If all the circumstances are such that a person-to-person interview is not possible, then the use of videoconferencing is a possibility if you have been requested to provide an independent solicitor’s certificate for a third-party guarantor, surety mortgagor, or indemnifier for a principal borrower.
As a matter of caution, you should ensure that you are able to undertake this interview in circumstances where the third-party guarantor, surety mortgagor, or indemnifier are in the absence of the principal borrower.
You must take reasonable steps to ensure the persons who are receiving the independent advice are not the subject of undue influence and you should ensure your file note records the steps you have taken.
You must carefully read the independent solicitor’s certificate available from qls.com.au to ensure that you can comply with the explanations and advices you are to give as the certifying solicitor.
A videoconference will not exclude you from undertaking verification of the identity of the third-party guarantor, surety mortgagor, or indemnifier. You will need to modify your retainer agreement and the certificate to reflect the circumstances under which the interview is taking place.
The new (Justice Legislation (COVID-19 Emergency Response—Documents and Oaths) Regulation 2020) now permits the remote witnessing of deeds. The acknowledgment which is to be given by the third-party guarantor, surety mortgagor, or indemnifier should be modified to reflect the circumstances of the interview. Practitioners should, however, remember that it is not possible to certify documents remotely. The certification with respect to the guarantor’s certificate should also be modified to reflect the fact that the certificate will not be able to be handed to the third-party guarantor, surety mortgagor, or indemnifier.
Solicitors should also read carefully the checklist on our website for the providing of independent legal advice. For those solicitors who are Lexon insured, you should also review the Lexon material.
Solicitors should be mindful of the risks involved by the use of videoconferencing and it would be prudent to confine the provision of a certificate in all circumstances to existing clients. A comprehensive file note and preferably the recording of the interview (with the client’s consent) should take place. If you have any doubts as to the suitability of videoconferencing then you should not undertake this as a means of interviewing the third-party guarantor, surety mortgagor, or indemnifier.
You should also insist that the third-party guarantor, surety mortgagor, or indemnifier read the document fully prior to the interview. It is not sufficient for you to confirm merely that the third-party guarantor, surety mortgagor, or indemnifier has read through the document.
Open questioning and enquiry as to the third-party guarantor, surety mortgagor, or indemnifier’s understanding of the true position will be required. Solicitors are reminded that they must satisfy themselves that the third-party guarantor, surety mortgagor, or indemnifier has freely made the statements which are referred to in Part D of the certificate, and appear to have an understanding referred to in that part.
If it appears to you that the third-party guarantor, surety mortgagor, or indemnifier does not have an understanding, do not sign the certificate.
You will not be in a position to remotely witness the third-party guarantee documents. Personal presence is still required for such execution.
Stafford Shepherd is the Director of the Queensland Law Society Ethics and Practice Centre.
This story was originally published in Proctor June 2020.
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