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Business Law, Consumer Credit, Health and Safety, Technology Law
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Health and Safety at Work Amendment Act 2026

Since we published the Winter 2026 edition of Commercial eSpeaking, the Health and Safety at Work Amendment Act 2026 has received Royal Assent and will come into force on 1 April 2027.

The Act introduces ‘critical risk’ as a defined concept – being risks associated with hazards under Schedule 1A or risks likely to result in death, notifiable injury, illness, incident or occupational disease, and requires businesses to prioritise managing these risks above others.

If you employ fewer than 20 people, your health and safety duties will narrow specifically to critical risks, rather than covering every possible workplace risk. You’ll still need to meet baseline obligations, including providing adequate employee facilities (for example: toilets, drinking water and hand-washing facilities) but this change is intended to reduce the compliance burden for smaller businesses.

The Act also clarifies the duty owed by a Person Conducting a Business or Undertaking (PCBU) where its workplace includes outdoor space used for recreation. In specified circumstances, the PCBU will not owe the usual section 37 duty to people entering and using that space for recreational purposes, unless:

  • The recreational use is part of a PCBU’s business or undertaking, or
  • Other work connected to a business or undertaking conducted by the PCBU is being carried out at the time in the outdoor space near where the entry and use are taking place.

If your business already complies with industry-specific legislation, the Act confirms this will satisfy your obligations under the Act too, without needing to separately comply with the Act.

Businesses should begin reviewing their health and safety processes and policies now, ahead of the 1 April 2027 commencement date.

 

AI in the workplace

AI tools are becoming a standard part of many workplaces, used for everything from drafting documents to customer service and research. Used safely, AI may increase efficiency, but it is important to manage the associated risks and put the right safeguards in place.

Some key risks in practice include, without limitation:

  • Confidentiality: Trade secrets or confidential information entered into an AI tool could be disclosed, retained or used to train the tool
  • Privacy: Entering personal information into an AI tool may amount to a disclosure under the Privacy Act 2020
  • Intellectual property: AI-generated content isn’t automatically free of copyright issues, and outputs may infringe someone else’s protected work, and
  • Human oversight and transparency: AI output should be reviewed before it’s relied on, to guard against errors, bias or hallucinated content.

Some practical controls may include, without limitation:

  • Paid subscriptions: Paid subscriptions to AI tools generally offer stronger safeguards than free versions, but your business will need to check the specific terms that apply
  • Data audit: To take stock of what data the business holds, who can access it and whether use of an AI tool would give people wider access than they’re meant to have, and
  • AI policy: To set clear expectations around which AI tools are approved for use, what types of information staff can and cannot put into them and the process for reviewing and signing off on AI-generated output before it’s relied on.

There is more guidance in the Ministry of Business, Innovation and Employment’s publication Responsible AI Guidance for Businesses. Click here to read it.

 

AI in the boardroom

A recent Federal Court of Australia decision has offered a timely warning on AI’s growing role in the boardroom.[1] The court also commented on AI use, warning that AI-generated summaries are not a substitute for directors actually reading and engaging with board materials themselves.

While the decision is not binding in New Zealand, directors here are subject to their own duty of care under the Companies Act 1993 that requires directors to exercise the care, diligence and skill of a reasonable director.

This duty applies regardless of whether AI is involved in a director’s decision-making process. If a director relies heavily on an AI-generated summary without checking it against the underlying material, they may struggle to demonstrate that they exercised the care, diligence and skill required by the Act.

As AI becomes more prominent in board processes and decision-making, this is a useful reminder that directors must properly engage with information and exercise independent judgement rather than relying solely on AI-generated material.

 

Reporting, liability and disclosure changes for consumer credit providers

On 1 July 2026, the Financial Markets Authority (FMA) took over responsibility for regulating the Credit Contracts and Consumer Finance Act 2003 (CCCFA) from the Commerce Commission. As part of this change, consumer credit providers including banks, credit unions and other lenders are now licensed under the Financial Markets Conduct Act 2013 (FMCA).

 

Reporting

Section 412 of the FMCA requires licensees to inform the FMA as soon as they believe they’ve breached, or are likely to breach, a licence obligation or if there has been, or is likely to be, a material change in circumstances, or where certain particulars are false or misleading.

While other types of FMCA licensees have been subject to this for years, this is new

for consumer credit providers who have not had to comply with this until now.

The obligation to report arises as soon as the licensee believes a breach may have happened or may be about to happen. Getting this timing wrong, or failing to report at all, can result in a penalty of up to $600,000.

 

Director and senior manager liability

Directors and senior managers of consumer credit providers no longer have a personal due diligence obligation under the CCCFA. Personal liability arises instead under the existing FMCA regime and requires involvement in a breach.

