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Friday, October 29, 2010

Forming a Florida Limited Liability Company Or Corporation Fast

By Stephen Nelson
Are you a small business or investor who needs to form a Florida LLC or corporation really fast? Not a problem. Fortunately, the state of Florida provides several opportunities for you to accelerate your llc formation or small business incorporation.

Quick Tip #1: Do-it-yourself LLC Formation and Incorporation

Not all states let regular business people--entrepreneurs, investors, microbusiness owners and so forth--form their own limited liability companies and corporations. In the state of Illinois, for example, while you can form a corporation or LLC without the help of an attorney or accountant, the check used to pay for the formation needs to come from an attorney or accountant. And in the state of South Carolina, articles of incorporation must be filed by an attorney. You don't get the option of "do-it-yourself incorporation," therefore, in South Carolina. (Note: In South Carolina, just to be fair, you can form your own LLC.)

However, Florida does provide entrepreneurs with the option of filing their own articles of formation or incorporation. The Secretary of State even goes so far as to provide simple, free forms and instructions on her website.

Doing the article filings yourself saves time because it allows you to cut out all of the time (days, weeks or whatever) spent waiting around for a local professional to get to your project.

Quick Tip #2: File Your Articles Online

This sounds almost too simple to be true or too obvious to be useful. But I'll make the point anyway: File your articles of organization or articles of incorporation online. By using the Florida secretary of state's website to file, you'll not only eliminate the time required to move documents through the mail, you'll find that the actual articles get processed more quickly by state employees.

Note: Not all states allow for online filing of business formation documents, as unbelievable as that may seem. California, for example, requires either by-mail or in-person filings.

Because the exact URL for the page to file online changes every so often, I won't give it to you in this article. However, if you visit the sunbiz dot org website, you should be find the web page that allows to you file online in few minutes.

Note: Florida takes only a day or two to process an LLC formation or incorporation that's submitted online. Paper "by mail" filings as long as a week.

Quick Tip #3 - Use Boilerplate LLC Operating Agreements or By-laws

Another way to speed up the formation of your Florida corporation or limited liability company: use boilerplate corporate by-laws or a boilerplate limited liability company operating agreement instead of hiring a local attorney to prepare the custom-tailored documents.

Your operating agreement or corporate by-laws are really important to get right. But just how "good" the operating agreement or by-laws need to be is debatable when you're talking about very small LLCs or family corporations.

No one who's honest and thoughtful, by the way, will tell you that a boilerplate operating agreement or boilerplate by-laws are just as good as customized, professionally-written governing documents. No way! But a professionally drafted document is not only expensive--such paperwork requires extra time.

Because of this, some LLCs and corporations (particularly those with one owner or husband-and-wife owners) might be inclined to use a simple, cheap, bare-bones operating agreement or by-laws document. Using such a document should save you several days of time when forming your new corporation or LLC.

The Difference Between an S Corp and C Corp

By Chantell Frazier
S Corp and C Corp - do you know what's the difference between the two?

As the owner of a corporation, you will enjoy benefits such as a share of the profits. This profit is normally shared out in the form of stock dividends. On the other hand, you will also be liable for the debts of the corporation in most cases. There are two main types of corporations that you may form: the C Corporation and the S Corporation.

A C Corporation can be converted into an S Corporation through a process known as an "election". Generally speaking, business owners will not be liable for corporate debt incurred in a C Corporation. However, if an entrepreneur has personal debt, they will remain liable in this respect. Normal C Corporations are taxed twice. This entails having to pay income taxes on profits as a business, and thereafter sharing out the profits to the business owners who are also required to pay income tax. On the other hand, if you own an S Corporation, you will only be taxed once as an individual who needs to pay income tax on income received from the business, and not as a business because the S Corporation is not required to pay taxes.

There are some advantages that an S Corporation enjoys over a C Corporation. For one, as a business owner of an S Corporation you will generally pay less in taxes. This is especially useful for the small businesses which are essentially business partnerships that feature few individuals involved in the running of the business. As a result, the operating costs of the S Corporation are less than those of the C Corporation, thus allowing the business owners to enjoy a direct inflow of profits.

As such, owners of an S Corporation will see the profits flow to them automatically. The only downside is that along with the profits, the debts will also automatically flow to the owners. What this means is that in the event that your business is operating at a loss, as a business owner, you might find yourself incurring personal liability for the debts of your business. This lifts the corporate veil and confers S Corporation owners with both tax liability and legal liability. On the other hand, if you own a C Corporation, your small business will get to retain as much of the profits as you like.

Notable Differences

Income Tax - The main difference between a C Corporation and an S Corporation is the means by which the small business owner will be required to meet their tax obligations. While a C Corporation is required to pay income tax, an S Corporation is not.

Individual Tax Liability - As the owner of an S Corporation you are liable for meeting your individual tax obligations. However, this is not the case with the C Corporation as the business owners may or may not have individual tax liability.

Individual Debt Liability - When it comes to individual debt liability, C Corporation owners are not liable unlike the S Corporation owners who are liable.

The Benefits of Limited Liability Companies

By James Witherspoon
Limited liability companies (LLC) are the most recent addition to commonly accepted business structures in the United States. Though they are recognized by the IRS as legal business structures, there is not a specific set of tax regulations that govern this business structure. An LLC is unique in its ability to take on any type of management approach yet still provide specific protections for the business owner for complete liability for the debts and losses of the business as a entity. Because of this benefit, this business structure is rapidly gaining use and popularity.

As is implied by the name, the major benefit of this structure is the limitation of liability for the business owner. In this sense, a LLC offers protection similar to a corporation, in that the business entity itself is responsible for any debt or loss that occurs. A business owner's personal property cannot be affected in the same way that it could be in the case of a sole proprietorship or a general partnership.

