Legal Terminology

Term Definition
Accrued Liability An expense or obligation that has been incurred but not yet paid or recorded, typically recognised in financial statements to reflect an entity’s financial position accurately.
Ademption The situation where a specific gift in a will cannot be given because the item is no longer in the estate at the time of the testator’s death.
Adoption A legal process through which an individual assumes the parenting of a child from the child’s biological or legal parents, permanently transferring all rights and responsibilities.
Affirmation A solemn declaration made by a person who conscientiously objects to taking an oath, serving as a legal promise to tell the truth in court proceedings or in documents.
Agency A legal relationship in which one party, the agent, is authorised to act on behalf of another party, the principal, in conducting business or other transactions.
Antenuptial Agreement Also known as a prenuptial agreement, this is a contract entered into by a couple before marriage, outlining the division of assets and financial responsibilities in the event of divorce or separation.
Arrears Money that is owed and should have been paid earlier, often related to rent, mortgage payments, or child support.
Articles of Association A document that specifies the regulations for a company’s operations and defines its purpose, detailing the rights and responsibilities of its directors and shareholders.
Bailment The process of placing personal property in the temporary custody or control of another, typically under a contract that requires the bailee to return or dispose of the property according to the bailor’s instructions.
Bankruptcy A legal proceeding involving a person or business that is unable to repay outstanding debts, resulting in the liquidation of assets to repay creditors or a reorganisation plan to allow the debtor to use future earnings to pay off creditors.
Best Interests of the Child A legal standard used by courts to make decisions regarding children in family law matters, prioritising the child’s safety, well-being, and development.
Binding Financial Agreement An agreement between parties, typically in a relationship, that sets out how their assets and financial resources will be divided in the event of separation or divorce.
Caveat A notice lodged with a court or land registry to prevent certain actions from being taken without notifying the party who lodged the caveat.
Chattel A moveable item of personal property, as opposed to real property (land and buildings).
Cohabitation Agreement A legal agreement between two people who live together in a domestic partnership, outlining their financial and property arrangements during and after the relationship.
Consent Orders Court orders made by agreement between parties to a family law dispute, covering matters such as property settlement or parenting arrangements.
Cross-Claim A claim brought by one defendant against another in the same proceeding, often seeking relief related to the original claim.
Covenant A formal agreement or promise in a contract or deed, particularly one concerning the use or development of land.
Conveyancing The legal process of transferring property ownership from one party to another, involving the preparation of documents, investigation of title, and ensuring compliance with legal requirements.
Collateral An asset that a borrower offers as security for a loan, which can be seized by the lender if the borrower fails to repay the loan.
Deed of Trust A legal document that establishes a trust, transferring property to a trustee to manage for the benefit of beneficiaries.
De Facto Relationship A relationship between two people who live together as a couple on a genuine domestic basis, without being married.
Derivative Action A lawsuit brought by a shareholder on behalf of a corporation against a third party, typically where the corporation’s management has failed to take action.
Discharge The release or termination of an obligation, debt, or liability, often used in the context of bankruptcy or contract law.
Domicile The country or state that a person treats as their permanent home or has a substantial connection with, affecting jurisdiction and legal rights.
Easement A legal right to use another person’s land for a specific purpose, such as a right of way or utility access.
Emancipation The legal process by which a minor becomes independent from their parents or guardians, acquiring adult rights and responsibilities.
Encumbrance A claim, lien, charge, or liability attached to and binding real property, affecting its transferability or use.
Equitable Distribution A legal principle used in divorce proceedings to divide marital property fairly, though not necessarily equally.
Estoppel A legal doctrine preventing a party from denying or asserting something contrary to what has previously been established as fact or agreed upon.
Family Law A legal practice area that focuses on issues related to family relationships, such as marriage, divorce, child custody, adoption, and domestic violence.
Force Majeure A contractual clause that frees parties from liability or obligation when an extraordinary event or circumstance beyond their control prevents one or both parties from fulfilling their contractual obligations.
Fraudulent Conveyance The illegal transfer of property to avoid creditors or obligations, often involving deceitful or dishonest actions to protect assets from legal claims.
Garnishment A legal process allowing creditors to collect a debt by seizing a debtor’s wages, bank accounts, or other assets held by third parties.
Guarantee A legal commitment by a third party to assume responsibility for another party’s debt or obligation if the original party fails to meet their obligations.
Holographic Will A will that is entirely handwritten and signed by the testator, often without witnesses or formalities required for standard wills.
Indemnity A contractual agreement to compensate for loss or damage incurred by another party, often used to allocate risk and liability in commercial transactions.
Injunction A court order requiring a party to do or refrain from doing specific acts, often used to prevent harm or protect rights in legal disputes.
Insolvency The financial state of being unable to pay debts as they fall due, leading to legal proceedings such as bankruptcy or administration to resolve financial distress.
