What is disclosure?
Disclosure is a process of providing information to the buyer: and in particular it allows the seller to detail aspects where the warranties cannot be complied with.
Take, for example, the situation where the seller provides a warranty that there is no litigation present or pending against the business. If the seller knows that this statement is not true, it can disclose against the warranty in a document known as the disclosure letter.
The seller discloses as much information as possible and provides copy documentation where relevant.
In the situation where the seller has received a letter from a customer complaining about the services he received, the seller would disclose a copy of the letter and all documents which relate to that complaint; it would also provide a concise summary detailing the circumstances of the complaint. This then prevents the buyer from saying after completion that he was unaware of the complaint by the customer. Any disclosure provided to the buyer has to be fair and the buyer will usually scrutinise and amend the disclosure letter very carefully.
Our commercial solicitors have a vast amount of experience and knowledge in preparing disclosure letters and advising clients on the aspects of disclosure.