Though corporations provide structured safety for the personal property of a business owner, any profits or expenses are likely to be taxed twice, both as a gain for the business and as a personal income for the recipient. An LLC is different because it allows for pass-through taxation which can help avoid double taxation of the gains of a business owner. But an LLC can be managed and file taxes as a corporation, sole proprietorship or a partnership depending on the management of the company. This flexibility is another unique benefit of an LLC structure.

Because LLCs can be operated as corporations, they can have a form of shareholder which is referred to as a member. Members of an LLC can be any number of entities, including other LLCs, individuals or corporations. LLCs have a great deal of flexibility in their structure. But there are regulations as to which types of businesses can file as an LLC. These regulations are specified by states and the allowance of a business to register as an LLC is at the discretion of the individual state.

Demand Of Performance Under Contract Laws

By Chaudhry Omar Ejaz
1. INTRODUCTION:

The fulfillment of the legal obligation in a contract is called performance of the contract. Chapter vi of the contract Act deals with the performance of the contracts.

2. OBLIGATION OF PARTIES TO

UNDER CONTRACT ACT:

According to sec 37 of contract Act. The parties to contract must either perform or offer to perform their respective promises. Unless such performance is dispensed with or excused under the provisions of this Act or any Other law.

3. DEMAND OF PERFORMANCE:

Following persons can demand performance of the contract.

(I) PROMISEE:

Promise can demand the performance of the contract.

> Example:

A promise to B to pay 1000 Rs to C. If A does not Pay the amount to C. It is only B who can demand performance of Contract By A who made promise.

(II) LEGAL REPRESENTATIVE:

If promise dies, his legal representative can demand the performance of the contract.

> Example:

A borrowed some money from B. B died - 1 The legal representative of B can demand the performance of the contract.

4. BY WHO CONTRACT MUST BE PERFORMED:

Contract must be performed by the following persons.

(I) THE PROMISER HIMSELF:

Contract may be performed by the promiser. Either himself or through other competent person.

> Example:

A promises to paint a picture for B. A must perform the promise himself.

(II) AGENT:

Contract may be performed by Agent of the promisor.

> Example:

A promise B to sell goods A may perform his promise himself or through his agent.

(III) LEGAL REPRESENTATIVE:

Contract may be performed by legal representative.

> In Case of Personal Skill:

In case of contract involving personal skill, the legal representative of deceased arc not bound to perform the contract.

> In Case of Not Personal Skill:

In case of contract not involving personal skill but impersonal nature the legal representative are bound to perform the contract.

(IV) THIRD PERSON:

When a promise accepts performance of contract form a third person he can not afterward enforce it against the promisor.

> Example:

A borrows Rs 5 Lac from B and promises to repay within a year. After few months C the brother of A pays Rs 5 Lac to B. B accepts the money. A is discharge from the liability to pay.

What Is a Limited Liability Company? A Brief Explanation

By Spencer Holt
A limited liability company (or LLC) is a type of company that protects its owners from the debts, lawsuits, and other obligations that the company acquires. In other words, the owners have "limited liability" just as shareholders would have in a corporation. However, unlike a corporation, the owners are only taxed for the same income once. This means that when the company makes money, you only pay taxes when you receive your share of the profits.

What else makes an LLC different? For starters, it usually requires less paperwork. You don't have to make several reports to various government departments. Even regular meetings with a board of directors aren't required. It's because of this that many startups and new businesses file their company as an LLC rather than any other kind of business entity. Also, because of the minimal paperwork, fees, and requirements, LLCs are relatively easy to set up. There are even services for expedited filing if you need your LLC filed and running in 24 hours.

Still, a limited liability company is not as perfect as it sounds. Sure, you have limited liability when you start, but you must make sure that you always follow both the state and your LLC's guidelines so that your limited liability protection isn't lost. If there are any activities you have that may be viewed as misconduct, it's best to consult a lawyer who is familiar with the business laws in your state so that your limited liability protection stays intact.

Keep in mind also that not all types of businesses may be filed as LLCs - it depends on your state's laws. In some states, business owners should file law and architecture firms as partnerships instead. Check your state laws if you suspect that your type of business won't be allowed to file as an LLC.

Commercial Litigation Solicitors - What Is It, And Why Do You Need a Specialist?

By Tom Pearson
Commercial litigation covers a wide range of possible issues. Generally it covers any disputes or contests within a commercial situation. Common examples of commercial litigation include breaches of contract, fraud and professional negligence.

At some point it is likely that most businesses will have some form of commercial litigation to contend with. When it happens it can often cause a huge amount of stress for those involved. In some cases it can also end up having a significant financial impact on the company. In order to make sure that the smooth running of your company is not affected by legal proceedings, it is important to choose your legal representation very carefully.

When it comes to resolving commercial litigation issues it is still surprising how many people choose to use non specialist legal representation. Though technically they are able to deal with litigation issues, they are far less qualified to do so than specialist commercial litigation solicitors.

The wide range of possible disputes that can arise in a commercial setting are numerous, diverse and often extremely challenging to resolve. In order to resolve many of these issues successfully a solicitor needs to have extensive experience working in this particular area of the law. Firstly, your solicitor needs to understand the problem. Many issues that arise in a commercial environment are very different to those in most other areas of the law. In order to help resolve the issue your solicitor needs to understand the problem as well as how to resolve it. Secondly, your solicitor needs to know how to best conduct themselves in order to find a suitable solution. Finding a solution will often require a huge amount of sensitivity and diplomacy. As well as this, it will also be greatly beneficial to use commercial litigation solicitors who are used to dealing with clients from your particular commercial sector. Their familiarity with the terminology and way that you work will help smooth things along towards a favorable outcome. The third and perhaps most important advantage of using specialist commercial litigation solicitors is their understanding of how the legal proceedings affect you and your business. Due to their extensive experience in this particular area they will understand the process intimately. This intimate understanding will make it a lot easier for them to explain the finer points of your situation to you. It will also make them far more able to advise you and act in your best interests. This level of service will help reduce the amount of stress involved for you and leave you feeling that you have made the right decision throughout the process.

