Director Guarantee Enforcement Checklist
A personal guarantee can let you pursue a director when their company does not pay — but only if the guarantee is valid, properly signed, and clearly covers the debt, so check the document carefully before relying on it.
What this checklist covers
- Confirm a valid personal guarantee exists and covers the debt
- Check the guarantee was properly given and signed
- Establish the company's default and the amount owed
- Make a clear demand under the guarantee
- Get advice before enforcing against an individual
6 min
Before you start
A director's guarantee shifts a company debt onto an individual who promised to pay if the company did not. Its value depends entirely on the document being valid and on it actually covering the debt in question. Before acting, find the signed guarantee, the company's account, and proof the company has defaulted.
- Locate the signed personal guarantee document.
- Confirm it covers this debt and this company.
- Check who signed it and that they had authority and understood it.
- Establish the company's default and the current amount owed.
This is general information only and not legal advice. Guarantees are technical, and enforcing against an individual carries its own considerations — get professional advice before proceeding.
Check the guarantee is sound
- Confirm the guarantee is signed by the director you intend to pursue.
- Check the wording covers the type and amount of debt now owed.
- Look for conditions, limits or expiry that affect enforceability.
- Consider whether the guarantor received the document and understood it.
- Verify the company has genuinely defaulted, triggering the guarantee.
A guarantee that is unsigned, limited, or does not cover this debt may give you nothing. Testing the document carefully before you rely on it avoids pursuing an individual on a guarantee that will not hold up.
Demand and enforce
- Make a clear written demand on the guarantor under the guarantee.
- State the company's default, the amount, and the basis of your claim.
- Give the guarantor an opportunity to pay or respond.
- Keep the demand and all correspondence on file.
- Take advice before escalating to formal recovery against the individual.
Enforcing against a person is more sensitive than chasing a company, so a clear, well-founded demand matters. Make sure your claim is solid and documented before you escalate, and get advice on the right way to proceed.
Common mistakes
- Relying on a guarantee that is unsigned or does not cover this debt.
- Overlooking limits, conditions or expiry in the wording.
- Pursuing the guarantor before the company has actually defaulted.
- Making a vague demand that does not set out the basis of the claim.
- Escalating against an individual without taking advice first.
If a company debt is backed by a guarantee, a free debt appraisal can help you weigh whether pursuing the director is worthwhile.
Key takeaways
- Confirm the guarantee is valid, signed, and covers this debt.
- Check for limits, conditions or expiry before relying on it.
- Establish the company's default and make a clear written demand.
- Get advice before enforcing against an individual.
Frequently asked questions
Can I pursue a director personally for a company debt?
Only if there is a valid personal guarantee that covers the debt, or another proper basis. The guarantee must be sound and the company in default. Get advice before pursuing an individual.
What makes a personal guarantee enforceable?
Generally it needs to be properly given and signed, cover the relevant debt, and be free of fatal limits or conditions. Have the document checked before relying on it.
Do I demand from the director before or after the company defaults?
A guarantee is typically triggered by the company's default. Establish that default and the amount owed first, then make a clear written demand under the guarantee.
Work the checklist, then get paid
Use the free Invoice Generator, then let Merion recover anything that goes unpaid — commission-only.