Navigating the realm of business law can be a daunting task for anyone. There are often numerous state, federal, and administrative issues competing for your attention at any given time.
At Ourednik Law Offices, we are prepared to work by your side to ensure that all of your business law needs are met. Ourednik Law Offices can assist you in the areas that directly effect your business such as business formation, business succession, business litigation, and deferred compensation or the areas that affect your business and your personal life such as estate planning and asset protection.
Whatever the issue, we aim to be your first resource for all your business law needs. Contact Ourednik Law Offices today.
What is Business Law?
Business law is a very broad concept that can reach across many areas of legal practice, such as: agency; transportation; admiralty; insurance; contracts; employment and hiring practices; occupational safety; corporations, partnerships, and other business entities; federal, state, and local taxation; and the manufacture and sale of consumer goods. Given the vast array of legal concepts that encompass the term “business law,” it is understandably rare to find a single firm that concentrates their practice in all areas. It is more likely that a firm will be familiar with the most common aspects of business law, thereby serving the majority of their client’s business needs. At Ourednik Law Offices, we pride ourselves on our extensive knowledge of many of the most utilized areas of business law, some of which include:
Contract formation: Contract law is often referred to as “private law” because contracts are used to govern relationships between private individuals, groups, or entities. In contract formation, private parties have the ability to come together and set the “laws” (i.e. the terms of the agreement) that will govern the arrangement. Once a contract is formed, the terms of the agreement have legal consequences which are enforceable in a court of law.
Contracts are everywhere. All of us have been a party to one in our lifetime, and not all contracts require the assistance of an attorney. Some contracts, commonly known as “adhesion contracts,” do not provide an opportunity for the parties to negotiate the terms. These contracts are “take it or leave it” in the sense that if the party does not sign, them then they do not receive goods or services. Cell phones, cable television services, and computer software products all come with these types of agreements.
In other contracts, the parties have the free power to negotiate over the terms. Leases, purchase and sale agreements, marital property agreements (e.g. prenuptial or postnuptial agreements), legal settlements, and service agreements are just a few common examples of freely negotiable contracts that should be overseen by a legal professional. It is not uncommon for both parties to an agreement to have their own attorneys, especially in “arms length” transactions, or those transactions that involve two or more parties who are under no influence to seek anything other than the best possible deal for themselves.
Business entity formation, governance, and succession: There are numerous business law issues that surround the formation, governance and succession of a company. Initially, it is important to select the right kind of entity for the circumstances. For example, a large corporate model is often ineffective in meeting the organizational or taxation needs of most small businesses. Partnership or limited liability company entity structures are usually better suited for small businesses.
Once the entity is formed, the owners should have documents that govern how they will interact among themselves. These documents are most commonly referred to as bylaws, operating agreements, or partnership agreements, depending on the type of entity. Other governance documents may be necessary as circumstances change. Whatever the need, the goal of a well-drafted governance plan is to avoid future complications by planning for as many contingencies as possible.
It is generally a good idea that a portion of the initial business governance plan should focus on the eventual succession of the owners. Death, divorce, or sale of an owner’s interest can cause problems for both the business and the other owners as the business may not be prepared to absorb the loss of an owner and the other owners may face the unwelcome prospect of a new party exercising rights in the business without their consent. Beyond the initial planning, as the possibility of one owner leaving the business begins to become more probable, all owners should continue to modify and enhance their business succession plan with the assistance of a knowledgeable business attorney paying special attention to potential tax consequences.
Tax matters: Once an entity is formed, there are tax considerations at the local, state and federal levels. In Florida, business owners must consider: sales and use tax, unemployment tax, corporate income tax, and other state taxes. At the federal level, business owners must consider: income tax, self-employment tax, and payroll tax. Not all firms are prepared to handle tax matters for their clients. However, at Ourednik Law Offices all of our attorneys hold a masters degree in tax law (an LL.M.) and are prepared to advise our clients on tax issues as part of our business law services.
It is common that individuals start businesses without being fully aware of all the tax issues that must be considered. This can lead to problems in the future, as the uninformed business owner is not aware of their obligations until they have missed key deadlines for reporting or paying their taxes. Business tax liability can also mean personal liability for the owner, which is why it is so important to speak with a knowledgeable tax lawyer before starting the business.
Compensation arrangements: Compensation arrangements are another area of the law that affect many businesses. For example, many people are familiar with the concept of Florida’s protection for the wages earned by the head of the household. An individual who financially supports a spouse, child, or parent may qualify for protection from garnishment by creditors under the Florida Statutes. However, this protection is not automatic and the right to head of household treatment must often be shown in court. Small business owners may have a particularly difficult time claiming head of household protection when there is little in the way of documentation to support their claim. In these situations, it is important to distinguish between the individuals role as an owner of the company and their role as an employee. Failure to do so may leave the business owner without the benefit of this valuable statutory asset protection.
Another common example is deferred compensation arrangements. Deferred compensation arrangements are those in which a portion of an employee’s income is paid out at a date sometime after that income is actually earned. Examples of deferred compensation include pensions, retirement plans, and stock options. Deferred compensation arrangements provide many benefits to business owners. They may serve as a valuable incentive to convince talented potential employees to join the business. They also can provide tax benefits in the form of an immediate deduction for the company, while the employee may defer the payment of income tax until the date they actually receive the income. From a legal perspective, deferred compensation arrangements can be very complicated, and many business law practitioners are not comfortable discussing these issues. However, at Ourednik Law Offices, our attorneys are frequently advise business owners on establishing and maintaining their deferred compensation arrangements.
At Ourednik Law Offices, our attorneys are knowledgeable in these areas of business law and many more. We always welcome the opportunity to serve your business needs. Please contact our office if you feel we can be of assistance to you or your business.