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LEGT 1710
BUSINESS AND THE LAW
PROPERTY LAW
2013 The University of New South Wales, Sydney 2052 Australia
The original material prepared for this guide is copyright.
Apart from fair dealing for the purposes of private study, research, criticism or review, as permitted under the Copyright Act, no part may be reproduced byany process without written permission. Enquiries should be addressed to the Head of School, Taxation and Business Law, UNSW, Sydney
Assignment 2
Due Monday 23 Sept by 5pm
Online submission only via Turnitin (on
Blackboard)
Include cover sheet if possible to scan
otherwise, just submit without cover sheet
as Turnitin will pick up your details
Week 9 Tutorial Materials
Competition Law
ACCC Materials on Blackboard: please
note the ACCCs copyright requirements
Group work in class
Mid-Semester Break
Monday 30 September to Monday 7 October
Classes resume Tuesday 8 October, Week 10
Week 10: NEW TOPIC, Tort Law
Tort Law will be examined in the final exam as a problemquestion, so do not miss the lecture on this topic
FOR MONDAY LECTURE ONLY:
Tuesday 8 October lecture will be recorded
Students who attend the Monday class should listen
to the recording as there will be no face-to-facelecture on Monday 7 October
Next face-to-face lecture for Monday stream will beheld Monday 14 October
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This week
Meaning of property
Real property
Land/Fixtures on the land
Ownership vs possession
Systems of title to land and types of land ownership
Legal vs equitable interests
Transferring ownership
Steps to a conveyance
Property as security
Personal property
Chose in action/possession
Transferring ownership
Property as security
Intellectual property Copyright
Designs/Patents
Trademarks
Confidential Information
Overview
On completion of this week in you should be able to:
9 Distinguish between real property, personal property and intellectualproperty
9 Distinguish between ownership and possession
9 Identify and explain the types of ownership of land9 Explain the difference between legal and equitable interests
9 Explain the key features of the Torrens system
9 Explain how real property can be transferred from one owner to anothe9 Explain how personal property can be transferred from one owner to
another9 Discuss how lenders (including financial institutions) can take security
over different types of property
9 Explain what intellectual property is and what intellectual property lawsprotect
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Relevance of property law to business
Knowledge of property law is essential for business
people
Businesses own or lease property
Businesses trade in goods or services
Businesses own goods/assets
Assets of businesses form property
Understanding of property law provides better business
understanding of the rights they have to those assets etc
What is property?
Australian law developed under English common law
Also, some property-related statutes at Commonwealth and
State/Territory level, such as:
- Native Title Act 1993 (Cth)
- Real Property Act 1900(NSW)
The word property describes types of rights and
interests recognised by law
Can be divided into : Real property = land and improvements, and
Personal property = all other property (tangible and intangible,
including intellectual property)
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Personal property
Can be divided into two categories:
Chose in action (intangible property)
Chose in possession (tangible property)
Chose is French word for thing
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Chose in action
Chose in action
Intangible property interests: interests thatcannot be seen, held or touched
Right of property that can only be claimed orenforced by the taking of legal action (notby taking physical possession)
Some examples:
- Right to sue
- Shares in a company
- Intellectual propertySee Latimer at 3-040
1111
Chose in possession
Chose in possession
Tangible physical property
Something that can be possessed
Some examples:
- Ownership of a house
- Ownership of a car
- Ownership of jewellery, artworks, stamp collections
or other collectible items etc
ee Latimer at 3-040
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Ownership vs Possession
Owneris entitled to all the legal rights over the
property
Possession involves
physical control of the property by the
possessor
the intention to claim exclusive control
See Latimer at 3-050
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Rights of a person in possession
Possession is good against the whole world
except the owner
Cases:
Armory v Delamirie
Bridges v Hawkesworth
Waverley Borough Council v Fletcher
ee Latimer at 3-060
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Real property
Land
Fixtures (ie things that are attached to the land)
Note: Land includes improvements such as
buildings on the land (not usually called
fixtures)
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Definition of Land
Limits of land: Height and Depth
Ownership extends upwards to the heavens
and downwards to the centre of the earth (but
there are some exceptions: eg: The Crown
(State) owns minerals in soil.
See Latimer at 3-070 to 3-150
1717 1
Fixtures
Tests as to whether an item is a fixture: (case law)
Fixed by means other than its own weight?
