Thinking of setting up a business and not sure where to begin? Conferring with a business lawyer will most certainly make your process of setting up a business easier in the following ways:
Choosing a Business Structure:
One of the initial decisions of setting up a business is deciding whether you are setting it up as an individual, a partnership or a company. One may also be confused about which structure is appropriate in their circumstances. A business lawyer can not only suggest which business structure is appropriate in their client’s circumstances, but also go through the available choices of business structures and any liability issues associated with them. For example, if a person intends to carry a business alone, he/she may set up a business as a sole proprietorship or a company. Whereas, if a person intends to carry a business with 1 or more persons, then he/she may choose from a variety of business structures, namely general partnership, limited partnership, company and limited liability partnership.
Assisting with Incorporation:
Once a decision about an appropriate business structure is made, a business lawyer can then assist you with incorporating your business. Depending on your incorporating jurisdiction, there are many legal requirements to comply with, such as the number of directors that must reside in a given jurisdiction. A business lawyer will inform you of such legal requirements and ensure compliance.
You may also find it useful to discuss other topics with your lawyer, including the name requirements in your jurisdiction and whether you need to protect your name with a trademark. Other topics include understanding compliance with annual maintenance requirements and, if it is a corporation, duties of directors, partners and minority shareholders.
Advising on General and Specific Business Practices/Transactions:
Whether your business is small or large, you should seek assistance from a business lawyer on any matter relating to my business. The earlier the involvement of a lawyer however, the better it is as business lawyers can assist with due diligence, spotting legal issues before they arise and presenting possible solutions to those issues.
Acquiring or Selling a Business or its Assets:
Business lawyers play a critical role in assisting you with acquiring or selling shares of a corporation or a partnership or acquiring or selling assets of a business. The two ways to achieve such a sale or purchase is through a share purchase or an asset purchase agreement. Whether you are the buyer or the seller, a lawyer can assist with conducting due diligence in the transaction, negotiating on your behalf, and carefully draft the agreements to ensure they are reflective of your expectations.
Resolving Disputes:
A dispute can arise in the lifetime of a business among different individuals involved in that business or between other businesses that it deals with. A role of a lawyer in resolving a business dispute is strategic in that he/she will consider every option that is available to resolve that dispute efficiently including, litigation if necessary.
Drafting Contracts:
Business lawyers are equipped at reviewing and drafting contracts and agreements to ensure they accurately reflect the intentions of the parties. Such agreements include shareholders’ agreements, partnership agreements, sales contracts, employment agreements, non-disclosure agreements, sub-contractors’ agreements, financial agreements, etc.
Conclusion:
As mentioned earlier, involving a lawyer from the outset of your business will ensure that legal compliance with the incorporating jurisdiction is met, annual maintenance requirements of the business are adhered to, and any potential disputes are discovered and prevented as much as possible. However, engaging legal counsel at any point during business planning, completing a business transaction, or resolving a dispute is always an option that is available to businesses.
We hope this article helps answer your questions about the role of business lawyers and why you need one.
If you have further questions or need legal assistance with incorporation, or drafting a general business contract, partnership agreement, shareholders’ agreement or purchasing or selling a business, please do not hesitate to contact MJ O’Nions Lawyers & Mediators at 604-449-7779.