November 1, 2018
By Lori Lindsey
Nobody needs an attorney until suddenly they do. And when that time comes, the client is usually in quite a mess. Fortunately, business law is an area where many messes can be prevented by hiring an attorney at the outset. An attorney can help a business prevent problems with clients and contractors in a number of ways.
The first step to creating a successful business is filing the appropriate paperwork with the Secretary of State. There are a number of different types of business you can form, from Sole Proprietorships to Limited Liability Companies to Corporations. Each type of entity has its own requirements, its own benefits, and potential pitfalls. Consulting an attorney (and probably an accountant, to be honest) can help you determine which entity is right for you. Further, an attorney can help you fill out the paperwork.
Some entities require business owners to create Corporate Agreements or Bylaws. These documents state the rights and responsibilities of the owners and partners of the business. Oklahoma (and many other states) have default provisions, which are a good starting point, but these defaults might not be the best for your unique situation. For instance, if one partner is investing money into the business, while the other is investing their time, knowledge, and labor, the default provisions might not be the best for either party.
Many businesses have standard contracts that they use for different situations. These contracts spell out the requirements of both parties, limit the liability of the business, and often state a remedy for breaches of contract. It is always a good idea to have an attorney review the terms of the contract, especially if it is one you use frequently, to make sure you and your business are protected in the event of a dispute. Just because a term is in a contract does not necessarily mean that it will be upheld by a court should the controversy go to litigation. Plus, litigation is costly and most people want to avoid it entirely. Why not have an attorney review some of your most frequently used contracts? It could save you a lot of time, money, and headaches in the long run.
Another good use for an attorney in a business context is to draft an employee handbook. Employee handbooks can spell out specific procedures that employees must follow for certain aspects of their jobs. These handbooks can also spell out the rights and responsibilities of the employee, benefits to the employees, expectations of the employees, etc. It’s similar to a contract in that it lays out the benefits and risks of both parties, so it’s wise to have an attorney review or even draft the handbook to make sure all of the provisions will hold up in court.
These are just some of the simple things that an attorney can do for business owners small and large to help avoid litigation in the first place. This allows the business owner to focus on running and growing the business, instead of constantly worrying about the what ifs.