Intention to be permanently fixed for a
substantial period or for a temporary purpose?
Degree of damage on removal?
See Latimer at 3-080
1
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Ownership of land: Systems of Title
Systems of title to land in Australia:
Private ownership :
Torrens title (99%)
Old system title (or general law)
Also
Native title
Crown Land
See Latimer at 3-290 to 3-425
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Torrens Title
Often called freehold land/title
System of land ownership based on registrationof title on a public register (held at the LandTitles Office)
Creates a system of title by registration
The Register and Certificate of Title reflect all
legal interests relevant to the land
Torrens Title
Registration gives title (ownership) of the land to
the registered proprietor (owner)
Those holding other types of interests over the
land can also register their interests on title.
Examples: mortgages, leases.
Torrens Title
Effect of registration:
removes uncertainties of title
Provides proof of title of the registered
proprietor so no other person can claim to be
the owner
Provides evidence of the information it
records (mirror principle)
gives priority upon registration (indefeasibility
principle)
Torrens Title
Title held under a registered interest isindefeasible by unregistered interests
If register is incorrect, the State maycompensate (insurance principle)
Leading Case: Frazer v Walker, see Latimer at3-300
22
Torrens Title
Exceptions to indefeasibility of title:
Statutory fraud. Example: Owner became registered byforgery.
Unconscionable conduct
Constructive trust - where registered owner holds theland subject to rights of beneficiaries
See Latimer at 3-300
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Priorities under Torrens Title
A person acquiring interest on the faith of
he register obtains title free of unregistered
nterests
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Priorities under Torrens Title
A person with an unregistered interest in land
can be protected by:
registration (eg a banks mortgage) or
lodging a caveat (freezes title)
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Caveat: to stop land dealings
What is it?
A caveat is:- a written warning or an entry
- Entered on register to stop certain land dealings beingregistered without the caveators agreement
- like an injunction and shows that someone else has anunregistered interest in the land
Can be lodged at the NSW Land Titles Office by aperson who reasonably believes they have an interestin land
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Priorities under Torrens Title
The earlier of two unregistered interests has
priority
The court will consider the conduct of the parties
and all circumstances to determine which party
has the better claim
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Legal and Equitable Interests in Land
Legal interests under Torrens Title are all registered
interests
An unregistered interest becomes a legal interest o
registration (eg a purchaser of land on registration).
Equitable interests may be held by those who have
no registered (legal) interest.
As an exception to indefeasibility, a legal owner
may occasionally have to recognise rights/claims of
another party who may have equitable interests
See Latimer at 3-200 to 3-280
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Equitable interests
quitable interests include:
interest of a beneficiary under a will
interest under contract allowing legal or equitable owner
to assign/lease property
interest of the lessee/purchaser (before settlement)
an option to purchase
interest of a beneficiary in a trust
interest of a partner in the partnership property
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Old System Title or General Law
Ownership is proved by tracing ownership back to an
unchallengeable beginning
Chain of title, making a good root of title
Tracing of title required each time owners wanted to
deal with their property
Difficult, time consuming and complex procedure
Now applies to only very few parcels of land in
Australia that are not registered under the Torrenssystem
See Latimer at 3-370 to 3-380
3333
Native title
Mabos case recognised that acquisition
of sovereignty by the Crown was subject
to the interests and rights of indigenous
inhabitants in land
The rights and interests of the indigenous people arerecognised by the common law of Australia today.
Native Title Legislation: Native Title Act 1993 (Cth)
Note: native title cannot exist over freehold land (TorrensTitle).
ee Latimer at 3-425
3
Types of Torrens title ownership of
land
Single dwelling on land (freestanding house)
Strata Title :Examples include:- Apartments in blocks, townhouses,
- Retirement village
Strata title is a type of Torrens Title, governed by specific
legislation.
See Latimer at 3-195
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Types of Co-Ownership of Land
Co-owners of land may own the land either as:
joint tenants or
tenants in common
Note tenants means owners in this context.
See Latimer at 3-160 to3-190
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Joint Tenancy
Joint tenants have the same interest over the
whole land eg half shares, quarter shares etc
Joint tenants are like a single owner of the whole
land
Joint tenants cannot sell or leave their share by
will during the joint tenancy
Joint tenants have right of survivorshipee Latimer at 3-160 to 3-180
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Joint Tenancy
Doctrine of Survivorship:
When one party dies, the other automatically
gets their interest
See Latimer at 3-180
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Tenancy in Common
Tenants in common own a separate and undivided
interest in the land
Tenants in common own a proportionate share of the
land
Shares need not be in equal shares and can be dealt
with separately
Often used in business : eg Business partners co-owning
business premises.
