Wentworth Lawyers Better Boards Conference 2013 “But I thought we were Partners?!” Challenges, Risks and Realities of “Partnering”, “Sharing” and “Collaborating” Victor Hamit B.Ec (Acc) LLB FAICD CTA Director Wentworth Lawyers Level William Street, Melbourne Liability limited by a scheme approved under the Professional Standards Legislation

Wentworth Lawyers Memorandum of Understanding MOU

Wentworth Lawyers MOU Memorandum of Understanding Memorandum of Agreement Statement of Intent Statement of Agreement Heads of Agreement Statement of Principles Statement of Undertaking Letter of Intent

Wentworth Lawyers MOU – Critical Factors Intention to create legal obligations  Yes  No  In part Certainty  What is it that we are trying to achieve?

Wentworth Lawyers Certainty can assist Non Binding MOU “By working co-operatively within mutually beneficial working arrangements and within an accessible and integrated service framework …” Legal Status “Legal status: This MOU is not legally binding” MOU

Wentworth Lawyers Non Binding MOU – Perceived Advantages and Uses parties feel “bound” greater moral commitment reduces risk of misunderstanding expression of intent to third party “aide memoire” for formal contract parties not legally bound MOU

Wentworth Lawyers MOU Partly binding examples  Confidentiality  Dispute Resolution  Intellectual Property

Wentworth Lawyers MOU Why are we doing this? What do we want out of it? Risks Creating legal obligations when not intended Not creating legal obligations when intended Potential liability

Wentworth Lawyers MOU Do both parties have an agreed view of what these terms mean? “Partnering” “Sharing” “Collaborating”

Wentworth Lawyers MOU “Partner”  A sharer or partaker, an associate  One of two people sharing a relationship, as a married couple  One’s companion in a dance  A player on the same side with another in a game  (Plural) Nautical fore-an-aft vertical metal plating fitted underneath a ship’s deck to strengthen it where it is cut for a mast, capstan, pump, etc. Macquarie Dictionary – Revised Third Edition

Wentworth Lawyers MOU Partnership  The state or condition of being a partner; participation; association; joint interest  Cricket the period during which the two people batting stay at the wicket together, usually with reference to the runs scored by them Macquarie Dictionary – Revised Third Edition Partnership – legal definition  The relation that exists between persons carrying on a business in common with a view to profit Butterworths Concise Australia Law Dictionary Third Edition Partnership – MOU definition  “Partnership means two or more organisations working together based on a shared vision to achieve common goals”

Wentworth Lawyers MOU Common risks  Identify the parties  Binding, not binding or part binding (be clear)  Confidentiality and Privacy  Media statements  IP ownership  Risk assessment – potential for liability (who bears it)  Dispute resolution  Objectives/outcomes

Wentworth Lawyers MOU - Summary Clarify your purpose or objectives Legal obligations? Certainty Be clear Think risk assessment – potential for liability Inevitably lack of clarity leads to unhappiness

Wentworth Lawyers

Better Boards Conference 2013 “But I thought we were Partners?!” Challenges, Risks and Realities of “Partnering”, “Sharing” and “Collaborating” Victor Hamit B.Ec (Acc) LLB FAICD CTA Director Wentworth Lawyers Level William Street, Melbourne Liability limited by a scheme approved under the Professional Standards Legislation Disclaimer: This presentation is of a general nature only. Legal advice should be obtained in relation to any specific circumstances.