INDEPENDENT LEGAL ADVICE | Why your Explanation is Important

To schedule an appointment, contact our law firm at 403-400-4092 or Chris@NeufeldLegal.com

Although the request is being made for Independent Legal Advice (ILA), the certification that is being sought is in fact not about receiving independent legal advice, it is in fact most often about understanding the legal implications of signing the particular legal document. And even though a lawyer's explanation as to the content and legal implications of signing a particular legal document is part of what is being sought, that is only a part of what is required for purposes of the lawyer's certfication. The lawyer must in fact understand what is being sought of the legal document that they are being asked to sign, such that it is more than a simple listening exercise.

As such, to properly complete the certification that is required under the name Independent Legal Advice or ILA, the recipient must demonstrate to the lawyer that they understand what it is that they are in fact signing and the potential adverse implications that it exposes them to. This is what in most cases is being sought by way of an ILA, such that the preferred approach for undertaking the provision of Independent Legal Advice is for the recipient to first provide their understanding of the subject document and its legal obligations, with the lawyer proceeding to expound, correct and clarify aspects associated with the subject document and its legal obligations. It is for that reason that the recipient's explanation is so important, and it is a practice that is consistent with the directives put forth by many law societies with respect to how lawyers should proceed with undertaking the provision of independent legal advice.

 

hat is Independent Legal Advice? Independent Legal Advice (ILA) is the process of a person receiving unbiased and objective legal guidance from a lawyer who is not connected to or influenced by any other party in a transaction or dispute. The key elements that the lawyer should be looking to emphasize when explaining ILA include:

  • Independence and No Conflict of Interest:

    • The lawyer providing the ILA must represent only the individual seeking the advice.

    • The lawyer also must not be the lawyer for the other party (e.g., a spouse, a business partner, or a lender) and must have no personal or professional conflict of interest.

  • Informed Consent and Full Understanding:

    • The lawyer should thoroughly review the legal document (like a contract, agreement, or guarantee) with you, which might entail aclause by clause review of certain documents.

    • The lawyer should look to explain the document in plain language, ensuring you understand the nature, effect, consequences, and potential risks of signing it. If you are actually capable of explaining the document and its implications to the lawyer at the outset, so as to demonstrate your understanding and knowledge as to its consequences, this is actually the preferred approach of the law society.

    • The lawyer needs to ensure that you understand your legal rights in the matter and what you are giving up or gaining by signing. Again, if you are capable of explaining your understanding of the document, with the lawyer providing added direction and clarification, this is the preferred approach of the law society [why your explanation is important].

  • Voluntariness and Freedom from Coercion:

    • The lawyer confirms that you are entering into the agreement voluntarily, without any undue pressure, duress, or influence from the other party. This is especially important in situations with a power imbalance.

  • Assessing Fairness and Alternatives:

    • The lawyer will look to provide an objective opinion on whether the agreement is fair and reasonable in your specific circumstances, potentially comparing it to what might be decided in court.

    • The lawyer may also look to discuss any compromises made and may suggest changes or negotiations to protect your interests (although in many circumstances there is no true negotiation as to the legal language and obligations being assumed, such as with bank required personal guarantees and the completion of a Guarantees Acknowledgment Act Certificate).

  • Documentation (Certificate of ILA):

    • To create a record and enhance the enforceability of the agreement, the lawyer will often issue a Certificate of Independent Legal Advice. This is legal document confirms that you received the requisite legal advice and understood the principal document before signing it.

Important Note for Guarantors: For anyone considering becoming a guarantor, it's crucial to understand the significant financial responsibility and risks involved. They are legally obligated to fulfill the terms if the primary party defaults, and this can have serious consequences for their own finances and credit history. Consulting with legal and financial professionals is highly recommended.

Our law firm can provide you with independent legal advice (ILA) when you are required to receive same from an independent and impartial lawyer such that the legal documents that you are signing are enforceable against you. To schedule an appointment with our law firm, please call our law firm at 403-400-4092 or email Chris@NeufeldLegal.com today.

Independent Legal Advice (ILA)