Legal Issues Regarding Articles of Incorporation

By Bill Abernathy
Most states have standard documentation that must be filled out in order to form a legal entity. These forms have been condensed to ensure that lawyers cannot submit lengthy incorporation documents filled with unnecessary information. The information that is most important on these incorporation documents is the name of the business entity, the name of the owner or registered agent, the names of the officers and/or directors, as wells as a clear purpose as to why the corporation should exist.

Corporate lawyers who specialize in wording that will be most beneficial to the corporation normally write the purpose section of the incorporation documents. General language is most often used in today's documentation, however it was more common years ago to draft a purpose with specific information that could be understood by the courts.

Nowadays, when a corporation is formed, the purpose can be something like, "to perform business for any lawful purpose." In the years prior, though, the purpose would be specific to a certain area of business. For example, if it were a business that served ice cream, the purpose would be to serve ice cream and nothing else. The corporation would not legally be able to branch out into other businesses, so the same corporation wouldn't be able to open a retail shop. The law eventually changed because companies - such as the ice cream company - wouldn't be allowed by law to serve hot dogs and hamburgers, even though it made perfect sense to sell all types of food at the establishment. If the company decided to sell items other than ice cream and somebody complained, there would be a legal battle in the courts. Eventually, the courts decided that it would be wrong to limit a corporation's future endeavors by following the initial purpose laid out in the articles of incorporation to the T.

These limitations made sense back many years ago, but in today's society, corporations need to be able to engage in many types of different business activities and invest in new opportunities. The modern way of completing the standardized articles of incorporation allows corporations to diversify and invest in any business allowed by law. If the old way of limiting a corporations purpose were still in effect, there would be many more lawsuits every time a corporation did not follow the specifics of the purpose section in the articles of incorporation.

In order to craft a well-worded purpose, a corporate lawyer experienced in business law should draft the section. This will ensure that a newly formed corporation will be able to invest in new ventures and opportunities as they arise. Furthermore, a well-written purpose will keep you out of court and allow you to pursue contracts without fear of violating your articles of incorporation.

Public Sector Solicitors - What Are the Specific Legal Demands of the Public Sector?

By Tom Pearson
The public sector (PS) is in many ways very complicated. Many of the services which need to be carried out in the UK require PS departments to co-operate with many other departments and outside organisations. By doing this they are expected to deliver a huge range of products and services on behalf of the government.

Due to the fact that they are working on behalf of the public, one of the biggest challenges faced by the PS departments is the accountability that they have. Everything they do must be justified because they are funded by UK taxpayers.

This accountability means that the way PS services are delivered changes frequently. The people and organisations that public sector organisations work with are in constant flux and responsibilities change on a very frequent basis.

The constant evolution of how services are provided can often lead to fairly complicated legal issues. PS services often need to deal with very delicate and sensitive cases. In some instances these cases are not managed as well as they should be. The legal issues that these shortcomings can bring about can range from simple negligence, up to the far more serious charge of corporate manslaughter. In cases like these legal proceedings will clearly need to identify where the shortcomings were, and inevitably, who was to blame.

In the past very few solicitors have chosen to specialise in this area of the law. Recently however, many legal firms have recognised the acute need for specialised public sector solicitors to help those dealing with complicated public sector legal cases.

Legal issues that arise in the PS require a legal representative to have very specific experience in that field. Without this experience it is unlikely that a solicitor will understand the full details of the case. More than anything, a solicitor dealing with public sector law must intimately understand the roles and responsibilities of literally hundreds of departments and organisations. The only way to gain this experience is by specialising.

Why Use a LLC Operating Agreement

By Steven W Cook
In Arizona, as in many other states, very few formalities are required to form an LLC, in short: articles of organization filed with the Arizona Corporation Commission (ACC), publication of articles of organization in an approved newspaper, and an affidavit of publication sent to ACC. However, it is advisable to take one further step when forming an LLC: create an operating agreement. An operating agreement serves two main purposes: 1) protect the owners from creditors and 2) protect the owners from each other.

1) Protect The Owners From Creditors

One of the main issues that owners of an LLC run into is creditors who want to pierce the corporate veil, i.e. creditors who want to remove the limited liability protection which an LLC affords. This can occur when the owner(s) of the LLC do not respect the LLC as an individual entity because the owners(s) treat it as an alter ego. For example, when an owner of the LLC pays his personal debts through the LLC, he/she is using the LLC as his/her alter ego. An operating agreement often helps to persuade courts that a particular LLC is not merely the alter ego of its owner(s).

2) Protect The Owners From Each Other

Most of the reasons for having an operating agreement regard the protections the owners of an LLC will have from each other. Although few people go into business with each other planning for the occurrence of unfortunate events, such events often occur and a well-written operating agreement should address the following issues in an effort to protect owners if such events do occur:
a) ownership percentage,
b) management,
c) distributive share,
d) voting,
e) ownership changes, and
f) default rules.

a) Ownership Percentage

Often, members of an LLC will see fit to apportion ownership relative to the contributions of the owners to the LLC, e.g. cash, equipment, etc. However, there are instances where one owner will not be providing extensive capital contributions, rather, future services. Because of this the owners of the LLC may wish to apportion ownership in a manner other than with respect to capital contributions. The beauty of an operating agreement is that it can allow such apportionment to occur and make record of such apportionment.

b) Management

LLC's can either be member-managed or manager-managed. A member-managed LLC is just that managed by its members. The members will each act for the benefit of the LLC and have authority to bind the LLC.

