Business Formation & Litigation
Business law deals with the creation and maintenance of businesses. A major focus of business law is preventing future legal problems. Whether you are an existing small business owner or are looking to start a new company, you need legal protection. Leigh Law has extensive experience in guiding small and medium sized business owners through the process of forming the right business for them and coordinating with accountants and bookkeepers. Keeping your business house in order should be your top priority.
Breach of Contract
Many people don’t really understand exactly what a contract is or what constitutes a breach. Almost everything we do in society is a contract – oral or written – an agreement for one person to do (or not do) something in exchange for another person to do (or not do) something else is a contract!
The tricky part is proving the terms of the contract if one side does not live up to his or her end of the bargain and calculating damages. Courts will examine the terms of the contract will be interpreted through the eyes of a reasonable person looking objectively at the words and actions of each party.
In Arkansas, people are not entitled to punitive damages for breach of contract, but you are entitled to actual damages (what the breach cost you out of pocket) and to recover your attorney’s fees if you win.
An attorney’s primary job is not to reduce to writing in fancy legal words, the terms of your agreement, but the much more difficult and infinitely more important job is to protect you if your deal goes south. Most people do not consider the what-ifs – what happens if the partnership breaks up or things go wrong. In the real world, something always goes wrong! I make sure you have adequate remedies, I make sure the other side does not have too many remedies, I make sure you are not penalized for things that are not your fault, and I make sure that your liability will be limited in the event you breach the contract.
You need an experienced attorney to advise you on the best way to protect your interests and what is likely to go wrong in the deal. Let Leigh Law Roar to your Rescue!
There are three main types of business entities that your business may be eligible for: corporation, limited liability company, or a partnership/sole proprietorship. When starting a new business, it is important to choose the right type of entity for your business. There are many things to take into consideration such as:
- Size of Company
- Cost of Maintaining Entity Status
- Regulatory Requirements
- Tort and Tax Liability
- Protection of Intellectual Property
A corporation is unique from other business types because it is a completely separate legal entity from its shareholders. This means the corporation has its own expressed rights and liabilities. The corporation consists of a board of directors and shareholders that manage the business. Due to the complexity and constant maintenance of this type of entity, a corporation is typically only ideal for medium to large-scale businesses. There are tax consequences and fairly extensive record keeping requirements to maintain your corporation protections.
Limited Liability Companies and Partnerships
LLCs are typically the best option for small to medium-sized businesses. In this type of entity, you are protected from legal actions against you and your partners. You also have the tax efficiencies and operational flexibility of a partnership/sole proprietorship. There are time and cost benefits to LLC over corporations too. The responsibilities and record keeping are not as intense and are geared toward small business owners. The operating Agreement is the most important part, particularly if you have more than one member or choose to be manager-managed.
Partnership / Sole Proprietorship
Partnerships or sole proprietorships can be used when there are one or two people running the entire business. These are by far the simplest business entities to manage. However, unlike LLCs, they leave you very vulnerable. All your assets are subject to the business liabilities and vice versa. Partnerships and sole proprietorships, while the easiest options, offer the least protection of any business entity. Call Leigh Law to discuss with one of our attorneys some other options, which are also simple and inexpensive to maintain but provide much more protection and peace of mind.
There are countless contracts involved in starting a new business. These contracts include everything from employee agreements to what should happen if a partner leaves the company. Leigh Law will Roar to your Rescue when problems do arise, but we still think the adage “…a good understanding makes for a lasting friendship…” is a better philosophy to follow when entering into a contract or business relationship. The question that many people fail to ask—is how will we separate if this business relationship does not last?
Invest in Your Future
Small Business owners need protection. Explore your business options with Leigh Law and find out which one is right for you and your business. Get the highest tax benefit you can and protect yourself from personal liability at the same time. Corporations, LLCs, and partnerships can all can be confusing, but protecting yourself and your partners now will save you from expensive and stressful situations in the future.
Partnerships, like marriages, many times end in break-ups. Planning now for how you and your partners will go your separate ways ensures an amicable split when and if that time comes.