Legal Definitions - independent advice

Independent advice refers to guidance or counsel provided by someone who is neutral, unbiased, and whose recommendations are not influenced by any personal gain or interest they might have in the outcome. The core principle is that the advisor's sole motivation is to serve the best interests of the person receiving the advice, without any hidden agendas or conflicts of interest.

Here are some examples illustrating independent advice:

• Imagine a person considering a significant investment in a new company. They consult with a financial advisor who charges a fixed fee for their services, rather than earning commissions on the specific investment products they recommend. This advisor's counsel is considered independent advice because their income does not depend on which investments the client chooses. Their recommendations are therefore focused purely on the client's financial goals and risk tolerance, rather than on promoting products that would benefit the advisor financially.

• Consider an elderly individual who wishes to make a substantial gift of property to a new acquaintance. To ensure the gift is genuinely voluntary and not the result of undue influence, their primary attorney might recommend they seek independent advice from a separate, unconnected legal professional. This second attorney would review the proposed gift, confirm the individual's intentions, and ensure they fully understand the implications, thereby verifying that the decision is made freely and without pressure from the recipient or the primary attorney.

• A small business owner is negotiating a complex contract with a larger corporation. Before signing, they seek legal counsel from an attorney who has no prior relationship with the corporation, no financial stake in the deal, and no other clients who would benefit from the contract's terms. This attorney provides independent advice by objectively analyzing the contract's clauses, identifying potential risks, and suggesting amendments that solely protect the small business owner's interests, free from any external pressures or conflicts of interest.