Corporate Legal Questions

Many LLC Operating Ageements include restrictions on transfers. As a single owner LLC, you might not have any operating agreement, and if you have one, it might be very short and omit such restrictions. If there is an operating agreement and it has such restrictions, then comply with them.  Same for any other assets transferred to the trust. Banks, insurance companies, and stock brokers all have their own rules for transferring assets  and accounts on their records. Find out what they want, whether they have forms they want, and comply. LLC member certificates are not required. The LLC's records of who owns it count. Dana Sack www.sackrosendin.com ds@sackrosendin.com 510-286-2200  ... Read More

The limited partnership law and the LLC law require approval by a majority of limited partners to convert the same business from a limited partnership to a limited liability company. So this could have been done with the permission of the other limited partners and without asking your permission. It is also possible to make other provisions for approving such a conversion in the limited partnership agreement. AS a member in a limited liability company, you have no liability for the company's debts, same as a limited partner of a limited partnership, unless you co-signed or guaranteed the debt. California imposes a tax on revenues of a limited liability company which does not apply to limited partnerships. So why convert from a from a company which does not pay that extra tax to one which does? Dana Sack ds@sackrosendin.com www.sackrosendin.com 510-286-2200  ... Read More

Probably, but not for sure. You need to check the Bylaws for rules regarding removal of directors. When voting for directors, shareholders are entitled to cumulate votes. If there are 3 vacancies to be filled at an election, each shareholder has 3 votes and can vote 1 vote each for 3 candidates, 3 votes for 1 candidate, or 2 votes for 1 candidate and 1 vote for another. This voting technique is intended to allow a minority of shareholders to vote together and get a director onto the board. The Corporations Code protects such minority-elected directors against removal by a formula which requires more votes to remove such a director. If you would like to hire us to help you with us, we could find that formula for you and check for strict compliance with the Bylaws and the Corporations Code. Dana Sack 510-286-2200 ds@sackrosendin.com www.sackrosendin.com  ... Read More

A court is supposed to enforce such a Bylaw provison, as long as it is fair and reasonable and was determined and put in the Bylaws in a manner which was fair and reasonable. If your brother opposed this Bylaw provision, it might not be enforced. His opposition, if proven, would be strong evidence that the provision was not fair and reasonable. The surviving spouse does not get to extort any price she can get away with. The court will determine a fair price. That can get expensive, with expert witnesses on both sides fighting it out. She and her child are still familiy. You might consider keeping them in the company. Otherwise, at least offer them a fair and reasonable price. If they don't ask for too much more, giving in might be cheaper than going to court. I have litigated such cases and settled them. If you would like me to assist you, please email me at ds@sackrosendin.com or call me in Oakland, CA at 510-286-2200.  ... Read More

If the divorce is still pending, then your attorney can simply subpoena the records and someone at AAMCO to explain them and authenticate them. Same for any salary he claims he paid you.  Have your attorney subpoena those records and find out whether he owes you anything and whether you owe state and federal taxes on money for which he or his company took a deduction but which they never paid to you. I would be happy to substitute into your case and issue the necessary subpoenas, but there is no reason your current attorney can't do the same. Dana Sack 510-286-2200 ds@sackrosendin.com www.sackrosendin.com  ... Read More

All boards, for profit and non-profit, have board members who work for, operate or even own other businesses. This is not a problem, unless the companies compete directly or do business with each other. There are ways to deal with such transactions. For example, an contract with a board member is presumed to be unfair to the company unless a majority of the board not including the conflicted member  approve the transaction. On the other hand, it is only presumed to be unfair, and that presumption can be disproved if the contract is in fact fair to the company. How do you prove that? Depends on the facts. The problems of conflicts is really the donor's problem, since he can be required to return any compensation his company receives back to the non-profit. It's in his best interests to guard against that. Donations are not a conflict. Contracts between the donor's other company or a company owned or run by any director, officer or employee and the non-profit could pose conflicts. Call me if any of those come up. Dana Sack 510-286-2200 ds@sackrosendin.com www.sackrosendin.com  ... Read More

Call your divorce lawyer. He or she can prepare and file an application to the court to order a hearing to determine whether or not your ex-spouse is in contempt of court. If the court finds her in contempt, typically the court first offers her an opportunity to correct the contempt. If she fails to do so, that is a second contempt and the penalty is $1000.00, 30 days in jail, or both, and reimbursement of your attorneys fees.  All you get is your attorneys fees and any money the court orders her to return to you. If you wanted me to undertake this, I would need the judgment and copies of the checks your customers sent to her instead of you. If they refuse, I could subpoena them, but that might be great for your business relations with them. I expect this would cost about $4000.00, maybe a little less. We charge $275.00 per hour and are paid monthly for our work. Dana Sack 510-286-2200 www.sackrosendin.com  ... Read More

