Zooming Your Way Into Litigation
Updated: Jan 12
These days anyone can get a template for business documents, or hire a paralegal to prepare your documents in areas of bankruptcy, divorce, or copyrights. In transparency, you should know that often times the lawyer is just handing over your file to their support staff to handle 95% of it. When someone is looking to create a entity or resolve a legal matter, who can fault them for looking at all the cost effective options ?
There are many decent services that provide boilerplate forms created by lawyers, which require you to fill in the blank, add a little content, and with just a few clicks... Tada! These services offer to give you the basics for a reasonable cost saving, compared to that of paying an attorney. However, there are some overarching issues with maintaining your operation while these documents control the beginning, middle, and end of the entity at issue.
The following are a few mistakes that you may avoid by having an attorney review what you've put in place so far:
1. Your template ignores the nuances of your industry;
2. Your template fails to address the nuances of your personal situation;
3. Your template inadequately addresses the context of your relationship to stake holders;
4. The templates fail to incorporate a growth, tax strategy, and liabilities;
5. You plan on seeking short-term or long-term funding;
6. Your template service failed to advocate your interests, so language that would have placed you on an even footing with the other persons in your entity is now lost; and
7. Your template fails to address outside life events that could impact your assets, liabilities, and options.
Ultimately, personalities and interests can change when a company faces significant success and challenges. Its not until you are facing such issues head on that you see what the people in your company (spouses included) are really like.
Another common mistake that avoiding the consultation and counsel of a CPA who can establish the tax consequences of your decisions. If you're going through a live changing event, and have intentions of holding, or growing assets, you should consider seeking the advise of a tax professional. Both the financial and legal consequences of moving forward with a LLC vs a Partnership can be significant, as can the decision to structure a settlement as damages vs stock purchase. The cost benefit analysis of bringing in legal and financial experts should begin with the burden of time, followed by liability or risk.
We regularly review documents and provide feedback on potential issues. If you'd like your legal documents reviewed, followed by a discussion regarding your concerns, contact us at info@Sentinellaw.com.