In contrast, a manager-managed LLC is managed by managers selected by the members of the LLC. These managers can also be members of the LLC, but they need not be. This is often desirable in situations where some of the LLC's owners are passive and not involved in running the business. In this scenario, members cannot ordinarily bind the the LLC.

c) Distributive Share

The share of the LLC's profits and/or losses is typically allocated in accordance with the ownership percentage of the owners. This is often desirable even in cases where one owner contributed capital and another contributed services as the ownership percentage need not be tied to capital contributions as mentioned above. However, there are instances where special allocations of profits and losses are indeed desirable. For example, one of the LLC's owners contributes substantial capital as a short-term investment and requires that the LLC pay him/her a disproportionate percentage of the LLC's profits and loses during the initial years of the LLC's operations. Such allocations are often permissible, but there are special rules that apply to such allocations so as not to run awry of IRS regulations.

d) Voting

An operating agreement should define the decisions that require a formal vote to occur, e.g. sale of business or assets, change in business operations, etc. An operating agreement should also set forth the percentage of votes required to approve such an action, e.g. majority vote or unanimous vote. Further, an operating agreement should also specify the basis upon which owners are granted voting rights, e.g. per capita or percentage ownership.

e) Ownership Changes

When one, or more, of the owners wishes to sell his/her ownership interest in the LLC, a buyout provision in the LLC's operating agreement should be triggered. Such a provision details how the owner's interest shall be valued as well as the rights of the other owners to block the sale to a prospective buyer.

f) Default Rules

State LLC statutes include default provisions that will apply unless the LLC's operating agreement overwrites such default provisions. Sometimes these default provisions are acceptable to the LLC's owners, however, sometimes they are not. It is important for the owner(s) of the LLC to consider these provisions and make certain that the LLC's operating agreement overwrites any provisions that are found to be unacceptable.

Acceptance Under Contract Laws

By Chaudhry Omar Ejaz
1. INTRODUCTION:
The law of contract is a very important branch of Mercantile Law. It is that branch of law which determines the circumstances in which promises made by the parties to a contract shall be legally binding on them. Acceptance is signification of assent to the proposal. It takes two to make a bargain. So acceptance of the proposal is essential to the formation of an agreement. Without the acceptance of the proposal, no agreement can come into being.

2.DEFINITION
Section 2(b) defines acceptance as follows:
"When the person to whom the proposal is made signifies his assent thereto, the proposal is said to be accepted. A proposal; when accepted, becomes a promise."

Thus, "acceptance" is the assent given to a proposal, and it has the effect of converting the proposal into promise.

3.ESSENTIALS OF A VALID ACCEPTANCE:

I. It must be given by the Offeree:
An offer can be accepted only by the person to whom it is made. It cannot be accepted by another person without the consent of offerer. If anyone attempts to accept it no contract with that person arises.

Similarly, in case of an offer to a particular class, it can be accepted by any member of that class. If the offer is made, to a general public, it may be accepted by any person who has knowledge of the existence of the offer.

2. It must be Absolute and Unconditional:
In order to convert the offer ir.o an agreement, the acceptance must be absolute and unconditional. If the offeree imposes any condition in his acceptance it is not a valid acceptance but a counter offer. As a result of counter offer there will be not contract until the counter offer is accepted by the original offerer. An acceptance must be according to the terms of the offer. A counter offer actually rejects the original offer.

3. It cannot be accepted after Refusal:
If a proposal is once refused, it terminates unless renewed. Actually, when the offeree once rejects the offer, he has no offer to accept. An offer once rejected cannot be accepted again unless a fresh offer is made.

4. It must be in a Prescribed Manner:
If the offerer in his offer has prescribed any particular manner of acceptance, it must be given according to that.particular manner. If no particular manner is prescribed in the offer then acceptance should be made in a reasonable manner. If acceptance is not made according to the prescribed manner, the offerer may reject it. The offerer must reject the acceptance within a reasonable time, otherwise he is bound by that.

5. It must be Communicated by the Acceptor:
In order to form a contract, the acceptance must be communicated to the offerer in a clear manner by the offeree or bis authorized agent. Mere expression of intention to accept an offer is not a valid acceptance.

6. It may be Express or Implied:
When an acceptance is given by words spoken or written, it is called express acceptance. When it is given by conduct, it is called implied acceptance. Sometimes the proposal, instead of being made to a definite person, is made to the public. In such circumstances the contract arises when the person accepts it by words or conduct. Law recognizes both express and implied acceptance as valid.

7. It must be an Acceptance of all the Terms: Acceptance of proposal is the acceptance of all the
terms and conditions of a proposal. If some terms are not clear, then those terms would not be binding. Acceptance should be of the whole of offer.

8. It must Follow the Offer:
Acceptance must be given after receiving the offer. It should not precede the offer. Acceptance always follows the offer.

If someone performs any act in ignorance of the proposal, there will be no contract because without an offer, no acceptance can be made. The offer must come to the knowledge of offeree then he can accept or reject it.

9. It must be given before Revocation of Offer:
In order to be valid acceptance, it must be given within the specified time limit. If no time limit is mentioned, then acceptance must be given within a reasonable time.
Acceptance must be given before the offer is revoked by reason of offeree's knowledge of the death or insanity of the offeror.

Bailment Under CONTRACT Laws

By Chaudhry Omar Ejaz
1. INTRODUCTION:
Bailment means a legal relation that arises whenever one person delivers possession personal property to another person under an agreement by which the later is under an obligation to return the property to the former.

2. MEANING:
The term baillment is derived from a French word 'baillior' which means to deliver.

3. DEFINITION ACCORDING TO CONTRACT ACT SEC 148:
"A bailment is the delivery of goods by one person to another for some purpose upon a contract that they shall when the purpose is accomplished be returned or otherwise disposed of according to the directions of the person delivering them.

