A director asked to guarantee company borrowing needs advice on the individual commitment, which can differ from advice given to the company. Fee comparison should establish who the solicitor represents and which documents are reviewed.
The decision that deserves the closest review
Supply the guarantee, facility agreement and relevant security documents. Ask about caps, continuing obligations, variation and release. Clarify whether the fee includes negotiations or only advice on the proposed document.
A hypothetical example
A director receives a short guarantee alongside a larger facility pack. It gives both to its adviser because the individual commitment may depend on definitions and changes in the connected agreement.
Define the legal instruction
Clarify whether the firm advises the company or the individual. Independent representation and review of connected documents can be central to the instruction.
Professional fees, scope and other expenses
Ask for written scope and a clear fee basis: fixed, hourly, staged or another agreed arrangement. Identify applicable taxes, third-party expenses and excluded specialist work. Clarify what happens if facts change or the instruction expands, and who must authorise additional work before it begins.
| Comparison item | Question to resolve |
|---|---|
| Documents and connected facilities | Who is the solicitor’s client? |
| Scope of advice and negotiation | Are connected facility terms reviewed? |
| Caps, duration and release arrangements | Does the quote include negotiating changes? |
Compare the deliverable and excluded stages line by line. Keep a record of the agreed estimate, revision process and approval for any additional expenses.
Prepare a brief the solicitor can price
Supply the complete documents, a short chronology where useful, the commercial objective and any urgent dates. Explain what outcome you need from the instruction. Clear organisation allows the adviser to distinguish initial scoping from a substantive review and later negotiation or dispute work.
Make the individual’s instruction distinct from the company’s
Supply the complete guarantee and the connected facility documents, identifying the person expected to sign. Ask the firm whom it will represent and whether additional arrangements are needed for independent advice. The quotation should address the actual proposed commitment rather than a generic discussion of director obligations.
Compare document review, explanation, amendment requests and any lender-required confirmation separately. Ask how further drafts or negotiations would be charged. Keep the final version and any release correspondence organised so a later change to the business can be assessed against the commitment actually signed.
This legal guide concerns England and Wales. Confirm the jurisdiction and scope for the actual instruction.
A mistake to avoid
Assuming company representation automatically includes independent advice for the guarantor.
Agree how the instruction will be managed
Agree the contact person, expected updates and who can approve further work. Ask how the budget changes if the other side sends new documents, negotiations expand or proceedings become necessary. Keep advice, agreed terms and the executed documents organised so operational decisions use the final position rather than an earlier draft.
Questions before choosing
Can the director rely on an oral description of the guarantee?
Ask the solicitor to explain the written terms and identify where the summary differs from the actual commitment.
Is advice to the company automatically advice to its director personally?
Clarify representation and the instruction. A company and an individual guarantor can have different interests and responsibilities in the same transaction.
Sources and further reading
Research date: 6 October 2026. Refer to the current linked guidance and written provider or adviser terms when making a decision.