If her legal name, whether obtained from her parents or approved by a court, is XXX, then you must respect her choice. However, you don't have to let her run for office under a fictitious name or a pseudonym.  You might ask her for proof that it really is her name. Check her drivers license, for example. Only owners of units may run. If her unit is owned in the name of anyone except Susie XXX, then she cannot be elected and cannot run. You should be able to call a title company and check the tax collector's records online to determine who actually owns the unit. Maybe you don't care, because is anyone going to vote for someone who calls herself XXX? Think about the other members of your association?  Are any of them going to vote for her? Sometimes it is better to just let people looking for attention to do what they want. If she is an owner and understands the issues facig the board, who cares what her name is? Dana Sack 510-286-2200 ds@sackrosendin.com www,sackrosendin.com    ... Read More

I am unaware of any law that prevents renters from being elected to an HOA Board, but all the CC&Rs I have ever written or reviewed have always required that all Board members be current owners. An owner who sells before the end of her or his term ceases to be a Board member at the close of escrow, even if she or he continues to live in the unit. Check the CC&RS. I expect you will find that they require ownership. Dana Sack 510-286-2200 ds@sackrosendin.com www.sackrosendin.com  ... Read More

To become a lawyer, you will need a four year college degree and then a law degree (juris doctorate). You undergraduate degree can be almost anything. I was an English Literature major. Many people get political science degree, but that is not a special track to law school. You simply need an undergraduate degree, and you need to have some aptitude for critical, logical thinking. I would add that you need to become a good communicator and a good writer to be a good attorney, though you do not need to be outgoing, or a good debater or be able to write a novel. You simply need to be able to communicate clearly and thoughtfully. Many people go into law school thinking they want to do this or that and end up going in a different direction. A "corporate lawyer" may mean different things to different people. It could mean "in-house counsel" for a corporation. In-house counsel work as employees of companies and work only for the company that employees them. A corporate attorney may mean working in a law firm that is hired by companies that do not have in-house counsel or to do things that in-house counsel do not do. Many in-house counsel do not do much litigation, and any litigation that a company becomes involved with is handled by attorneys in a law firm retained for that purpose. A corporate attorney may represent many small businesses (ma & pa businesses) helping people to incorporate, maintaining the corporate formalities, and advising the business on all the various things that come up from time to time in the business world - employee issues, contracts, resolving disputes, suing or defending lawsuits, etc. It is a lot of hard work. Sometimes attorneys and the law are not well understood. It can also be very rewarding and satisfying. I wish you well.... Read More

Anything that was discussed in Executive Session by the Directors alone is confidential and must be kept secret, unless someone was  specifically instructed to tell someone outside the meeting about it.  As a Director, you are a fiduciary for the corporation and your fellow Directors. Unless the Directors are conspiring to do something illegal or contrary to the best interests of the Corporation or all of itsmember, you are prohibited from revealing such secrets. Anything that was discussed in an open meeting of the Directors with other homeowners present, you can discuss with anyone, including the owners who are renting. Dana Sack 510-286-2200... Read More

One way is to estimate the value of his/her work and have the person earn his/her interest as the work is satisfactorily performed. Otherwise, you could have the person own a forfeitable interest with a work requirement before the interest stops being forfeitable. Perhaps, the main and most important thing you have to determine is how much this person's work is worth. This is not intended to be legal advice, and is general in nature.No attorney-client relationship exists or is formed by this information. Furthermore, this does not represent the views or opinions of LexisNexis or its affiliated companies.... Read More

The most conservative posture in a Chapter 7 liquidation is that the intellectual property was part of the bankruptcy estate and therefore is the domain of the Trustee to administer.  Once the Trustee has "abandoned" the assets or found it to be a "no asset" case, then you may claim your rights.  You may have contractual rights that would change this answer.  More likely than not, within a Chapter 11, the asset would remain a part of the Debtor In Possessions asset base and needed for the operation of the business -- in this case the DIP (Chapter 11 Debtor) does not lose rights to the asset.... Read More