 

Disclosure

Under the CCCFA, courts may order a debtor not liable for borrowing costs where appropriate disclosures have not been made by consumer credit providers. This is triggered by way of application from a debtor or the FMA, where courts may consider factors including, without limitation, the provider’s compliance programmes and prejudice caused to the debtor.

For more detailed information about these changes, click here.

[1] ASIC v Bekier (Liability Judgment) [2026] FCA 196.

 

DISCLAIMER: All the information published in Commercial eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Commercial eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Content Copyright © NZ LAW Limited, 2026.    Editor: Adrienne Olsen.       E-mail: [email protected]      Ph: 029 286 3650

Big changes coming to holiday pay

Business, Employment, Employment Law, Holidays Act, Legislation, Workplace Regulation
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Employment Leave Act 2026 comes into force in 2028

The Employment Leave Act 2026 became law on 6 August 2026. It heralds the biggest changes to the administration of employee leave since the Holidays Act was passed in 2003, more than 20 years ago. The legislation, however, is not due to take effect until 6 August 2028, so there is plenty of time for employers to prepare.

 

Why is it changing?

The current system has proved to be complex and especially challenging to apply to employees who have variable working hours or variable pay through commissions. This has led to a number of well-publicised instances of large public sector organisations having incorrectly paid a large number of their employees for their leave over a substantial period. It is likely that this has happened in the private sector as well.

The situations which have occurred in the public sector have garnered more publicity, given the transparency that applies to public sector organisations.

For example, Health New Zealand, that took over from the 24 former district health boards, is currently going through a complex process of identifying and correcting errors with holiday pay dating back to 2010. Health New Zealand has budgeted $1.8 billion to make up previous short payments to its staff for leave. It is also spending tens of millions of dollars on the investigative and administrative work associated with identifying and correcting these errors.

 

What is changing?

The fundamental change to be introduced is a switch to calculating leave on an hourly basis. The Act also distinguishes between ‘standard hours,’ ‘additional hours’ and ‘casual hours.’ Broadly, ‘standard hours’ are an employee’s ordinary hours, while ‘additional hours’ are hours worked beyond those standard hours. ‘Casual hours’ are hours worked by a casual employee. The legislation retains the ability for an employment agreement to state that an employee’s salary covers all hours worked.

The general rule will be that annual leave will accrue at the rate of 0.0769 hours for each hour worked. Sick leave will accrue at the rate of 0.0385 hours.

Other significant changes include:

  • Employees will accrue both annual and sick leave as soon as they begin working. They will no longer have to work for a year before being entitled to annual leave and six months before being entitled to sick leave
  • Employees will only accrue annual leave for their normal working hours. They will not accrue leave for any additional hours worked. Instead, they will receive an immediate payment of 12.5% of their normal hourly rate for all qualifying hours worked in excess of their normal working hours
  • Employees will be able to take both annual and sick leave on an hourly basis. They may take one or two hours off work for a medical appointment. Under the current law, technically, they may be required to take a full day’s leave for this
  • Both annual and sick leave will accrue when an employee is on paid leave or any unpaid leave authorised by any legislation, including parental leave. Leave will not accrue, however, when an employee is receiving accident compensation support
  • An employee will accrue additional leave for each hour that they work on a public holiday if that day is a normal working day for them, and
  • Employers and employees will be able to agree for employees to ‘cash out’ up to 25% of the value of the annual leave. At present, the limit is one week’s leave.

 

What do you need to do now?

As an employer, there is nothing that you need to do immediately. The legislation does not come into effect for two years. In the meantime, however, you need to ensure that your payroll system can handle the changes when they come into effect.

Payroll software providers are aware that they must update their software to enable it to implement the new system when it comes into effect.

Watch out for communications from your payroll software provider. You should also bear the upcoming changes in mind if you are considering changing your payroll system.

You must also update the leave provisions in your employment agreements. The Act allows employers a further year after the legislation comes into force on 6 August 2028 to ensure that all employment agreements are updated.

Employers must continue to comply with any provisions in their employment agreements that are more favourable to employees than the Act during this first year. The minimum statutory terms will override any employment agreement that remains unchanged at the end of this period.

If you need guidance on updating your staff’s employment agreements, or any other aspects of this new legislation, please don’t hesitate to contact us.

 

 

DISCLAIMER: All the information published in Commercial eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Commercial eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Content Copyright © NZ LAW Limited, 2026.    Editor: Adrienne Olsen.       E-mail: [email protected]      Ph: 029 286 3650

What’s in a name?

