Dealing with Money: Nuggets of sound advice
Toby Matthews is a Senior Associate in our Dispute Resolution Department and head of the Property Litigation team at , a full-service legal practice with offices Edgware, Mayfair and Harrow in London and Birmingham.
In this special column, the legal expert offers some insights in money management and the importance of written agreements.
“Lesson number one: Don’t underestimate the other guy’s greed.” – Frank Lopez, ‘Scarface’.
Movies may seem like flights of fantasy but every so often, they offer nuggets of sound advice. Whether you are dealing with family or business partners, business and money will always bring tensions and vulnerabilities. In all aspects of life and death, money is well known to be the catalyst of change and that can be for growth or it can irrevocably change a family. We have acted on partnership disputes between brothers, receivership matters between lender and borrower and contested probate matters between family members. There are ways to ensure you protect your position as best as possible.
A Written Agreement
“A 25% slice of something is better than 100% slice of nothing.” – Fast Eddie, ‘The Hustler’
Whether it is a loan for hundreds of thousands of pounds to a business or you are lending money to a family member, the importance of putting even the basic terms in an agreement cannot be underestimated. Ensuring that both parties know what is being agreed and what the potential ramifications of breaching that agreement are will safeguard your ability to resolve any dispute that may arise. For the avoidance of doubt, a Will is also a type of agreement that will give your executors clear instructions on how to distribute your estate. Unfortunately, you cannot prevent people from causing trouble in the future but by ensuring that your wishes are set out in writing will provide a clear basis for what you intended to happen.
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“Show me the money!” – Jerry Maguire, ‘Jerry Maguire’
Most people forget to keep records. Whether or not you have an agreement in place, ensure that you keep good records for the transfer of any sums whether sent or received. If you are a business, then the investment in a good set of accountants is invaluable. If it is a personal matter, then ensure that you keep bank records or a running statement of accountant. We often ask clients to provide details of the financial transactions involved in a matter and we receive responses such as: “we only dealt in cash” or “I am not sure we have those bank details anymore”. This may not be an issue but it may cause you to incur greater costs in having to regularise the position.
“We go to the mattresses.” – Santino Corleone, ‘The Godfather’.
If the relationship breaks down and it becomes necessary to take formal steps to recover money, having an agreement in place and cogent records will greatly assist in making a claim for the return of the funds and any other losses you may have suffered. A small of time and money at the outset will save you a great deal in the long run.
Never be afraid to ask your friend, partner or family member to record the terms of your arrangement. In general, people are terrible at talking about money and it will not come naturally to many. However, if there is nothing to hide then both parties should not be afraid to writing down the terms of the agreement or any changes to that agreement.
by Toby Matthews
Toby Matthews is Senior Associate at . He has been working in dispute resolution for approximately 14 years. His experience covers a wide variety of contentious matters and he is able to assist most departments within the firm with any matters that turn contentious.
*Info: For questions on this article or any further queries, please feel free to contact Toby: TM@axiomstone.co.uk