4. PARTIES OF THE CONTRACT OF BAILMENT:
There are two parties in the contract of bailment.

(a) Bailor:
The person who deriveds the goods is called bailor.

(b) Bailee:
The person to whom the goods are derived is called bailee.

5. ESSENTIALS OF CONTRACT OF BAILMENT:
Following are essential of contract of bailment.

(I) CONTRACT:
It is a basic essential for bailment.

(II) MOVEABLE PROPERTY:
Property must be moveable in contract of bailment.

(III) DELIVERY OF GOODS:
The delivery of goods should be made for some purpose under a contract.

(IV) CHANGE OF POSSESSION:
In bailment possession is changed from one person to another person.

(V) SPECIFIC PURPUSE:
The goods are delivered for some specific purpose to another person.

(VI) OWNERSHIP IS NOT CAHNGED:
The ownership is not change. It remain to bailor.

(VII) PARTIES OF CONTRACT:
There are two parties to the contract of bailment bailor and bailer.

(VIII)RETURNABLE:
The goods must be returned to the owner of property or disposed according to the direction of bailor.

6. DUTIES OR RESPONSIBILITIES:
Following are the duties or responsibilities of bailee.

(I) CARE OF GOODS:
Bailee is bound to take as much as care as the man take care of his own good.

(II) ACT ACCORDING TO THE CONTRACT:
Bailee is bound to act according to the contract of Bailment.

(III) NOT DENY THE TITLE:
Bailee can not deny the title of the goods delivered to him.

(IV) RETURN THE GOODS:
It is the duty of Bailee to return or deliver the goods to bailor or according to his directions.

(V) RETURN AT PROPER TIME:
Bailee should return the goods at proper time.

(VI) RETURN OF PROFIT:
Bailee should return the goods at proper time.

(VII) PROPER USE OF GOODS:
He is duty bound to return the increase or profit to bailee.

7. RIGHTS OF BAILEE:
Following are the rights of Bailee.

(I) RECOVERY OF LOSS:
A Bailee is entitled to recover damages If he suffers any
loss.

(II) RECOVERY OF COMPENSATION:
A bailee is entitled to receive compensation from the bailor for any loss resulting from the defect of bailor title.

(III) RECOVERY OF EXPENSES:
Bailee is entitled to recover all expenses for any purpose of the bailment.

(IV) RIGHT TO RETAIN:
Bailee has right to retain the goods until debtor claim is
paid.

(V) RIGHT OF INDEMNITY:
He has right to receive the amount of indemnity from bailor for any loss which may sustain by reason that the bailor was not entitled to make the bailment.

(VI) RIGHT AGAINST THIRD PERSON:
If a third person wrongfully deprives the bailee of the use or possession of the good bailed. He can file suit against such person.

(VII) RIGHT OF REMUNERATION:
He is entitled to lawful charges for providing services.

Appropriation Under CONTRACT Laws

By Chaudhry Omar Ejaz
1. INTRODUCTION:
When a debtor owes several distinct debt to a creditor and makes a payment which is insufficient to the whole debt, the question arises to which debt the payment is to applied. Section 59 to 61 provides the rules which governs the appropriation of payment made by a debtor to the creditors.

2. RULES WHICH GOVERN APPROPRIATION OF PAYMENT:
Following are the rules which govern appropriation of payment.

(I) APPROPRIATION BY DEBTOR:
The first rule which governs the appropriation of payment is laid down in sec. 59. It confers the right of appropriation upon the debtor.
According to this sec.
Where a debtor, owing several distinct debt to one person, makes a payment to him, either with express intimation, or under circumstances implying, that the payment is to be applied to the discharge of some particular debt, the payment If accepted, must be applied accordingly.

=> Application of Rule:
This principle applies to several distinct debt and not to a single debt payable by installments.

=> Example:
A owes to B other debt the sum of 5000. Rupees B writes to A and demands payment of this sum. A sends to B 5000 Rupees. This payment is to be applied to the discharge of the debt of which B had demanded payment.

(II) APPROPRIATION BY CREDITOR:
The second rule is laid down in sec 60. which enables the creditor to make appropriation payment According to this section
"Where the debtor has omitted to intimate, and there are no other circumstances Indicating to which debt the payment is to be applied, the creditor may apply it at his discretion to any lawful debt the payment actually due and payable to him from the debtor, whether its recovery is or is not barred by the law in-force for the time being as to the limitation of suits.

=> Example:
A owes several debt to B. one of them Rs. 2 Lac is time barred. A sends Rs. 4 l.ac to B without Indicating to which debt the amount is to be appropriated. B may appropriate Rs. 2 Lac against the time barred debt.

(III) APPROPRIATION BY LAW:
The third rule is in sec. 61.
When neither party makes any appropriation of payment shall be applied In discharge of the debt in order of time. Whether they are or are not barred by the law in force for the time being as to the limitation of the suit. If the debt are ol equal standing the payment shall be applied in dischrage of each proportionately.

=> Application:
It applies when neither party makes an appropriation. In this situation the law gets the right to appropriate the payment.

=> Example:
A owes two debts of Rs 4 lac each which are time barred and another debt of 8 lac to B. A sends Rs 4 lac. Neither party makes any appropriation of Rs 4 lac would be appropriated rateably against two debt of Rs 4 lac each which are time barred.

3. CONCLUSION:
To conclude I can say that, under contract Act 1872. Sec 59 to 61 provide the rules which governs the appropriation of payment made by a debtor who owns a number of distinct debts to his creditor.

Corporate Solicitors - Who Should Use Them?

By Tom Pearson
The corporate world is a large and varied one. Anything from huge multinational companies, right down to one man, or woman, businesses fit under this same 'corporate' banner.