Business Law, Intellectual Property, Legal Technology, Trademarks & Branding
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Brand protection in the age of AI

An apple with a bite taken out. A golden ‘M.’ ‘Just Do It.’ The power of a punchy slogan or well-designed logo to immediately identify a business is immense, tapping into a deep-seated part of our psyche as consumers. A good brand inspires trust, implies integrity and creates emotional connection. It’s also a valuable piece of intellectual property.

A good brand, however, also costs money. Marketing and advertising, graphic design and social media experts: it all adds up, particularly for small businesses where every dollar counts. That is why many businesses are turning to the latest tech toy – generative AI. ChatGPT and other AI tools can create professional-looking branding in seconds for a tiny fraction of the market cost.

Under OpenAI’s terms of use, you own any output generated by ChatGPT or its other applications based on prompts or information you input,[1] meaning you potentially own a piece of intellectual property which can contribute to the value of your business. Logos or slogans created by AI might even qualify to be registered as trade marks.

 

So what’s the risk?

Trade marks have been used and relied upon for hundreds of years by traders seeking to distinguish the goods or services they offer from those of other businesses. They attract a goodwill value to a business as a recognisable symbol of the products on sale, as well as providing an enforceable means of protection against less scrupulous traders who might seek to sell the same or similar products under a pretence of connection.

Under the Trade Marks Act 2002, to be eligible for registration, a trade mark must:

  • Have a distinctive character.[2] It cannot just be a description of goods or services, and
  • Not be similar to an existing trade mark for similar goods or services, or otherwise be likely to cause confusion.[3]

Even without registration, a business may have protection under the common law tort of passing off, as well as under provisions of the Fair Trading Act 1986 that prohibit misleading or deceptive conduct and certain conduct concerning trade marks.

OpenAI gives no warranty or representation, however, that the brand it creates will meet trade mark eligibility criteria, or be sufficiently distinctive to you to justify a passing off claim. In fact, its Terms of Use expressly acknowledge that due to the nature of the services provided, outputs may not be unique, and ‘other users may receive similar output.’ This means there is no guarantee that your AI-generated brand will not be the same as or similar enough to someone else’s mark to cause confusion, limiting its value as a trade mark in terms of goodwill and reducing its enforceability against potential fraudsters.

Using generative AI to create a brand might also leave you open to trade mark infringement or passing off claims by existing trade mark owners. OpenAI’s terms expressly state that a user is responsible for their own output, including that it does not violate any applicable laws.

ChatGPT does not run any clearance checks to ensure that the branding that it generates for a user does not use or infringe the intellectual property of any other party.

Generative AI models are trained using large datasets, which may include material created by third parties. The legal implications of that training, and of particular AI-generated outputs, are still developing. Businesses should therefore not assume that AI-generated material is free from third-party intellectual property risks.

 

No legislative guidance here

New Zealand does not currently have an AI-specific legislative regime. The current government has indicated that it will take a ‘light touch’ approach to regulation and courts will likely follow guidance from overseas. Existing laws, including privacy, consumer protection and intellectual property laws, continue to apply to AI use.

For now, the onus is on you to ensure that your AI-generated branding is sufficiently distinctive and original – not only to provide the goodwill value of a trade mark, but also to protect your business against passing off claims. MBIE has published voluntary guidance for businesses on the responsible use and development of AI. To read this, click here.

To ensure protection against passing off and defence against third party infringement claims, getting our advice will be your safest bet.

[1] https://openai.com/en-GB/policies/terms-of-use/

[2] Trade Marks Act 2002, s18.

[3] s17(a).

 

DISCLAIMER: All the information published in Commercial eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Commercial eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Content Copyright © NZ LAW Limited, 2026.    Editor: Adrienne Olsen.       E-mail: [email protected]      Ph: 029 286 3650

Trusts can protect assets

Criminal Law, Estate, Estate Planning, Property Law, Trust Law, Wills & Estates
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But they cannot ring fence assets derived from fraud

On 26 March 2021, John Bracken was convicted of New Zealand’s largest GST fraud having fraudulently obtained $17,311,262.29 in GST refunds over a period of four years.

On 23 February 2026, the Commissioner of Police applied to the High Court for a profit forfeiture order over property in which Mr Bracken had an ‘interest.’ In other words, the Commissioner sought to recover assets unlawfully obtained from Mr Bracken’s criminal activities.

The most valuable assets acquired from Mr Bracken’s criminal activities, however, were held by the Bracken Family Trust and not himself personally.

Despite this, under the Criminal Proceeds (Recovery) Act 2009 (CPRA), the court determined that the trust must forfeit $13 million of its own assets in response to Mr Bracken’s offending as he had an ’interest’ in the trust property.

 

Criminals may not profit from their actions

For the court to make a profit forfeiture order, it had to be satisfied that Mr Bracken had ‘unlawfully benefited from significant criminal activity’ and that he had ’interests’ in property.

