Question 1

Who can be the Promisor and the Promisee?

Accepted Answer

The Promisor can be a related party if a contribution is seeking to be made however, it must be short-term accommodation otherwise it may become a loan. The Promissee may transfer or assign the PN to another party subject to the terms and conditions of the PN.

Question 2

What is the accommodation rate?

Accepted Answer

The rate for PN may be nil for very short term or set at a relevant interest rate as between the two parties to the PN.

Question 3

What happens on the death of Promisor?

Accepted Answer

If the Promisor dies the PN is terminated and becomes immediately payable.

Question 4

Deed of Promissory Note

Accepted Answer

The LYD Deed of Promissory Note (PN) is a short-term promise to pay an amount paid to the issuer of the PN by the note holder. It may be transferred and can be used as a cash equivalent. Please note: This is a short term Promissory Note only and the term should be for a period no longer than 6 months. A SMSF Trustee Promisee should be no more than 3 months. ► $129.00 (inc GST) - OR provided under your unlimited membership. ► The master document has been signed off by LY Legal and is congruent with Australian law.

Question 5

How long does this document take to assemble?

Accepted Answer

Depending on the complexity of the data, this document should take approximately 10-25 secs to assemble. If you experience timing outside of this please contact Support via the Surge app, alternatively please read this article for troubleshooting tips https://info.lightyeardocs.com.au/supportcentre/troubleshooting-longer-assembly-times-timeouts .

Question 6

Deed of Promissory Note

Accepted Answer

The LYD Deed of Promissory Note (PN) is a short-term promise to pay an amount paid to the issuer of the PN by the note holder. It may be transferred and can be used as a cash equivalent. Please note: This is a short term Promissory Note only and the term should be for a period no longer than 6 months. A SMSF Trustee Promisee should be no more than 3 months. ► $129.00 (inc GST) - OR provided under your unlimited membership. ► The master document has been signed off by LY Legal and is congruent with Australian law.

Question 7

Can the PN be used for an SMSF LRBA?

Accepted Answer

The PN cannot be used as a related party loan for an SMSF LRBA. Advisers should use The LYD RPA – Related Party LRBA meeting ATO guideline – PCG 2016/5 RRPL which has the following ten documents compiled into one process:

A Product Disclosure Statement
The Commissioner’s guideline PCG 2016/5 as a reference for compliance purposes
Trustee Minutes upgrading the deed and authorising the acquisition of a single acquirable asset under a Holding Trust
SMSF Deed Upgrade plus Minutes
Investment Strategy covering asset and loan
Holding Trust establishment plus Minutes
Related Party Loan
Mortgage Deed
Personal Guarantee (optional)
Lease if asset to be used for rental income (optional)

Question 8

Is this document a legal document?

Accepted Answer

All master documents have been signed off by LY Legal lawyers. Tony Anamourlis of LY Legal advises that “at no time, due to inbuilt legal protection and security measures can a user change or amend a document on the LYD platform that has been signed off by a practicing solicitor. To do so would result in the user drafting a document of a legal nature and engaging in the provision of legal services. In addition, it would be a breach of copyright. In our opinion when completing the form fields through the LYD platform, users and their employees are merely carrying out an administrative task which is not the provision of legal advice.”

However in some complex areas such as the insertion of a varied range of client instructions into a Will or other such documents the user must be mindful of the extent to which a document is being drafted by the user rather than merely the administrative task of completing a form where the relevant fields are inserted into the reviewed and signed legal document provided by LY Legal.

The above advice is born out of numerous cases dating back to Re Sanderson, Ex parte Law Institute of Victoria [1927] VLR 394, 397 where the Court held:

“if a person does a thing usually done by a solicitor, and does it in such a way as to lead to the reasonable inference that he is a solicitor – if he combines professing to be a solicitor with action usually taken by a solicitor – I think he then does act as a solicitor.”

Likewise in ACCC v Murray (2002) 121 FCR 428, 448 where Murray was building a franchise business that involved the legal writing and drafting of Wills from scratch based on the client’s personal circumstances. The Court held that this process was legal work.

Question 9

Is the document easy to read?

Accepted Answer

All LYD products are written in plain English and assessed for readability. If at any time you come across any errors, please contact support@lyd.com.au.

Question 10

What lawyers sign off on LYD documents?

Accepted Answer

All LYD documents are prepared and signed off by LY Legal.

Question 11

Are the LYD documents reviewed regularly?

Accepted Answer

All LYD documents form part of the LYD internal review process. We review all documents at least annually or when required to do so due to changes in legislation. Further details of this process and a review schedule is include on this website.

Question 12

Can I get a sample of this document?

Accepted Answer

Yes, please email support@lyd.com.au to request a sample document for you to review.