About to Sign Something Big? Do This $49 Due-Diligence Check First (Before You Lose Real Money)

You’ve got the document in front of you. A franchise agreement. A business-sale contract. A “strategic partnership”. A supplier deal bigger than anything you’ve signed before. And somewhere in your gut, a small voice is saying: read it again.

Listen to that voice. The people who lose real money on dodgy deals in Australia are rarely stupid. They’re busy, excited, and being hurried by someone who benefits from them not looking too closely.

• The franchise with the marketing-fund clawback. A Brisbane café franchisee paid $180,000 in. Clause 14.3 let the franchisor “recover marketing fund shortfalls” at its discretion. Two years in, an $11,000 invoice arrived for a national campaign nobody in Queensland saw.
• The “partner” who owned the IP. A Melbourne developer built the whole product for a 40% stake. The shareholders agreement assigned all IP to a company controlled by the other founder. When they fell out, he walked away with a laptop.
• The lease with the demolition clause. A Perth physio spent $95,000 on a fit-out. Eighteen months later the landlord triggered a demolition clause on six months’ notice. No compensation. It was on page 31.
• The coaching program with the 36-month direct debit. $1,497 a month, “cancel anytime” said the salesman. The agreement said “minimum term 36 months, no early termination”. That’s $53,892 for a Facebook group and a fortnightly Zoom.

Nothing was hidden. Every problem was in the document. They just didn’t know what to look for, and they didn’t ask.

The 12 questions to ask before you sign anything

1. Who exactly am I contracting with? The name on the letterhead is often not the entity on the contract. Get the ABN or ACN and check it matches.
2. What am I promising, and for how long? Term, renewal mechanics, minimum commitment. “Rolling” or “auto-renew” is a commitment until you prove otherwise.
3. What’s the total cost over the life of the deal? Not the headline price. Fees, levies, percentages, mandatory purchases, indexation, exit costs. Write the number down.
4. How do I get out, and what does it cost me? If you can’t answer in one sentence, you don’t understand the deal.
5. How do they get out? If they can terminate on 30 days’ notice and you’re locked in for three years, that’s the deal.
6. What happens to money I’ve paid if this falls over? Deposits, upfront fees, fit-out, stock. Refundable? Held in trust? Gone?
7. Who owns what I create or bring? IP, client lists, brand, data, goodwill. If the answer is “them”, you’re an employee without the protections.
8. Am I personally on the hook? Guarantees, indemnities, “director’s undertakings”. Your house can secure a company debt without the word “house” appearing anywhere.
9. What can they change without my consent? Prices, territory, product range, the terms themselves. Unilateral variation clauses are where a deal’s value quietly leaks out.
10. What have they promised verbally that isn’t in here? Projections, exclusivity, support. If it matters, it goes in writing or it doesn’t exist.
11. What happens when we disagree? Which state’s law, which forum, mediation first, who pays. A clause sending you to arbitration in Singapore means “you’ll never sue us”.
12. Why is this deal available to me? Good deals get taken by people with lawyers. If it’s being sold hard, ask what the seller knows that you don’t.

Red flags that should stop you cold

• Pressure to sign now. “Price goes up Friday”, “another buyer is interested”. Real opportunities survive a week of checking.
• A document that doesn’t match what you were sent. Compare page counts and clause numbers. Late changes are rarely in your favour.
• Personal guarantees for a company deal. Especially “all monies” guarantees covering future debts you haven’t agreed to yet.
• Restraints that outlast the deal. Two-year, Australia-wide non-competes are common in franchise and business-sale documents. Some are unenforceable; all are expensive to fight.
• One-way indemnities. You cover their losses, they don’t cover yours.
• “At our sole discretion.” Every time it appears, a right you thought you had is a favour they can withdraw.
• Vague deliverables with precise payment terms. They know exactly when you pay. You don’t know exactly what you get.
• A two-month-old Pty Ltd with $1 of paid-up capital and a director you can’t find online.
• Financials that only exist as a spreadsheet. No BAS, no bank statements, no accountant-prepared reports. Disqualifying for a business purchase.
• Anyone who discourages you from getting it checked. “It’s our standard agreement, everyone signs it.” That’s precisely why you should read it.