It was quite clear that Mr Bracken had unlawfully benefitted from a significant criminal activity, so the question turned to whether he had an ‘interest’ in the trust’s property.

Discretionary beneficiaries cannot usually be said to have an ‘interest’ in trust property, because the property is legally owned and controlled by the trustees, not the beneficiaries. Discretionary beneficiaries do not have a legal right to the trust’s property, only a hope that the trustees might decide to distribute something to them, or that they will receive what is left when the trust comes to an end.

The Bracken Family Trust was unusual though, because Mr & Mrs Bracken had reserved a lot of power to themselves: they were settlors, trustees, discretionary beneficiaries, final beneficiaries and, as ‘Principal Family Members’, had the power to remove beneficiaries, and appoint and remove trustees.

Moreover, under the CPRA, an ‘interest’ in relation to property is much broader than simply owning something. It includes not only a legal or equitable interest in property, but also a right, power or privilege connected with the property.

In addition, the court can treat having ‘effective control over property’ as an ‘interest in property.’ As a part of this analysis, the court can have regard to ‘any trust that has a relationship to the property.’

The court determined Mr Bracken had both:

  1. An ’interest’ in the trust property both because he was a final beneficiary of the trust and due to his powers as a ‘Principal Family Member,’ and
  2. Effective control over the trust property, which was also due to his powers as a ‘Principal Family Member’ and that he was a trustee.

After much complex legal argument, the profit forfeiture order was granted with a maximum recoverable amount of $16,019,231.16, around $13 million of this was trust-owned property. The trust could retain the family farm (valued at $3.780 million), as this would allow the innocent beneficiaries to continue to benefit from this generational family asset. All the other remaining trust property was to be forfeited.

 

Trusts cannot shield ill-gotten gains

This case shows that while well-drafted trusts remain valuable and legitimate estate planning tools, they cannot be used as a shield for assets that have been acquired through crime – particularly in cases where the perpetrator has retained so much power over the trust assets that such power is tantamount to property (or an ‘interest’).

The court’s decision was said to be a strict statutory interpretation exercise, and there are clearly legitimate policy (and societal) reasons behind the CPRA having such a strong stance. It remains to be seen, however, whether a case involving a trust over which a criminal has few or no powers would result in the same outcome.

This case shows an intriguing relationship between statutory intervention and orthodox trust principles – giving us much to ponder.

 

 

DISCLAIMER: All the information published in Trust eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Trust eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Content Copyright © NZ LAW Limited, 2026.    Editor: Adrienne Olsen.       E-mail: [email protected]      Ph: 029 286 3650

Review of adult decision-making capacity law

Elder Law, Estate Planning, Family Law, Legal Guidance, Property Law, Wills & Estates
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Law Commission recommendations

The Law Commission recently reviewed the Protection of Personal and Property Rights Act 1988 (PPPR Act). This legislation governs how decisions are made for adults who lack capacity and can no longer make some decisions for themselves.

The PPPR Act applies widely; it includes adults who have declining capacity due to dementia, lack capacity due to intellectual disabilities or have a temporary loss of capacity (for example) due to injuries.

The Commission has made a number of recommendations for reform, particularly regarding property managers and welfare guardians who are appointed by the court to make decisions for people who cannot make decisions themselves.

 

Overall approach

The Commission recommends repealing the PPPR Act and replacing it with new legislation. The biggest shift is away from asking what is in a person’s ‘best interests’ (often considered paternalistic), and towards asking what the person’s own wishes, values and rights are, and how those can be respected.

Court-appointed decision-makers would be expected to support the person’s participation in decisions wherever possible; they would only step in to decide for them where genuinely necessary.

 

Changes to the roles of property managers and welfare guardians

The Commission also recommends renaming ‘property managers’ to ‘property representatives’ and ‘welfare guardians’ to ‘welfare representatives.’ The change reflects a shift in emphasis: these representatives would not simply make decisions they think are best, but would instead be required to represent the person’s wishes and values as far as possible.

Representatives would have clearer statutory duties. They would be required to act honestly, in good faith and with reasonable care, understand the person’s circumstances, support the person to participate in decisions, communicate in a way the person can understand, respect the person’s rights, and make decisions centered on the person’s wishes and values.

The scope of appointments might become more limited than they are currently. Representatives would only make decisions that the person lacks capacity to make and only where someone else genuinely needs to make those decisions. If a person retains capacity for some decisions, they would continue making those decisions themselves.

Property representatives would continue to have financial reporting obligations, and the existing financial limits on decisions they can make without court approval would be modified.

Welfare representatives could also be made subject to reporting requirements where appropriate. Representatives would also be expected to notify the court if significant changes occur that affect their suitability or the ongoing need for the appointment.

