How well do you know the company or the people that you are contracting with?
Written by Sonja Daly, Partner, Commercial Litigation
In the media at the moment you are bombarded with the words 'economy in transition' and 'companies going into liquidation.'
How can you ensure that the company or person you are about to enter in to business with is not about to go under or bankrupt, leaving you out of pocket?
Many people rely upon personal recommendation, the 'word on the street', or 'the word in the marketplace' to decide whether a person in business or a company is good to deal with. Word of mouth can be good, however it is not enough. Do you know the financial position of the person or company?
I have dealt with a number of clients over the years who have relied on a recommendation, entered into a contract and then found out that the person or company that they are dealing with is in financial difficulty. This creates a number of problems with administering a contract and enforcing your rights under a contract. A few simple and inexpensive searches undertaken now may avert any nasty shocks later about the financial security of the company. We can conduct these searches for you, or guide you through the simple steps.
When entering into a contract with a company, we tell our clients to firstly ensure that the company actually exists. An on-line ASIC search can provide you with this important information. There are other simple searches which give a complete overview of the company, providing you with peace of mind and arming you with knowledge before doing business with the company
For further information, please contact the Commercial Litigation Team.
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