Best Due Diligence Lawyers in Georgia

About Due Diligence Law in Georgia, United States

Due diligence is the comprehensive process of investigating and evaluating a business, individual, or property before entering into a formal agreement or transaction. In Georgia, due diligence is especially important in real estate transactions, business acquisitions, mergers, and various financial undertakings. The purpose is to ensure that all material facts are known so informed decisions can be made and legal risks can be minimized. While there are general standards for due diligence, Georgia statutes and case law may create special considerations, especially regarding disclosure requirements and the types of searches necessary depending on context.

Why You May Need a Lawyer

There are many situations where legal assistance with due diligence becomes essential in Georgia:

• Buying or selling commercial or residential property
• Purchasing an existing business or franchise
• Entering a partnership or forming a new company
• Making investment decisions involving significant financial risk
• Conducting background checks on business partners, vendors, or key personnel
• Ensuring compliance with state and federal regulations in transactions
• Identifying or addressing potential liabilities, liens, or claims affecting property or business dealings
• Reviewing contracts that include representations and warranties

Local Laws Overview

Georgia due diligence practices are shaped by a combination of statutory requirements and judicial precedents. Some key aspects include:

• State-specific real estate disclosure laws require sellers to provide certain information to buyers, but the principle of "caveat emptor" (buyer beware) often applies, making buyer-initiated due diligence vital.
• Business acquisition due diligence in Georgia generally includes review of corporate records, debt obligations, pending litigation, tax returns, regulatory compliance, and employment matters.
• In residential real estate transactions, due diligence periods are customarily negotiated and specified in contracts, providing time to inspect property, verify title, and clarify zoning or land use questions.
• Georgia law does not mandate exhaustive searches but failing to investigate can leave parties exposed to unexpected liabilities.
• The Georgia Secretary of State's office maintains public business records, and property records are available at county clerk offices, which are useful for certain aspects of due diligence.

Frequently Asked Questions

What is due diligence in a legal context?

Due diligence is the process of thoroughly investigating a party, property, or transaction before completing a deal, to identify potential issues, liabilities, or risks.

How long does the due diligence period typically last in Georgia real estate?

The time period is negotiable but is often 7 to 21 days. The exact duration will be specified in the purchase and sale agreement.

What happens if an issue is found during due diligence?

The buyer can typically withdraw from the deal, renegotiate terms, or request remediation as permitted by the contract if material issues are discovered.

Is due diligence required by law in Georgia?

While due diligence is not always legally required, it is a standard business and legal practice to avoid future disputes or legal exposure.

What are common components of business due diligence in Georgia?

Reviews often include financial statements, incorporation documents, contracts, employment agreements, tax records, litigation history, and intellectual property.

Can I perform due diligence on my own?

Some searches can be done independently, but many legal and financial reviews benefit from the expertise of attorneys, accountants, or investigators who know Georgia law and local practices.

What is a due diligence contingency?

It is a clause in a contract allowing a buyer a set period to investigate and cancel the agreement without penalty if issues are found.

Who pays for due diligence costs in Georgia?

Usually, the buyer bears these costs, which can cover inspections, legal review, and administrative fees.

What legal risks are there if I skip due diligence?

You could inherit undisclosed debts, defects, or litigation, or face financial loss due to incorrect representations or missing regulatory compliance.

Can a lawyer negotiate the due diligence period on my behalf?

Yes, an attorney can negotiate deadlines, access to documents, and remediation measures to protect your interests.

Additional Resources

• Georgia Secretary of State - Division of Corporations (for business registrations and filings)
• Georgia Real Estate Commission and Appraisers Board (for real estate transaction guidelines)
• Local county clerk's offices (for property records and lien searches)
• Georgia State Bar Association (for attorney referral services)
• Georgia Department of Revenue (for tax matters relevant to due diligence)
• Small Business Development Center Georgia (for business transaction support)

Next Steps

If you are considering a property purchase, business deal, or other major financial transaction in Georgia, take these steps:

• Clearly define your goals and the scope of due diligence needed for your transaction
• Compile a list of preliminary questions or concerns about the deal
• Gather basic information and documents related to the subject of your due diligence
• Consult with a Georgia-licensed attorney experienced in the relevant area of law
• Work with your attorney to create a checklist and timeline tailored to your situation
• Follow through with searches, inspections, interviews, and reviews as needed
• Discuss findings with your lawyer and decide on appropriate negotiation or action, based on the results