Business Law Today

A common situation that millions of small business owners will deal with on a regular basis is frivolous law suits. According to the U.S. Chamber Institute for Legal Reform, small businesses spent $98 billion in 2005 defending frivolous law suits, this means that the cost to defend these law suits, is only increasing as more business are finding themselves as targets. While this is no doubt concerning, the reality is that you can be able to protect yourself and your business from this kind of litigation by using different tactics that will protect your business should it ever be the defendant of one of these law suits. Below are different tactics to help you protect your business and yourself from these law suits.

Have good business organization: The first kind of legal defense that you want to use is to develop a business structure that will protect your business against these kinds of law suits. This means establishing a corporation or limited liability company. What happens is most small business are set up as sole proprietorships which means that as a business owner you are responsible personally for the debt and what ever obligations that the business may have. If your business is the subject of a law suit you they could try to go after everything you own including the assets of your business. What you want to do is establish a corporation or limited liability company that will be the initial line of defense against these kinds of law suits. Please note that while this will generally protect your business this form of legal defense can be overcame by a serious legal challenge.

Create forms that will document everything: The next line of defense that you want to establish is a customer and employee disclosure forms where they have to read, sign and date. In general many disputes begin by one person claiming to have promised something while the other party says they did no such thing. To protect your business against these types of situations requires that you create a legally binding document, with the help of your lawyer, that will spell out what are the responsibilities of your business and what are the obligations of the person you are dealing with. By having them read, sign and date this document will ensure that if this kind of dispute does come up you have something in writing which shows what was discussed in addition to the fact that they understand the situation, helping to prevent their law suit from going any farther.

Clearly frivolous law suits are a major concern for many small business owners. By using the above tips you can be able to protect your business against the different types of law suits that your business could face from either employees or customers. This will help you to protect your business and your personal assets.

Tags: At Will, Business, Business Law, Business Organization, Company, Corporation, Debt, Frivolous Law, Ins, Law, Law Suit, Lawyer, Legal, Limited Liability, Limited Liability Company, Litigation, Small Business, Small Business Law, Small Businesses

Related posts

• Corporation Law (7)
• Commercial Law (26)
• The Pocket Lawyer for Filmmakers: A Legal Toolkit for Independent Producers (0)
• The Entrepreneur’s Guide to Business Law (0)
• Liability Law (2)

Tags: At Will, Business, Business Law, Business Organization, Company, Corporation, Debt, Frivolous Law, Ins, Law, Law Suit, Lawyer, Legal, Limited Liability, Limited Liability Company, Litigation, Small Business, Small Business Law, Small Businesses

You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.