Somewhere there is a law saying you can't, but there are no enforced sanctions or penalties, especially if you have filed for qualification and you're waiting for the SOS to get around to responding.  The principal sanction is that you can't sue to enforce a contract until you are qualified. What kind of business and what kind of work? For example, the rule for construction contractors getting their California construction license is a little different.  Same with some other trades and professions.... Read More

It does not look like the suspension was as a shareholder, but as an employee which would be totally independent of his rights as a shareholder. Are there any written agreements among the shareholders or between your husband and the company? Such agreements might contain applicable provisions which could affect his rights. This is not intended to be legal advice, and is general in its nature. No attorney-client relationship exists or is formed by this information. Furthermore, this does not represent the views or opinions of LexisNexis or its affiliated companies.... Read More

The short answer is, yes. Employers can dictate dress and appearance to a point. That point is as long as it is not unlawfully discriminatory. For instance, an employer could not impose restrictions on women that they do not impose on men. Most employee handbooks have language in them that allows the employer some leeway to impose additional workplace rules or to amend the rules. Unless you are under contract, your employment is likely at-will, meaning that you can be fired for any reason, or no reason at all, as long as it is not an unlawful reason (unlawful discrimination, in violation of the whistleblower laws, etc.). These are generalizations. There are exceptions. It all depends on how the handbook reads and other facts. Your new administrator and everyone at the facility work for the corporate employer, I assume. They dictate the rules. It sounds unfortunate in this situation that they would impose such a draconian rule without understanding the dynamics of the situation and the "color" you bring to the facility, but that is often the reality, especially with larger companies or companies that want thing "by the book". Perhaps, if you can convince the new administrator of the benefits of your colorful headdress, you might persuade the corporate office to relent. The problem, however, is that the new administrator probably does not know you well yet, and probably will not want to take the risk of "going off the farm" to protect your freedom at the risk of making the corporate office unhappy.... Read More

Generally, the board of directors would have to approve the share buy- back, subject to legal restrictions under state law depending upon the financial condition of the corporation. This is not intended to be legal advice, and is general in nature. No attorney-client relationship exists or is formed by this information. Furthermore, this does not represent the views or opinions of LexisNexis or its affiliated companies.... Read More

The question of creating a limited liability company that cannot be "breached" is a matter of proper formation, capitalization and operation.  Chapter 86 of the Nevada Revised Statutes provides liability protections for members of an LLC.  Generally no member or manager of any limited-liability company formed under the laws ofthe State of Nevada is individually liable for the debts or liabilities of the company. NRS 86.371.  A member of a limited-liability company is not a proper party to proceedings by or against the company, except where the object is to enforce the member's right against or liability to the company. NRS 86.381.  This latter statute allows members who are named to seek dismissal from the action. As far as identification of the owners of a limited liability company, there are some protections in that the annual corporate filings of a Manager-managed LLC only requires disclosure of management and not ownership.  While creating multiple layers of holding companies can create some degree of insulation from disclosure of details, you should understand that with additional layers of bureaucracy for creditors comes additional layers of bureaucracy for the entities and its management in being able to function. ... Read More

Dear Mr. Whiteley, Yes, a corporation can shield you from your personal assets being at risk when conducting a business/venture of some sort.  There are six (6) main different types of Texas corporations; you can "Google" to find out and/or, when you're ready contact us at (713) 910-5757 and/or via email to AttorneyGlass@yahoo.com Please note that we can discuss - and address - your options regardless of which Texas city in which you reside and/or conduct business, as Texas law is obviously the same statewide.  We have a large percentage of corporate (and other) clients, most currently from Brenham to Abilene, etc. Note that this site is using old information from 10+ years ago, so please contact me using the info. above instead of what Lawyers.com has"on file." Thank you, Howard L. Glass LAW OFFICES OF HOWARD GLASS, P.C. Great Southwest Building 1314 Texas Street, Suite 1100 Houston, Texas 77002 (713) 910-5757 Telephone (713) 237-0755 Telefax AttorneyGlass@yahoo.com ... Read More

These matters are generally set forth in the corporation's by-laws. As a general matter, the board of directors, not the president, has authority to remove any officer. However, the president may have authority to terminate the compensation of any employee (which is not the same as removing that person from his or her officership).... Read More

People wanted to do this in my town - it was controversial and I don't think it ever got off the ground.  Good luck to you.  Unfortunately, the requirements for a three person board are designed so that you have "back up" if you and the other person involved are not able to complete what needs to be done.  Have you considered seeking input/volunteers from the community?  Or other people from maybe the local SPCA or a veteranarian?  Try getting the third person on board before you start to do the formal documentation.... Read More