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Abstract

A succession of cases has come before the courts in recent years involving women seeking to set aside secured guarantees given to support the debts of family businesses controlled by their husbands. The legal treatment of guarantees is dichotomous. Where a guarantee is provided for personal or domestic purposes recent consumer credit law reforms have ensured that financiers abide by a common set of rules when entering into the transaction. Guarantees to support business debts are still largely governed by common law principles and some statutes of general commercial applicability. There is a need for law reform to close the 'business guarantee gap' and provide uniformity of treatment for all guarantors. This article examines the treatment of business guarantees, noting the impact of some recent important decisions and law reform proposals.

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