Commercial Property Article
01 February, 2022
Independent Legal Advice (ILA) means impartial advice provided by an independent solicitor. The idea behind an ILA is to protect an individual from signing any document before understanding the risks of the transaction. An independent advisor will sign a certificate confirming that they have provided the relevant advice, followed by their client's signature.
An ILA is commonly required in the following circumstances:
Whilst this type of ILA is normally a bank requirement, please do not underestimate the real need for this advice - it's not a formality, nor just witnessing a signature. The House of Lords in Etridge has made clarification to the law on undue influence and to avoid the risk of being sued by a guarantor, it can only be deflected by providing an ILA. Therefore, the mortgage lender requires the guarantor in a mortgage/loan to obtain ILA before the guarantee is given.
The underlying principle is to ensure that the guarantor clearly understands the transaction. A qualified solicitor will meet with the individual in person, in the absence of the borrower, and discuss the following:
For more information contact Jo Higham in our Commercial Property department via email or phone on 01772 220177. Alternatively send any question through to Forbes Solicitors via our online Contact Form.
Learn more about our Commercial Property department here