What you can actually negotiate (and what to ask for instead)

Almost everything is negotiable before you sign, and almost nothing is after.

• Term too long? Ask for a shorter initial term with an option to renew. Fallback: a break clause at the halfway point.
• Personal guarantee? Ask for it removed. Fallback: cap it at a dollar amount, limit it in time, or have it fall away once you’ve paid a set sum.
• Unilateral price increases? Ask for a CPI cap. Fallback: a right to terminate without penalty if any increase exceeds a stated percentage.
• Wide restraint of trade? Cut the geography to where you actually operate and the time to 6–12 months. Fallback: a cascading clause a court can read down rather than throw out.
• One-way indemnity? Make it mutual. Fallback: carve out losses caused by their negligence or breach.
• Deposit at risk? Ask for it held in a solicitor’s trust account until conditions are met. Fallback: a refund trigger if they don’t deliver by a fixed date.
• Verbal promises? Get them into a schedule or side letter that expressly forms part of the agreement. Anything else is decoration.
• Demolition, relocation or “sole discretion” clauses? Ask for compensation on exercise, or a minimum period before they can be triggered.

Someone who refuses to cap a guarantee or explain a fee is telling you how the next five years will go.

Verify before you trust: the free checks

Ten minutes on these registers has killed more dodgy deals than any lawyer.

• ABN Lookup (abr.business.gov.au). Confirm the ABN is active, the entity type, and how long it has been registered. A “ten-year-old business” with a 2024 ABN has a story to explain.
• ASIC Connect. Search the company and ACN: directors, external administration, and a current extract for about $10 if serious money is involved. Search the director’s name too, including the banned and disqualified register.
• PPSR (ppsr.gov.au). For any business, equipment or vehicle purchase, a $2 search shows whether someone else holds a security interest over what you’re buying.
• Licence registers. Builders, electricians, agents, financial advisers, motor dealers and labour hire providers must be licensed. Check the relevant state or ASIC register.
• Fair Trading and ACCC. Search both for the company and directors. For franchises, check the Franchise Disclosure Register and get the disclosure document (you’re entitled to it 14 days before signing).
• Google and court records. Search the company and directors in quotes plus “scam”, “complaint”, “liquidation”. Then check federal and state court lists for their names.
• Insurance and references. Ask for a certificate of currency and call two references who aren’t on their list.

Why a $49 review comes first

A full legal due diligence is a bigger exercise, and it has its place at the right moment.

The problem is the step before that. Someone weighing three franchises, two supplier contracts and a partnership offer won’t pay a lawyer to review all six. So they read none properly and pick on gut feel. That’s when the clawback and the demolition clause slip through.

The Claim Done Deal & Document Due Diligence Review fills that gap. Upload the document, answer a few quick questions (what the deal is, which side you’re on, how much money is on the line, anything already bothering you), pay $49, and within minutes you have a plain-English A4 PDF report: what the document actually commits you to, the red flags and one-sided clauses, the questions to ask the other party, the independent checks to run, the terms worth negotiating with fallback positions, and the “walk away if…” deal-breakers.

Use it to decide whether the deal deserves a lawyer at all, to walk into that lawyer’s office already knowing which clauses matter, or to walk away from the one that was never going to work, before the deposit leaves your account.

Stop guessing. Start checking.

Upload the contract, quote, franchise offer, lease, partnership deal or investment pitch and Claim Done delivers a plain-English Deal & Document Due Diligence Report: what it actually commits you to, the red flags and one-sided clauses, the questions to ask before you sign, what to verify independently, what to negotiate (with fallback positions), and the “walk away if…” deal-breakers.

Check This Deal Before I Sign — $49 →

You approve it before anything is sent. Upload the document, answer a few questions, report in minutes.