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Tenancy in Common
No doctrine of survivorship
When a tenant in common dies, s/he can leave
their share to someone else
Tenant in common can sell their share to
outsider
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Types of interests in land
Complete and unlimited ownership (Freehold estate or Estate infee simple): owner can do whatever s/he likes, within the law
Life estate: use of property for life but cannot give it away in yourwill
Estate in remainder: cannot use the property until the life estateholder dies
Future interests (Expectant estate/estate on expectancy): rightto the land at some future time
Native title: only exists on Crown land
ee Latimer at 3-155
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Leases
Landlord = lessor
Tenant = lessee
Leases can be:
Fixed term, with definite start/end date
Tenancies at will, with definite start date but will
continue indefinitely until terminated by one of the
parties, usually giving one months written notice.
Residential or Commercial leases
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Leases
SIDENTIAL LEASEverned to a large extent by
ute law (NSW Residential
ancies Act 1987).rms of the lease and statute
erns conditions.
r exampleQuiet enjoyment
Premises to be reasonablyhabitable at start of lease
Landlord must maintain thepremisesTenants must maintain
premises in a reasonably clean
conditionPay rent on time
Allow landlord to inspect on
reasonable notice
COMMERCIAL LEASELess regulated but note RetailLeases Act 1994in relation to
shops.Terms of the lease and statute
governs conditions.
Should be registered if 3 years orover.
Usual conditionsQuiet enjoyment
Pay rent on timeNot assign or sublet withoutlandlords consent
Pay outgoings
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Transferring ownership of property
Transfer by agreement:
Sale
Gift
Assignment by deed
Declaration of trust
Inheritance under a will
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Transferring ownership of property
Transfer without agreement:
Administration of an intestate estate
Compulsory acquisition
Court order
Execution of a court order
Death of joint owner in joint tenancy
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Conveyance of real property
General procedure:
Preparation of the written contract
Exchange or signing of contracts
Searches and inquiries
(Arranging finance)
Settlement
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Conveyancing
Property
Listed for sale
Offer accepted
by Vendor
Exchange -
Contracts
Exchanged anDeposit Paid
Purchaserconducts
enquiries
Purchasersends Transfer
to Vendor
Purchaser signsTransfer and
pays stamp duty
Settlement Vendor hands
signed Transfer & Certificate ofTitle to the Purchaser. Purchaser
hands over the rest of the
purchase price
Registration -Purchaser lodgTransfer and Certificate of Titl
with the Land Titles Office & nCertificate of Title issued
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Property as Security
Most businesses need finance to expand
Lenders may take some type of security over the
property of the borrower
Why? If debt not repaid, lender can use the property to
partially or wholly repay the debt
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Property as Security
Examples of security for a loan:
Morgtages: Mortgage: securities over real property
Bills of Sale: mortgage over personal property given as security
Others: Hire Purchase: form of finance where hirer has option to buy at
of hire agreement Pledge: for example, a pawn shop where owner retains ownersh
but pawn shop in possession until obtains right to sell
Bailment: transfer of possession (but not ownership) of goods fospecified purpose (eg storage/security)
Charge: security over company property Fixed charge (fixed over certain assets which cannot be dispo
of without lenders consent)
Floating charge (does not relate to specific asset but floats oassets until event of default then it becomes fixed)
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Property as Security
curities over
al propertyMortgage
curity over
sonal property
Bill of Sale (or
SecurityInterest). This is
a mortgage.
Registration
At Land Titles OfficeunderReal Property
Act1900
Personal Property
Securities Register underthe Personal Property
Securities Act 2009 (Cth)
curity overmpany property
Fixed ChargeFloating Charge
Australian Securitiesand Investments
Commission under the
Corporations Act2001
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Intellectual Property
OverviewOn completion of this week in you should be able to:
9 Understand the reasons why the law protects intellectual property.
9 Understand why it is advantageous to seek to protect intellectual
property.
9 Describe some of the difficulties associated with protecting
intellectual property.