Intellectual Property A category of property that includes intangible creations of the human intellect, such as inventions, literary and artistic works, designs, symbols, names, and images.
Interlocutory A provisional or interim court order or decision made during the course of legal proceedings, not determining the final outcome but addressing immediate issues.
Irrevocable Trust A type of trust that cannot be altered, modified, or terminated without the consent of the beneficiary or a court order, providing certain tax and legal benefits.
Joint and Several Liability A legal doctrine holding each party responsible for the entire obligation or debt, allowing the injured party to seek full compensation from any or all liable parties.
Laches A legal doctrine barring claims where there has been an unreasonable delay in pursuing them, causing prejudice to the defendant.
Leasehold A property interest granted by a lease, giving the lessee the right to use and occupy real property for a specified period in exchange for rent.
Letters of Administration A legal document issued by a court appointing an administrator to manage and distribute the estate of a deceased person who died intestate (without a will).
Lien A legal right or interest in a debtor’s property, granted to a creditor as security for a debt or obligation, allowing the creditor to seize or sell the property if the debt is not paid.
Limited Partnership A partnership consisting of one or more general partners, who manage the business and assume unlimited liability, and one or more limited partners, who invest capital but have limited liability and no management role.
Liquidated Damages A predetermined amount of compensation agreed upon in a contract to be paid in the event of a breach, providing certainty and avoiding litigation over damages.
Liquidation The process of winding up a company’s affairs, selling assets, paying off liabilities, and distributing any remaining assets to shareholders.
Litigation The process of taking legal action to resolve disputes or enforce rights, involving court proceedings and adherence to procedural rules.
Maintenance Financial support paid by one party to another, often in the context of divorce or separation, to ensure the recipient’s financial needs are met.
Mandamus A court order directing a public official or government body to perform a specific act required by law, often used to compel action or correct an abuse of discretion.
Mediation A form of alternative dispute resolution where an independent third party facilitates negotiation and communication between disputing parties to reach a mutually acceptable agreement.
Minority Shareholder A shareholder who owns less than 50% of a company’s shares, often having limited control over company decisions and subject to the majority’s influence.
Misrepresentation A false statement of fact made by one party to another, inducing the latter to enter into a contract or transaction, which can lead to rescission or damages if relied upon.
Mitigation The obligation of a party suffering loss or damage to take reasonable steps to minimise or reduce the impact, often relevant in contract and tort law.
Moratorium A temporary suspension of legal proceedings or enforcement actions, often granted to provide relief during financial distress or pending the resolution of a legal issue.
Negotiation A process of communication and bargaining between parties to reach a voluntary agreement or settlement, often involving compromise and collaboration.
Novation The replacement of an existing contract with a new one, transferring rights and obligations to different parties with the consent of all involved.
Option Contract A contract granting a party the right, but not the obligation, to buy or sell an asset at a specified price within a certain period, often used in real estate and financial markets.
Parol Evidence Rule A legal principle preventing parties from presenting extrinsic evidence to alter or contradict the terms of a written contract, ensuring the integrity and reliability of contractual documents.
Parenting Orders A set of legal directives issued by the Family Court or Federal Circuit Court that determine the parenting arrangements for a child.
Partnership A legal arrangement in which two or more individuals or entities agree to share ownership, profits, and responsibilities in a business venture.
Patent An exclusive right granted by the government to an inventor, allowing them to prevent others from making, using, or selling their invention for a specified period.
Power of Attorney A legal document authorising one person (the attorney-in-fact) to act on behalf of another (the principal) in legal, financial, or personal matters.
Restrictive Covenant A clause in a contract or deed that limits or prohibits certain actions or uses of property, often used to protect business interests or maintain property values.
Testamentary Trust A trust established by a will that takes effect upon the testator’s death, providing for the management and distribution of assets according to the testator’s wishes.
Trust A legal arrangement in which a person (the trustee) holds and manages property or assets for the benefit of another person (the beneficiary).
Undue Influence Improper pressure or influence exerted on a person to coerce them into making a decision or agreement against their free will.
Unilateral Contract A contract in which one party makes a promise in exchange for the performance of a specific act by another party, creating an obligation only when the act is completed.
Vesting The process by which an individual acquires a non-forfeitable right to benefits, such as pension plans, stock options, or trust interests.
Voluntary Administration A legal process in which an insolvent company appoints an administrator to assess its financial situation and propose a plan to repay creditors or restructure the business.
Warranty A contractual promise or assurance that certain facts or conditions are true or will be fulfilled, often providing a basis for legal action if breached.
Will A legal document expressing an individual’s wishes regarding the distribution of their property and assets after death, as well as the appointment of guardians for minor children or other personal matters.
Witness An individual who provides testimony or evidence in a legal proceeding, often based on personal knowledge or observation of relevant facts or events.
Zoning The regulation and classification of land use by local authorities to control and direct the development and use of property within a jurisdiction.

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