As you might expect, everyone that fits under this banner is at some point likely to need some legal representation or advice. This is where corporate solicitors come in. Corporate solicitors specialise in dealing with all aspects of the law which are relevant to businesses. These aspects can include anything from mergers, acquisitions or restructuring to basic issues of copyright or corporate tax. The range of legal issues which can have a significant relevance to businesses of all sizes is astonishing. It is amazing that even specialist corporate solicitors are able to keep tabs on it all.

The wide ranging nature of corporate law makes it even more astonishing that people still often choose to use a non specialist solicitor to handle their legal issues. For anything beyond the simple, straightforward legal requirements of a business, using a non specialist solicitor will put you at a huge disadvantage.

An opinion which is held by many is that specialist corporate solicitors are only for large companies with complicated legal issues which need resolving. This opinion is a long way from the truth. Small businesses need specialist legal advice just as much as the larger companies. Often small businesses, when legal issues do arise, are affected far more directly than larger companies. A simple issue of copyright infringement or corporate tax can put a large strain on a smaller company. In these situations having a specialist on hand will make the process a lot easier for you.

Using specialist corporate solicitors means that you are dealing with people who have seen hundreds of cases like yours in the past. They know the stress that these issues put on the people involved and are able to offer the support you need to get through it. Specialist solicitors will also have a far superior knowledge of the details of your case, and how best to proceed.

For larger companies, the need for specialist legal representation is just as important. Often, because of the money involved in the legal issues that larger companies have, having the best legal representation is well worth the money. You can also be sure that your opponents, whoever they may be, will be thinking along the same lines. In order for larger companies to achieve a satisfactory result from their legal proceedings it is imperative that their legal representative has the resources, experience and eye for detail to ensure that nothing is missed and that everything that should be done, is done.

Commercial Solicitors - Reasons Your Business Might Need Them

By Tom Pearson
Whether you are the CEO of a multinational company or an individual just starting out as a freelancer, at some point you are likely to need commercial solicitors.

So what are they? Though there are many solicitors who choose not to specialise in the services they provide, the large majority choose to specialise in a particular area. These areas are varied and diverse. Some key examples are personal injury law, family law and the one we are interested in, commercial law.

Commercial law is itself a very wide reaching subject. It loosely includes all aspects of the law that have an impact on commerce and business. Commercial solicitors specialise in providing legal advice and representation for companies who require it.

So what legal needs could a company have, and more importantly, are they relevant to your business?

Very few businesses are run in exactly the same way. The number of different sectors and niches within each sector are huge. This means that the legal requirements of each business will always be slightly different. That said, there are a number of legal requirements that almost all businesses share. One thing that most businesses have in common is employees. No matter how many employees your business has, they all still have the same rights. These rights have an impact on how much you are allowed to pay them, how much holiday they are allowed, how you begin, or end employment and how they are treated in the workplace. If an employee ever feels that they are being denied any of these rights then you have a legal issue which is likely to need the attention of specialist commercial solicitors to resolve.

Another factor which all businesses must deal with is tax. Corporate tax can often be very complicated. The laws that apply to businesses are very different to those applied to individuals. As such, it is very important to get advice from people who know the ins and outs of corporate tax. Unlike individuals, if a business miscalculates the amount of tax it is due to pay the deficits can be huge. This can cause a huge amount of stress and expense. In these cases having a professional who is used to these situations can prove invaluable.

Other key areas which apply to most businesses include contracts, mergers and takeovers and banks. Also, the safety of your employees in the workplace is becoming an increasingly common concern of commercial solicitors. With legal issues involving any of these crops up it is certainly worth seeking out specialist commercial solicitors. With their experience and understanding of the commercial market, they will ensure that your issues are resolved quickly and with the least amount of possible stress.

Incorporation 101 - What Type of Legal Entity Should I Choose?

By Alexander Zehnbacht
Once decided to become involved in a new business venture, how would you know which legal entity is the right for you? The choice of entity would influence many aspects of the life of your business, from taxation to liability limitation and more.

Let's start by reviewing the most common types of entities, available for people doing business in the United States.

Sole Proprietorship

A sole proprietorship is a type of business entity which is owned and run by one individual and where there is no legal distinction between the owner and the business. All profits and all losses accrue to the owner (subject to taxation). All assets of the business are owned by the proprietor and all debts of the business are his debts and he must pay them from his personal resources, meaning that the owner has unlimited liability.

A sole proprietor may do business with a trade name other than his or her legal name. This also allows the proprietor to open a business account with banking institutions. It is a "sole" proprietorship in the sense that the owner has no partners.

Establishing a sole proprietorship is cheap and relatively uncomplicated. You don't have to file any papers to set it up - you create a sole proprietorship just by going into business. In other words, if you'll be the only owner of the business you're starting; your business will automatically be a sole proprietorship, unless you incorporate it or organize it as an LLC. Of course, you do have to get the same business licenses and permits as any other company that goes into the same business. It is also advised to register a DBA ("Doing Business As") name with the state for your business.

Advantages of Sole Proprietorship:

* One takes all the profits of the business - no corporative taxes on the profits made,
* No double taxation,
* Easy to start up,
* Relatively fewer regulation,
* Full control over the business,
* Easy to discontinue,
* Quick decision process and no opposition when taking a decision.

Disadvantages of Sole Proprietorship:

* Unlimited liability - owner of the business is responsible for the business's debts,
* If business becomes successful, the risks accompanying the business tend to grow,
* Hard time raising capital - owner has to make up for all the business's funds,
* Sole proprietor is responsible for his or her own health insurance.

C Corporation

C Corporation is a type of business entity that is organized under specific provisions of the General Corporation Law. A Corporation must have corporate officers and bylaws, and must be registered with the State. In addition, the corporation will be taxed at the State and Federal level on its earnings.

