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ARTICLE · 23 MAY 2024

It's just a non-binding offer…or is it?

Clifford Gouldson Lawyers
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A court may determine that a binding and enforceable agreement has been reached from a "preliminary" offer.

AustraliaCorporate/Commercial Law
Amanda Tolson
Amanda Tolson
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Letters of offer, statements of intent, heads of agreement, expressions of interest, terms sheets...they're all documents that a person might be asked to sign before they enter into a commercial transaction.

That commercial transaction might be an offer to buy a property, an offer to buy a business or a company, an offer to lease premises or an offer to extend finance to an intended borrower. The list really is endless.

While many of these may in fact be non-binding, it pays to seek advice before signing anything as you may unwittingly find yourself bound to some or all of the terms contained in these seemingly innocuous documents.

Some examples that we have seen in practice include:

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