The court would have greater flexibility to tailor appointments. It could appoint multiple representatives, divide responsibilities, impose reporting obligations, require consultation between representatives and include safeguards where conflicts of interest exist.

Where a representative is also a spouse or partner, conflicts of interest would not prevent appointment, but specific conditions might be imposed from the outset to ensure conflicts of interest are handled appropriately.

 

Reasons for the proposed changes

Currently, many court-appointed representatives are family members with no legal training. The Law Commission found that the current duties are scattered between the PPPR Act and case law, making the roles difficult to understand. It recommends a single, clear list of statutory duties, and clearer obligations for representatives, so they are better equipped to understand their role and responsibilities.

The current law is also viewed as not sufficiently focussed on the person for whom decisions are being made. Property managers and welfare guardians are not always aware that they need to consider the person’s rights, wishes and values, rather than just making the decision they think is best.

 

Conclusion

Overall, the recommendations focus on encouraging people to participate in decisions which affect them and make as many decisions as they reasonably can make, but supporting them where needed. Where representatives are appointed, their role is to be as limited as possible and proportional to the lack of capacity in question.

If these changes become law, representatives will have clearer obligations, and will be accountable for respecting the rights, wishes and values of the person for whom they are making decisions.

The recommendations have not yet been considered by Parliament and may still evolve before any new laws are passed. It is, however, worth being aware that the roles and obligations of property managers and welfare guardians are likely to change in the coming years.

 

 

DISCLAIMER: All the information published in Trust eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Trust eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Content Copyright © NZ LAW Limited, 2026.    Editor: Adrienne Olsen.       E-mail: [email protected]      Ph: 029 286 3650

Former Port of Auckland CEO loses appeal against health and safety conviction

Company Law, Directors’ Duties, Employment Law, Health and Safety, Workplace Safety, WorkplaceLaw
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The former chief executive of Port of Auckland Ltd (POAL), Tony Gibson, lost his appeal against his conviction under the Health and Safety at Work Act 2015 (HSWA) following the night shift death of a port worker, Pala’amo Kalati. Mr Kalati was crushed by a container while helping to unload a container ship. The High Court confirmed the District Court’s decision on the duties of an officer of a large organisation under the HSWA.

 

Failure to take steps to minimise risk

The High Court[1] confirmed that Mr Gibson had failed to take the steps that a reasonable officer in his position would have taken to minimise the risk of an accident occurring. The court agreed with the District Court that Mr Gibson was personally aware of the risks associated with loading and unloading containers, that the company’s documentation containing its rules for handling containers was unclear, and that the company had inadequate systems in place to determine whether its workers were complying with its rules.

The court also agreed that Mr Gibson should have been aware of the serious risks associated with handling containers following the 2018 death of one of the port’s workers.

The High Court also upheld the District Court’s decision to impose a fine of $130,000 on Mr Gibson and to order him to pay a further $60,000 in court costs.

The court’s decision confirms several principles relating to the duties of company officers under the HSWA, which were set down in the District Court’s decision. These are:

  • It is not enough for a company officer to ensure that systems are in place to protect workers’ safety. They must also ensure that work practices are monitored for compliance. They must ensure that they are aware of how their staff actually carry out their work as opposed to how they are supposed to do so, and
  • A company officer cannot simply delegate their health and safety responsibilities to someone else in their company and rely on that person to ensure compliance with health and safety rules, without proper enquiry that the organisation’s systems are adequately addressing health and safety risks. They must critically examine information provided to them by their staff relating to health and safety. They must also create mechanisms to verify the information they are receiving.

 

Maritime New Zealand, the government body with responsibility for health and safety prosecutions relating to ports, only charged POAL’s chief executive officer. The High Court observed that there were a number of different people at the port company, including directors and managers, who had obligations under the HSWA who could also have been charged.

This decision emphasises that both those involved in governance and operational matters in a large organisation may have personal health and safety obligations.

If you have any concerns about your health and safety obligations as a company director or senior employee, please don’t hesitate to contact us.

 

[1] Gibson v Maritime New Zealand [2026] NZHC 813.

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Fineprint may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2026.     Editor: Adrienne Olsen.       E-mail: [email protected]     Ph: 029 286 3650 

‘Doomsday’ provisions in your will

Charitable Giving, Estate Planning, Family Law, Trusts, Wills & Estate Planning, Wills & Estates
0

You may recall the tragic story of English businessman, Richard Cousins, and his family, who all died together in a plane crash in Australia on New Year’s Eve 2017.

About a year before his death, Mr Cousins amended his will by adding ‘Doomsday’ provisions. The provisions stated that if he and his family died simultaneously, the majority of his large estate would pass to his elected charity, Oxfam. Due to Mr Cousins’ foresight, Oxfam received their largest donation ever at that time of £41 million.

