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ARTICLE · 14 OCTOBER 2020

Selling your business: common mistakes

Madgwicks
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Outline of 2 of the most commonly litigated areas after a sale of a business & some tips to minimise the risk of being sued.

AustraliaCorporate/Commercial Law
Catherine Ballantyne
Catherine Ballantyne

After a sale of business is completed we see people being sued for the same issues again and again. We have outlined below two of the most commonly litigated areas and some tips to minimise the risk of being sued.

Misleading and deceptive conduct

This is usually where a purchaser says they relied on a false representation made by the seller (or their agent) which induced them to purchase the business. The false representations are often made in conversations leading up to the signing of the contract.

Tips:

  • Make sure that any conversation is recorded in writing. An email after a conversation confirming what was said is best.
  • Do not provide any information which is not 100% factual and cannot be supported by documents.

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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. Madgwicks is a member of Meritas, one of the world's largest law firm alliances.

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