The great escape: can the guarantee you signed be enforced?

Personal guarantees are extremely common.

Chances are, one day you'll be required to sign one –perhaps as a company director, or maybe as a parent when helping your child obtain finance for their first home.

Often such guarantees are provided without much thought, simply so a transaction can progress smoothly.

But more frequently we are being approached by guarantors who are being pursued to pay up under their guarantee. In many instances we have been able to resolve such claims favourably for the guarantor.

In a recent case, our client settled the proceedings brought against him as guarantor by paying less than 5% of the amount claimed against him. We thought that was a pretty good outcome. So did our client! And it was achieved without the stress and expense of lengthy court proceedings.