 

What are Doomsday provisions?

Doomsday[1] provisions (also referred to as fail safe, common catastrophe or calamity clauses) are back-up provisions in a person’s will. They set out what happens to your estate should all your beneficiaries pass away before they are able to receive their share.

This is the situation commonly referred to as Doomsday.

 

Why have Doomsday provisions?

The purpose of Doomsday provisions is to ensure that your estate passes to someone or somewhere you intend.

If a Doomsday/catastrophic situation occurs, and your will has no Doomsday provisions, uncertainty arises. The gifts in your will may fail and your estate (or the parts affected) may be distributed as if you died without a will (intestate).

In this situation, the intestacy rules set out in the Administration Act 1969 will apply. These rules set out who is entitled to your estate, even though they may not be beneficiaries in your will. Where your spouse or partner, and children have all died, your estate passes to your wider relatives in a set order, which can include:

  • Grandchildren/great-grandchildren
  • Parents
  • Siblings
  • Grandparents
  • Aunts and uncles, or
  • Half-aunts and half-uncles.

 

Ultimately, if there are no living beneficiaries to receive your estate, parts or all of it may pass to the Crown.

The prospect of such an outcome can be troubling to many people, particularly in the midst of increasingly complex family dynamics. If you have no Doomsday provisions in your will and all your beneficiaries are dead, your estate could be subject to administrative delay and litigation between those making a claim. The costs of these delays may be taken from your estate.

Planning for a ‘Doomsday’ may feel a remote or upsetting scenario. However, it is important to consider whether to include Doomsday provisions in your will. For example, if your family all travel together or all your beneficiaries are older than you, your estate is at a greater risk of being distributed in a way that does not align with your wishes without a such a clause.

 

Key considerations

When considering Doomsday provisions, it is important to take legal advice. They should be drafted to work with your family circumstances, the relevant legislation, and any other estate planning documents you have.

There are various ways a person may try to dispute your Doomsday provisions, and we can advise on strategies to reduce that risk. The more we know about your family dynamics and lifestyle, the better we can provide appropriate options.

It is particularly important that you let us know about any contracts, trusts, agreements and other documents which do, or could, affect your estate.

 

Doomsday provisions and trusts

You should also consider whether a Doomsday provision is appropriate for your family trust.

Without Doomsday provisions, a problem arises if all the trust’s beneficiaries die, or if the trust reaches its vesting date with no beneficiaries left to receive trust property. However, some trust deeds do have default beneficiary provisions to address this situation. We can assist you with reviewing your trust deed to advise you on this.

 

Adding Doomsday provisions

Adding Doomsday provisions to your will (or trust) increases certainty that your wishes will be followed and your property will be distributed to a person, organisation or cause you have chosen.

You may wish to name your siblings, close friends, iwi, religious organisations or charities as final recipients.

A charitable organisation is often a good option because charities usually remain operating long-term. Further, it provides the opportunity to help a cause that is close to your heart. And, if a charity is reliant on donations and bequests (as are most charities in New Zealand), such a donation may be life-changing for those they help.

 

[1] Doomsday, originating from Old English, usually refers to the end of the world or a day of ultimate or catastrophic reckoning.

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Fineprint may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2026.     Editor: Adrienne Olsen.       E-mail: [email protected]     Ph: 029 286 3650 

Consequences of ‘accidental directorship’

Business Law, Company Law, Corporate Governance, Directors’ Duties, StartupAdvice, Startups, Venture Capital
0

Caution for investors, startup advisers and board observers

Startup companies often rely on advisers, investors and board observers to help guide their new businesses. This is a good thing, but it carries hidden risk.

If you are in one of these roles, in some circumstances, you can be treated as a director, even if you never formally agreed to the appointment. If this happens, it can expose you to personal liability.

 

Directors vs advisers: What’s the difference?

Directors are responsible for the overall governance and strategic direction of the business.

Directorship also comes with legal compliance under the Companies Act 1993. There are significant consequences for directors if things go wrong.

On the other hand, advisers and board observers typically provide strategic, non-binding guidance for the directors to take into consideration when making decisions.

In theory, this is a clear distinction. The line, however, can become blurred. What matters is what you do in practice, rather than your title.

 

How do people become accidental directors?

This is common in startups, where governance structures are still evolving and roles are often informal. Having said that, this is still a real risk for any company. Courts tend to focus on how you are fulfilling your role as an adviser or observer in practice. Warning signs include:

  • The board of directors regularly following your instructions or directions
  • Being involved in decision-making on the same level as directors, and/or
  • Exercising authority normally reserved for directors.

If these patterns develop, you may be seen as a deemed director.

