for the unskilled will rise.

He also offers some practical views on the long term implications, and how to tackle the problems:
With wages for low-skill workers set according to wages in India and China the living styles of many unskilled workers in America will have to be more like those in India and China.

Low-wage workers in America won't be able to afford housing constructed with currently prevailing methods.

If the Chinese can make a sleeping van for $10,000 (new) a low-wage worker could have transportation and minimal shelter at the same time.

Monday, April 11, 2005

Whom does the Law serve?

Margo Kingston's Webdiary quotes P.F. Journey:
The westerners often forget that the Asian Society is still basically feudal, collective and hierarchical. The Laws are there to serve the Power, not to check the Power. I have a deep suspicion that if we look closely enough this is also the case in the West, except that the West is very much more polished and sophisticated in hiding this whereas the Asians are blatant.

Wednesday, April 06, 2005

Living away from home allowance

If you live far away from your place of employment, your employer can pay you a living away from home allowance for the inconvenience (see Compliance Toolkit from ATO). But if you pay for your own accommodation under this situation, then under FCT v Green and FCT v Toms, your accommodation is private expense, and is not deductible.

Another craziness in our ol' tax system.

Tuesday, April 05, 2005

More on Barristerial Immunity

Janet Albretchtsen argues in The Australian that it is the role of the Parliament to make the public policy decision with regard to immunity of barristers from negligence claims, suggesting that the High Court should not make "judicial adventures".

I'd argue not so. The High Court, being a separate arm of government is entitled to make rules that uphold and regulate the conduct of its members such that their institution is held in highest regard by the members of the public. Failure to do so at the very highest levels only leads to the opinion that the legal system is unfit to run itself, and can only be changed by the Government.

The High Court could have ruled that D'Orta-Ekenaike vs Victorian Legal Aid & Anor [2004] HCA was non-justiciable, as there is going to be a perception of a conflict of interest, and defer to Parliament to make a decision. The Court has done this with environmental issues on the basis that this is a complex issue involving many public interests. Why not this one?

A former President of the NSW Bar Association suggested that incompetence of counsel could be established as grounds of appeal in civil cases, as a way of keeping barristerial immunity while "getting the results right". (via Adam Barnes)

If anyone cares to remember, Equity was created to overcome the harshness of the Common Law. To get the results right. Maybe it's time to bring that back.

Monday, April 04, 2005

National water trading and taxation - Australian Water Summit - November 2004

For those who are interested in water trading in Australia, the Australian Taxation Office has a speech on its website regarding tax laws with respect to trading of water entitlements.

Points of interest:

  • When water entitlement is leased, this is characterised as a form of rent.

  • there would be insufficient nexus between the income derived from a temporary transfer of water entitlements and the produce of the primary production business i.e. not primary production income

  • if whole of water entitlement is leased, then person is not carrying out a primary production business (but what if the land is turned into grazing instead?)

  • compensation padi by government for cancellation of water entitlements is ordinary income, since it replaces loss of production from land. But if owner wasn't using the water entitlement for income producing activities, then this might be treated as CGT

Tax laws wouldn't have to be so complex if there aren't so many industry-specific tax-breaks. In particular look at how sometimes compensation from water trading is treated as Capital Gains while at other times it is ordinary income.