A corporation offers the protection from personal liability for the owners. This "corporate veil" of protection does not offer protection from liability in the case of fraud, failure to pay taxes, under capitalization of the corporation, or commingling of personal and corporate funds.

Most major companies (and many smaller companies) are treated as C corporations for Federal income tax purposes.

Advantages of C-Corporation:

* Limited Liability - owners of the business are not personally responsible for the business's debts,
* A corporation may qualify as a C corporation without regard to any limit on the number of shareholders, foreign or domestic.

Double taxation - C Corporations are subject to corporate taxes, therefore creating the effect of double taxation (first on corporative level, and then on shareholders' personal level).
Disadvantages of C-Corporation:

S Corporation

Similar to the C Corporation, S corporation offers all the benefits of a corporation, but with a different tax structure. S Corporations pay no Federal income tax, but pay state level tax. S corporation's shareholders report the company's income or losses on their personal tax returns.

Despite the obvious tax benefits, S Corporation comes with several restrictions. Major restrictions are:

* Can't have more then 100 shareholders,
* All shareholders must be physical entities - or simply put, real persons, not corporations, partnerships, etc (there are few exceptions for non-profits),
* All shareholders must be U.S. citizens or residents,
* Must have only one class of stock.

Limited Liability Company (LLC)

LLC combines the limited liability protection of a corporation (hence the name) with the flexibility and pass through taxation of a partnership/sole proprietorship. Like the shareholders of a corporation, the owners (members) of an LLC are not personally responsible for the debts or liabilities of the LLC.

The LLC has no limitations on who may be involved, and it can be managed by its members or by managers. It is often more flexible than a corporation and it is well-suited for companies with a single owner.

Advantages of LLC:

* Limited Liability - owners of the business are not personally responsible for the business's debts,
* No double taxation,
* No limits on number of members.

Disadvantages of LLC:

So Which Type of Entity Is Right For Me?

The answer to this question depends strictly on your specific needs and circumstances. We always recommend our clients to discuss those specifics with a professional CPA or business attorney, however, it is equally important to educate yourself prior to scheduling appointments. After all, it is your business.

Business Lawyer - Learn Why You Might Need One

By Abraham Avotina
You will find that nearly any company is better off with an attorney, which is why most companies have at least one on retainer for help at all times. Whether you are just starting out in your industry or have established your business already, you will find this kind of professional very useful. Find out what a business lawyer typically does for most companies.

Most businesses need contracts of various kinds, and a good attorney can draw them up for you easily. Rather than attempting to write your own and hope that they hold up in court, allow a business lawyer to construct or at least edit contracts that you will use at your company. This will ensure that if you ever encounter trouble in your company, you will be protected legally.

Some industries constantly need a good business lawyer, as there are various regulations and codes that must be adhered to. If you feel too busy to keep up with new laws that go into effect in your field, allow an attorney to keep you updated. For example, the building industry often has codes that must be adhered to, or you may face fines or even court cases. Avoid trouble by keeping someone around who will constantly remind you of any recent updates that might affect your company.

Sometimes things go wrong with clients or employees, and businesses get sued. Having an attorney may not prevent people from getting frustrated and threatening to sue, but it could reduce the chances of them actually going through it since they will know that they might not win. If they do go through with it, you will need a business lawyer more than ever, so it will be especially good to have one around. It is just smart to protect yourself from potential lawsuits brought on by angry clients or employees, especially since companies of any kind can face these issues.

Clearly, just about any company can benefit from having an attorney on hand to help at any time. It does not matter what field you are in or how successful you are, as most lawsuits and legal troubles are hard to predict. You can choose whether to retain legal help, which is advised for large companies, or just seek assistance when you need it. Either way, it is recommended that you get in touch with local lawyers to find out your options before you encounter legal trouble.

Business Law - What You Need to Know

By Nicolas DAlleva
Business law is the body of law that governs business and commercial transactions. Also, known as commercial law, it is considered a part of Civil Law, and can be deal with issues in the both the private and public spheres of law. It encompasses anything in which money is transferred from manufacture and shipment of goods to corporate contracts and hiring practices. Although many other countries have adopted civil codes or a unified system regarding Commercial Law, the United States, where it falls under the control of the United States Congress, does not officially have a unified system or code for Commercial Law.

The closest thing to a standard set of rules is the Uniform Commercial Code, which has been adopted parts of all 50 states, the District of Columbia, the Commonwealth of Puerto Rico, Guam, and the US Virgin Islands. Until every state adopts the code in full, the Uniform Commercial Code cannot be considered a national system. Until then Congress will solely control interstate trade, while the state police of each state will regulate trade within their respective state. The problem with the Uniform Commercial Code is it is not law itself, but merely suggestions of what states should adopt as Commercial Law. This was done so that states could make changes when adopting its "suggestions" as laws in an attempt to fit it within local regulations. To keep the code in touch with the business community and new American civil laws, there is a panel ranging from private and publicly traded company presidents to Supreme Court Judges. An example of a state choosing to not adopt all of the Uniform Commercial Code is Louisiana, which chose to adopt the document in its entirety, with the exception of Article 2, where it instead decided to continue tradition of using its own Civil Law in regard to the transaction of goods.

The two main facets of Business or Commercial Law are commercial transactions and more specifically the client/vender relationship and the general laws regarding proper practices within a business (ranging from employment to bankruptcy).