 

Personal liability

Directors’ duties are personal. If a company gets into financial trouble, the directors are exposed to personal liability, and in some instances may be required to personally contribute to company debts. This risk doesn’t just apply to those formally appointed. If you are treated as a director in substance, you may carry this risk without even realising you’ve taken it on.

 

A risk area

Board observers and startup advisers are particularly exposed because their role sits very close to the line. For example, an observer may:

  • Attend meetings and receive board papers
  • Provide input on strategy or decisions, and/or
  • Represent investor interests.

 

That’s fine, but the risk increases where:

  • You participate in decision-making on significant matters
  • The board tends to follow your recommendations
  • Your role is not clearly recorded as ‘observer only,’ and/or
  • You (or your investor) have significant control or approval rights.

Over time, what starts as ‘advice’ can start to look like decision-making.

 

This is one of those areas where things can drift without anyone noticing. Everyone is acting in good faith, wanting the business to succeed, but the legal position gradually shifts. If you are involved in a startup as an adviser, investor or observer, it’s worth asking yourself:

  • Am I just advising, or am I influencing decisions?
  • Does the board treat my input as optional or as direction?
  • Is my role clearly documented and understood?

Small changes in how you operate can make a big difference.

 

Be careful

Being an adviser or board observer is often valuable and rewarding, and is of great benefit to startups. However, there are real risks with these roles that are not always obvious. If your involvement crosses the line into decision-making or control, the law may consider you as a director, exposing you to all the responsibility and possible personal liability that comes with that title.

It pays to be clear about your role from the outset and to keep checking that your involvement hasn’t crept further than intended. If you’re not sure where that line sits in your situation, it’s a good time to get legal advice to help avoid unintended consequences.

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Fineprint may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2026.     Editor: Adrienne Olsen.       E-mail: [email protected]     Ph: 029 286 3650 

Modern Slavery Bill

Business Law, Employment Law, Human Resources, Human Rights, Legislation, Supply Chains, Workplace Law
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Implications for business

The introduction into Parliament of the Modern Slavery Bill has brought awareness of how modern slavery has manifested itself into New Zealand businesses. Modern slavery can rear its ugly head in a range of ways from forced labour in supply chains, exploitation (or coercion) of workers and various forms of trafficking.

The Bill has also made history as it is the first time a bill has been introduced through Standing Order 288. This allows a Private Member’s Bill to bypass the random ballot (or ‘biscuit tin’) process if it is supported by two-thirds of non-executive MPs.

This Bill was co-sponsored by Labour MP Camilla Belich and National MP Greg Fleming. This bi-partisan effort shows the importance of the Bill not only to our parliamentarians, but also to New Zealand society.

 

What is modern slavery?

Modern slavery is often seen as a global matter and, for many New Zealanders, it probably feels like an issue away from our shores. Unfortunately, this is far from the truth. World Vision currently estimates that the average Kiwi spends around $77 a week on goods linked to various forms of modern slavery.[1] Walk Free’s 2023 Global Slavery Index estimated that in 2021, there were 8,000 individuals on any given day, living in modern slavery in New Zealand.[2]

In a high-profile case in the modern history of slavery in New Zealand, Joseph Matamata was convicted of 13 charges of slavery and 10 charges of human trafficking involving labourers working in orchards. After bringing the labourers to New Zealand with promises of a better life, Matamata retained their income, restricted communication and movement, and used threats of violence to ensure the labourers stayed in their jobs.[3]

The Bill

The Bill is both broad and extensive in defining modern slavery. It is defined as:

  • Crimes already understood in the Crimes Act 1961:
    – Dealing in slaves, as well as debt-bondage or sefdom
    – Dealing in people under 18 for sexual exploitation, removal of body parts, or engagement in forced labour
    – People trafficking, and
    – Coerced marriage or civil union
  • The ‘worst forms of child labour’ under Article 3 of the International Labour Organisation Convention No. 182
  • Trafficking as defined by Article 3 of the United Nations Protocol
  • Forced or exploitative labour
  • Servitude, and
  • Sexual exploitation.[4]

 

Outside of the definition of modern slavery, the Bill requires the Minister to report annually on modern slavery matters, to publish guidance and to direct the Chief Human Rights Commissioner to designate modern slavery as a ‘priority area’ if necessary. The Bill will lead to the creation of a Modern Slavery Statement Register to be publicly accessible. All this will be overseen by the proposed independent Anti-Slavery Commissioner.

 

What does this mean for business?

The Bill currently states that ‘reporting entities’ are required to:

  • Prepare and publish annual modern slavery statements that describe their structure and supply chains
  • Identify modern slavery risks (both real and potential)
  • Outline what steps the entity is taking to deal with the identified risks, and
  • Lodge these statements on the Modern Slavery Statement Register.