9 List and describe in relation to each form of intellectual property:
9 What it protects
9 How it gives that protection
9 What it entitles the holder of the intellectual property to do9 How the holders rights can be infringed
9 What they can do about this
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Intellectual Property
Involves rights that provide protection to creative and
intellectual works
Includes laws relating to:
Copyright
Designs
Patents
Trademarks
Confidential Information
ee Latimer at 3-470 to3-690
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Copyright
Most significant area of intellectual property
Established by statute: Copyright Act 1905(Cth)
now the Copyright Act 1968(Cth)
Gives person who owns the right, exclusive
rights in relation to that property
Is NO REGISTRATION system
For example:
Exclusive right to reproduce, publish or perform an
original literary, dramatic, musical or artistic work
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Copyright
Also covered:
Sound recordings
Cinematograph films
Television and sound broadcasts
Published editions of works
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Copyright
Ideas themselves are not able to be
copyrighted, only EXPRESSIONS of ideas.
Cases:
Donoghue v Allied Newspapers Ltd
Zeccola and Universal City Studios Inc
See Latimer at 3-490
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Copyright protection
Connecting Factors.
Must be in material form work in writing or
some other form expressions of ideas
Work first published or made in Australia
Author is a qualified person (ie: Australian
resident or Australian citizen)
Originality
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Copyright
Duration of the protection
Copyright Act 1968(Cth) s 33
Where the work was unpublished or unperformed
prior to death - 70 years after first
publication/performance
Otherwise, 70 years from death of author
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Copyright
nfringement:
By copying or reproducing
By importing pirate copies
By dealing (selling/hiring/distributing) pirate copies
Parallel imports
Importing genuine products/works made overseas withoutthe approval of original copyright owner
ee Latimer at 3-520
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Authors moral rights
The Copyright Act 1968(Cth) recognises three
moral rights:
1. the right of attribution (ie authors right to be
acknowledged/given appropriate credit for the work)
2. the right not to have authorship of a work falsely
attributed
3. the right of integrity of authorship (eg not changing a
novel)
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Remedies for copyright infringement
Statutory remedies:
Injunction
Damages
Account of profits
Criminal proceedings
Case: Le v The Queen
Common law remedies:Tort of passing off
See Latimer at 3-540
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DESIGNS: Designs Act 2003 (Cth)
Protects overall appearance of the product
resulting from one or more visual features of the
product (s.5)
Design protection comes from registering thedesign with IP Australia.
Must be:
1. New (not identical to another design);and
2. Distinctive (not substantially similar in overall
impression to another design)
Protection for 10 years
See Latimer at 3-550
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Patents: Patents Act 1990 (CTH)
A patent is a temporary monopoly by
which the inventorgets the exclusive
se of and right to sell a new
nvention, in return for public
isclosure (by way of publication of the
atent specification)
See Latimer at 3-580
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Patents:Patents Act 1990 (CTH)
2 types of patents:
1. Standard (20 years protection)
2. Innovation (8 years protection) considered less inventive
Requirements: Invention must be:
A. A manner of manufacture (ie relatesto a commercially useful activity)and
B. Be new, and
C. Be useful, andD. Inventive step (standard patent)
or innovative step (innovation patent)
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Trademarks:rade Marks Act 1995 (Cth)
A trade mark is a sign used, or intended to be used,
to distinguish goods or services dealt with or
provided in the course of trade by a person from
goods or services so dealt with or provided by any
other person (s.17)
Initial registration of a trade mark lasts for 10 years
but can be extended indefinitely
Applications for registration are examined for their
validity against existing registrations and whether
there are grounds for rejection
ee Latimer at 3-65066
Examples of Trade Marks
Colour trade marks (eg Cadbury chocolate)
Scent trade marks
Shape trade marks (Coca-Cola Companycase, Latimer
at 3-650)
Sound trade marks
See Latimer at 3-650
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Protection of Confidential Information
onfidential information may be protected:
by contract; and/or
by an equitable action for breach of confidence
o establish a breach of confidence:
The information must be secret or confidential
The information must have been given in circumstanceswhere the recipient knew of should have known it wasconfidentialThere was unauthorised use of the information to thedetriment of the person communicating it
ee Latimer at 3-685
Next lecture
Week 10: Tuesday 8 October (recorded for Monday
stream)
Week 11: Monday 14 October (next face-to-face lecture
for Monday stream)
Do not miss the lectures on this NEW AND
IMPORTANT TOPIC: Introduction to Tort Law, see
Latimer ch 4