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Dependently Independent-cont’d

Posted on July 25, 2007

By James Montague

On Monday we discussed the importance of the money guy, our accountant.  Sure they are kind of dry at the Christmas party but you won’t find a bigger asset to your independence!  That being said, this next group of people are as important in my mind as the money guys; the attorneys. Ok hold the lawyer jokes at least for a little while, (or better yet post a few of them here for some laughs) while we discuss the attorney’s role in your business. 

Reason one: contracts.  Unfortunately in the world today there are plenty of people looking to get rich the “new fashioned way” - sue someone!  Everyday in our businesses we are either signing legal documents or asking someone to sign ours.  And if we are all completely honest with ourselves how much do we really know about all that language beyond “This contract is between….”?  I fancy myself somewhat of a closet lawyer as probably most of us do but think about it, we are signing contractual obligations each and every day with no REAL understanding what repercussions are!  Sure, hopefully we will never have to deal with the uglier side of tort law but is it worth the gamble?  Find an attorney that understands your business and train them on your needs.  Honestly there are many times that a quick phone call can resolve issues before they ever even arise.  (And some of the time your attorney won’t even charge you for the advice!  Shhhhhh!)

Reason two-business entity structure.  I’m going to take an informal poll; everyone that has their company set up as a sole proprietor raise your hands.  Just an educated guess on my part but more than half of you raised your hands.  And most of the time that structure is going to be fine.  But on the other hand let’s say you did sign something like we discussed above and now someone is knocking on your door saying you are “at fault” for something!  Are you safe?  Can they get your personal assets?  Your savings, your car, your house?  Certainly these are all questions for an attorney but there are many business entity structures that can give you some firewall safety between your business and your personal assets.  Have you had that conversation?

I’ve covered what I consider two of the biggest legal issues facing small business and certainly both can jeopardize your independence.  Maybe you guys can post some other needs that an attorney can address for small businesses; I’d love to hear your feedback.


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