Over the top clauses in guarantee agreement

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    Over the top clauses in guarantee agreement

    Hi
    I have been asked to sign a guarantee agreement- which in principle I am happy to do. I am fine with the terms of a typical agreement (I am also a landlord)

    However this agreement contains:

    If the Tenant shall default in the performance and observance of any of the provisions or terms on the Tenant’s part contained or implied in the Agreement I/We will on demand pay you all losses damages expenses and costs which you may be entitled to recover by reason of such default. The amount of my/our liability under this Clause is unlimited.
    This Guarantee shall continue in full force and effect despite any variation or alteration of the terms or provisions of the Agreement with or without my/our consent including any increase in the amount of the rent payable in respect of the Property by the Tenant and this Guarantee shall extend to any new or further agreement entered into between the Tenant and yourself under which a tenancy of the Property is granted to the Tenant irrespective of the amount of the rent or the monies payable in respect thereof or the terms and provisions thereof or the persons who are parties to the same.
    This Guarantee shall not be discharged nor shall it be released by any arrangement made between the Tenant (or any other person who is a party to the Agreement) and yourself with or without my/our consent or by any indulgence forbearance or time given to pay or otherwise comply with the terms and provisions of the Agreement or failure or neglect on your part to enforce the Agreement whether as to payment time performance or otherwise or any refusal by you to accept rent or other monies following any breach of the terms and provisions of the tenancy.

    Which (last bit) I read as "you can't argue that the problem was caused by lack of due diligence on our part"

    The conduct of this agent is worrying in other respects and were I to post details here I would probably be advised to walk away. Eg the guarantee is for an average condition small house in an OK area, and for people with seriously good jobs. However before I make it impossible for the people I am proposing to guarantee to get their tenancy I would be really grateful for any feedback

    Thanks and regards

    #2
    You don't need post about "other respects" for you to be advised to walk away. I'm happy to say that to you now.

    If you're not happy with the terms of a guarantee, don't agree to it. It's that simple.

    The first paragraph is reasonable. The second one, not so much... I have no idea what the 3rd one is trying to say.
    I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

    I do not answer questions through private messages which should be posted publicly on the forum.

    Comment


      #3
      That agreement has been written by someone trying to make things sound "legal".

      " If the Tenant shall default in the performance and observance of any of the provisions or terms on the Tenant’s part contained or implied in the Agreement I/We will on demand pay you all losses damages expenses and costs which you may be entitled to recover by reason of such default. The amount of my/our liability under this Clause is unlimited."
      Is gibberish.

      "Shall default" is (presumably) "defaults".
      "performance and observance of any of the provisions or terms" is (presumbly) "terms"
      "on the Tenant’s part contained or implied in the Agreement" is completely meaningless.

      Someone has read that "shall" means something more 'legal' than "will".
      When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
      Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

      Comment


        #4
        Grateful to you both.
        Regrettably many companies expect people to put themselves in the firing line for all sorts of potential legal horrors in the future and until they find that it regularly loses them and their clients business, as in this case, they will continue with impunity . Whatever it was that the author of this codswallop intended to achieve, it has proven to be a dealbreaker and I will be making this clear to them as soon as I can get to speak to someone - which is proving near impossible right now. Enough said. Thanks again.

        Comment

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