In regard to trade, commercial law describes the wide body of laws that govern business transactions. Most of these laws stem from suggestions from the Uniform Commercial Code (UCC). The UCC is divided into nine articles, covering a broad spectrum of issues that arise in commercial transactions. These articles govern all things related to transactions with specific emphasis on the following: sales of goods, leases of goods, negotiable instruments, bank deposits, fund transfers, letters of credit, bulk sales, warehouse receipts, bills of lading, investment Securities, and secured transactions. The one exception to the rule in which trade is regulated by laws stemming from the UCC is the issue of Maritime Trade, which is regulated by Admiral and Maritime Law. Basically Business Law covers everything from the buying of raw goods to the bank deposits after the final product is sold.

The second facet of Business Law, the lawful and proper running of a business, covers all things between transactions. This is with particular emphasis on employment practices and contracts. An example of Business Law regulation in regard to employment is the Occupation Safety and Health Act. This act, as its name implies, encompasses proper working conditions, benefits, and other things regarding the safety and health of employees in a business.

In conclusion, Business Law, in its two facets of running a business legally and making legal transactions, is a body of Civil codes and laws meant to govern commercial transactions and business. Commercial is anything in which money and or goods are transferred or exchanged. Although the United States does not have a Unified Business Law, the Uniform Commercial Code (UCC) has been partially adopted by all states and territories under its jurisdiction

Sole Proprietorship Business - 3 Drawbacks to Owning a Sole Proprietorship

By C. J. Harrison
There's a great freedom to owning your own business. Being a sole proprietorship let's you manage every single aspect of the business. However, with this freedom comes an enormous responsibility with just a touch of risk. With every advantage of owning a business there lays a disadvantage. There are several drawbacks to owning a sole proprietorship.

By being a sole owner of a business, you have responsibilities to your customers and employees. The risks involved with owning a business are shown below. If you are considering becoming a sole proprietorship, you may want to keep these in mind:

a. While you may have complete control over every decision made in the business, you are also held personally liable for any and all debts and/or obligations. This also means that you are responsible for any liabilities from employees of your company as well.

b. Finding investors for your business can be hard. For some reason, investors won't normally invest in sole proprietorships. This could be due to the fact that all responsibilities lie in the hands of one person rather than a group of people

c. All decisions will fall on the sole proprietor. Whether it is a simple choice to be made or a difficult one, the decisions must be made by the owner.

If you are considering owning a sole proprietorship, it is imperative that you understand both the benefits and the risks. Being 100% responsible for the business can be a huge risk and you must be ready for it. Once the risks are understood, it will be easy to get your business running successfully.

Do Your Mega Group Documents Include an Operations Agreement?

By Jeffrey L Cohen
Physicians are becoming more and more willing to pool their practices together in large group practices in order to (1) negotiate managed care contract rates, (2) develop ancillary service revenue sources, and (3) get some cost savings from economies of scale in such areas as professional liability insurance, EMR and the like. This is great news for physicians!

The dominant format of such a large group, a "mega group" is what has come to be called the "Umbrella LLC" or "Super LLC" model. Simply put, the model consists of a limited liability company (the "Big LLC") which owns multiple limited liability companies ("Sub LLCs" or just "Subs"). Physicians are owners of the Big LLC and are employed by it. The Sub is comprised of the practice that joined the mega group. Physicians looking to join a Mega Group have many things to get comfortable with such as: governance, income sharing and overhead sharing. Physicians need legal and financial advice to guide them in that process. That said, what many physicians often miss is an agreement between the Super LLC and the Sub which is designed to protect their autonomy to the maximum extent allowed by applicable law. This sort of agreement, which we can call an "Operations Agreement," should be part of every mega group transaction.

Mega group transaction documents often contain more legal and financial jargon than clear language about operations and what actually happens within the practice that joined the mega group. An Operation Agreement is designed to address the particulars within the Sub (operational and financial matters) and to ensure the independence of the sub, which "houses" the group that joined the mega group. For instance, once the mega group takes a management fee to pay for centralized expenses, what do the physicians in the Sub do with the money? Usually, mega group documents only address the fact that the Sub gets the money. But now what the Sub does with the money (i.e. who gets what). This is just one example of the many important issues that ought to be addressed in an Operations Agreement, including who gets to make decisions in the Sub, how to handle compensate disabled or retiring physicians, and hiring and firing matters within the Sub.

Mega groups present a terrific opportunity for today's physicians. That said, they have to make sure the documents address their legal, financial and operational needs.

Role of Business Litigation Attorneys

By Fred Pisani
Business litigation is a law specialty which basically aims to defend companies charged of some kind of delinquency. By legal proceedings a claim towards compensation could be attained through business litigation. Here an accused is a litigant and the accuser is a complainant. Other businesses, employees or consumers may have a court case or lawsuit filed against a company. There are various businesses set up options available for example proprietorship, partnership, joint ventures, limited partnerships, limited liability companies, sub-chapter S corporations, and regular (or C) corporations. Whichever option you choose to go with, will certainly have an effect on your entire business. There are different entities which may have contradictory tax costs or penalties attached to them, both State and Federal. Here it becomes all the more important to determine which entity to make use of.

The tax consequences associated with choosing the correct form of business entity is indeed a complex task and you should well consult an experienced legal attorney in this area so that you may receive good suggestion or plan in order to make a wise business decision to move forward with. Also, in the same lines the tax consequences associated with regard to the sale or purchase of businesses is really devastating. If you are not particularly cautious in this line, you can be burdened with the tax accountability of the former business later on. Furthermore, the portion of the purchase or sale price will have an undesirable tax consequence either to you directly or to the other party involved. Therefore it is very vital to take care of these things well in advance.

Through the entire life span of your business entity you will be confronted with various choices that need to be opted on a day-to-day and yearly basis. Some typical instances are as follows:

If your partner dies, whats in store for you?
God forbid but if you become disabled, what could be done?
If your co-owner retires, what steps need to be taken?

These are just few of the several areas that need to be taken care of in a right way and thus it is very essential to have an experienced attorney in this field who can safely guide you through the troubled times.