A guarantor is the darling of the courts. Over the years, the case precedents to which courts adhere have favoured guarantors over lenders. The consequence is that there are many ways for guarantors to evade liability. Because we know what those precedents are, the bulk of a typical corporate guarantee is to remove that common law rights one-by-one.
The course carefully goes through each clause, explains the problem that we need to address, and identifies how the clause achieves its objective.
Additionally, guarantees have many ‘voodoo’ words and phrases – words that have special legal meanings. Altering those words or phrases could inadvertently alter the legal effect of the document. We take special care to identify them and the potential risks.