A ‘reporting entity’ in the Bill is defined as a business with a consolidated annual revenue that exceeds $100 million. These entities not only refer to New Zealand entities, but also any overseas company carrying on business in New Zealand. These entities can be both public and private organisations, with government agencies also being captured under this regime.

 

How this affects New Zealand businesses

If your business is considered a reporting entity under the Bill, non-compliance with the regime could carry a strong penalty. Offences will be committed if entities fail to comply with their reporting obligations, or if they knowingly make false or misleading statements in their reports. These offences could amount to reporting entities being liable on conviction to a fine of up to $200,000.

From a civil point of view, the maximum pecuniary penalty for a contravening reporting entity is $600,000.

This also imposes personal liability for directors and individuals involved in management. If an offence occurs with the permission, knowledge or presumed knowledge of these individuals, they will be found guilty. This is particularly important if the director or management should have known it was occurring but failed to take reasonable steps to prevent it from happening.

The final important note for businesses is that if they are found to be non-compliant, both the name of the business and the individuals responsible will be published on the Register for three years.

 

Preparing for the Bill to become law

Many affected by the reporting obligations of this Bill may already be familiar with its obligations, considering there are similar laws in other jurisdictions. However, potential ways to prepare for the implementation of the modern slavery legislation in New Zealand could be in the form of preparing policies and governance, reviewing supply and procurement contracts (and being particularly diligent about who your suppliers are), and potentially establishing internal whistleblowing procedures.

Other steps could involve identifying risk factors that may facilitate the exploitation of workers, and developing management plans to mitigate them. The Ministry of Foreign Affairs and Trade has a range of specific resources all targeted towards combatting modern slavery.[5]

 

A positive development

This Bill is widely seen as a positive development in New Zealand law. While there may be concerns on the extent of obligations imposed on entities, the benefits to victims undoubtedly outweigh the costs. If you are concerned that this proposed legislation may affect the way you do business, please don’t hesitate to contact us.

[1]  https://www.worldvision.org.nz/about/media/parliamentary-rule-modern-slavery-act-for-nz/

[2] https://www.walkfree.org/global-slavery-index/country-studies/new-zealand/

[3] Joseph Auga Matamata v R [2020] NZHC 1829.

[4] https://www.legislation.govt.nz/bill/members/2026/242/en/latest/#LMS1569519

[5] https://www.mfat.govt.nz/en/trade/nz-trade-policy/combatting-modern-slavery

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Fineprint may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2026.     Editor: Adrienne Olsen.       E-mail: [email protected]     Ph: 029 286 3650 

Postscript

Environmental Law, Planning Ahead, Property Law, Resource Management, Rural Law
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RMA replacement legislation reported back from select committee

 

On 20 July, the select committee reported back on the Natural Environment Bill and the Planning Bill, that are set to replace the Resource Management Act 1991 (RMA). The committee received 3,204 submissions and heard presentations from 178 submitters.

Whilst key features of the new system have been retained, the select committee recommended some improvements (that the government supports) that will refine and clarify some aspects of the bills.

After feedback from a range of submitters, the timeframe to implement the transition period from the RMA to the two new statutes has been extended from 30 months to 39 months.

The Labour Party has indicated that if it forms a government in November, it will not repeal this new legislation. The party does, however, state that it has some serious misgivings about some aspects, particularly the regulatory relief provisions.

In the meantime, there is some hard work to be done to incorporate the committee’s recommendations and present the bills again to Parliament for a second reading – all before the House rises in September for the 7 November election.

For more information on the Environment Committee’s report go here.[1]

[1]  https://www3.parliament.nz/en/pb/sc/scl/environment/tab report#filterformsearchtarget 

 

Fineprint’s 100th edition!

The eagle-eyed amongst you may have noticed we are publishing the 100th edition of Fineprint. This is not only a significant milestone for any publication, but also an affirmation to all our readers, that Fineprint continues to resonate with you in terms of relevant content.

Established in April 1997, we have moved from two-colour printed hard copy to publishing a full-colour beautifully-designed edition (thank you Mission Hall Creative) as you see today. Over the years, we have shifted from hard copy only, to now mostly publishing electronically. We have moved with the times.

Our biggest thank you goes to you, our readers, who continue to enjoy reading Fineprint and have given us valuable feedback in terms of topics to cover. We will continue publishing interesting, useful and sometimes thought-provoking content that not only covers legal issues, but also the wider business and social communities. If you would like to give us feedback, please email the editor at: [email protected].

Thank you and kia ora.

 

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Fineprint may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2026.     Editor: Adrienne Olsen.       E-mail: [email protected]     Ph: 029 286 3650 

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