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Albany and the Great Southern
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The danger of being a guarantor/franchisee etc…

Case in the news this week:

http://www.abc.net.au/news/2018-05-21/pensioner-eviction-guarantor-loan-westpac-banking-commission/9784426?section=business

Summary:

Carolyn Flanagan cannot read or write, but used her home to guarantee daughter’s business loan through Westpac.

Increasingly, organisations are requiring solicitors to provide advice to the other party in a transaction. Commonly this is banks instructing a guarantor to get advice to perhaps not do like Ms Flanagan, but also franchisors need to ensure that a franchisee understands the nature and effect of the franchise agreement, people selling a business subject to regulations want to ensure the other party understands it.

Ensuring each party understands the consequences of what they are entering, particularly if a party has some personal interest in the contract, transfers the liability from the lender/franchisor/stronger party, it ensures finality of contract, and avoids litigation and damage to reputations.

 

By | 2018-05-26T09:36:07+00:00 May 22nd, 2018|Springdale News|Comments Off on The danger of being a guarantor/franchisee etc…