Undue Influence + Third Parties

Question 1

When is this commonly appearing?

Answer 1

when spouse of business owner goes to bank and agrees to their share in the home to be used as security for the loan the business owner is borrowing from the bank.

Question 2

what reasonable steps must banks/creditors take in advising the innocent party + their sol?

Answer 2

1) advise them to take independent legal advice

2) Ensure they provide sol w sufficient info on trans so they can explain fully to party

3) If aware that wife may have been misled - must tell sol this

Question 3

The solicitor must…

Answer 3

a) explain docs + practical consequences incl risk of losing the home (eg security over house)

b) seriousness of the risk, duration + terms of security etc

c) the fact wife has a choice