Solicitors are sometimes asked by their clients to provide independent legal advice to satisfy the bank’s requirement that the client obtain independent legal advice when going guarantor providing security for a borrower.
Rule 58 of the NSW Solicitors Rules 2013 sets out the conditions upon which a solicitor may give independent advice on loan and security documents.
A Statutory Declaration made by the borrower evidencing the independent advice must be in the form set out in Schedules 1, 1A or 1B.
A Statutory Declaration made by the guarantor evidencing the independent advice must be in the form set out in Schedules 2 or 2A. The Statutory Declaration is to be returned to the bank.
The borrower or guarantor who receives the advice must sign an acknowledgement in the form set out in Schedule 4, 4A, 4B or 4C. The acknowledgement must be kept by the solicitor and NOT returned to the bank.
A solicitor must not sign a certificate to the effect that they have provided independent advice.
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