Business law is a broad area that deals with many different aspects of business. This legal area governs such things as business formation and licensing, negotiations, contracts, business operations, and compliance with regulatory and legal provisions. There are many additional legal issues that may arise with running a business, including such things as intellectual property, real estate issues and employment matters. A business law attorney helps clients to start and operate their businesses while also helping to address legal issues that may arise.
When an entrepreneur wants to open a business, one of the first things that will need to be decided is the type of legal structure through which their business will be organized. There are several different choices, including a sole proprietorship, a limited liability company, an S-corporation, a partnership and a C-corporation, among several others. Each legal structure provides varying levels of protection against liability. They also have different reporting and tax requirements. Business owners do well to choose the structure that will work best for their particular business needs and can generally get help from an attorney to determine this.
Starting a Business
People who are starting a business need to familiarize themselves with all of the legal requirements for the type of business they will be opening. If they do not follow the legal rules governing their business, they run the risk of being fined or forced to close their doors. Some businesses require specific licenses, and others may be prohibited in certain areas due to local zoning laws and ordinances, for example. It is thus important for prospective business owners to thoroughly research the applicable laws in their area.
Almost all businesses need to draft and have in place business plans. Most lenders require plans before they will provide needed debt financing for the business. While many small business owners write these plans on their own, business lawyers may also help with drafting and reviewing them for their clients. These plans are often a part of a private placement memorandum, a disclosure document that is used to solicit equity capital from investors. The offering of securities is highly regulated by both federal and state law, and thus care should be taken when drafting these documents to make certain they meet all of the legal requirements. A business lawyer can be of assistance in this regard.
Business contracts play a large role in how most companies complete their day-to-day operations. In a business contract, two parties agree to do certain things in exchange for mutual consideration. These are primarily drafted in written form and signed by both contracting parties. In order for a contract to be formed, one party must make an offer that the other party accepts. Consideration must then be given. Contracts normally specify which party will perform what duty. They may detail deadlines for completion, product delivery and other matters. In some cases, the parties include clauses within the contracts that detail how breaches will be handled and what will constitute a material breach. Business law attorneys often draft and review contracts as a routine part of their practice.
Disputes often arise during the course of operating a business. They can cover a variety of matters, including employment disputes, discrimination complaints, contract disputes, alleged breaches of fiduciary duty and intellectual property infringement. While some disputes may be resolved through informal negotiations, mediation or arbitration, others end up proceeding to business litigation in court. Resolving a dispute may be highly complex and will often depend on very specific facts and details.
Business law is a broad legal area that covers many different aspects of starting, forming and running a company. It is important for owners to familiarize themselves with the particular facets of business law that govern their enterprises. Many issues can be avoided by learning about the law and regulations to which the company must adhere.
The information on this page is meant to provide a general overview of the law. The laws in your state and/or city may deviate significantly from those described here. If you have specific questions related to your situation you should speak with a local attorney.
Additional Uniform Commercial Code Articles
- What is the U.C.C.?
- What is Article 2 of the U.C.C.?
- Does Article 2 treat merchants the same as non-merchants?
- Are there fundamental principles that Article 2 always applies to?