Why are legal opinion letters so valuable? In a business context, they serve as a form of risk management. For example, a lender might require a legal opinion letter from the borrower’s counsel to confirm that the borrower is a legally existing entity and that the loan agreement is enforceable. This provides the lender with confidence that their investment is secure.
Similarly, in a real estate transaction, a North Carolina limited liability company which is a would-be buyer might ask for a legal opinion on the title to ensure there are no outstanding liens or other claims. Beyond transactions, these letters can be useful in litigation to assess the strengths and weaknesses of a case, or to a corporation to ensure compliance with a particular regulation.
There are other situations in which a South Carolina corporation, for example, wants internal confirmation that a certain activity is legally allowable, and thus obtains a legal opinion letter on the topic at hand. Another example would be a Tennessee LLC seeking to provide its business partners with a legal opinion letter in order to facilitate mutual business activities and opportunities.
By providing a clear, unbiased assessment of a legal situation, a legal opinion letter can help parties make informed decisions, avoid costly disputes, and ultimately, close deals with greater certainty.
Please contact our law firm, McGrath and Spielberger, if you’re interested in a legal opinion letter.
This is part two of a blog article series by McGrath and Spielberger on Legal Opinion Letters. Click here to go to “Part 1: What Is A Legal Opinion Letter?“. Next week, we will share “Part 3: Key Components Of A Legal Opinion Letter”.