California Business Legal Questions

I would suggest you set up an LLC.  The LLC can then create the website.  Further, the LLC can create independent contractor agreements with whoever wants to join in. There will be other questions as you seek to open your business.  In my experience, working with a lawyer before you begin will pay big dividends in the future. I have written a legal guide with issues you should discuss with an Internet lawyer.  I have placed a link here for your convenience:  https://www.avvo.com/legal-guides/ugc/legal-steps-to-opening-a-new-e-commerce-website-app-or-blog    ... Read Answer

One cannot form an S-Corp.  The process requires that you first create and file the Articles of Organization of a C-Corp, then file IRS Form 2553 with the IRS seeking approval to be taxed as an S-Corp.  Once the IRS sends you a letter of approval, you may then enjoy the pass-through taxation benefits of an S-Corp and avoid the double taxation of a C-Corp.... Read Answer

You can, but if I was your neighbor I wouldn't sell it to you, since contracts with minors are voidable at the minor's option.  In other words, your neighbor would be bound, but you wouldn't if you had second thoughts.  If I was your neighbors, I would draw up a contract of sale with one of your parents instead.... Read Answer

An LLC or corporation doing business in California has to pay franchise fees and taxes (as well as doing certain filings), regardless of where it is organized or incorporated; the state in which the LLC is organized or the corporation is incorporated will also require annual fees and taxes. There is no advantage to paying twice the fees and taxes. If you only operate in California, organize your LLC in California.... Read Answer

If you want to do business the right way, now is not the time to penny pinch. Think about hitting a golf ball; if you are off just slightly when you hit the ball, it will go sailing in the wrong direction and end up far away from the point you wanted to hit. If you start your business on the wrong foundation, you could end up in trouble later. I've fixed countless companies set up on LegalZoom or other sites when people literally guessed at the answers to questions. If you are educated and know the answer to all the questions, those sites may be a good option. If you don't understand the questions and/or guess at answers, you are not doing yourself any favors. Yes, you save money up front, but you will likely have to spend MORE money later fixing the problems you cause. All that having been said, the first thing you need to do is call your CPA and find out the most tax-advantageous form of business for YOUR particular business. Right now, S Corporations are popular, but they are not for every type of business. Once you know the type of business you want to set up, you need to learn what the law requires both for setting up the business and your legal obligations after it is set up. If you simply set up a corporation and then never do any of the legally-required corporate formalities, it is possible you could lose your "corporate shield" -- the thing that protects you from personal liability.  I understand it costs a lot of money to set up companies (having a logo made, setting up a website, etc.), but the corporation is what will protect you from liability, if set up and maintained properly. I wish you all the best in your new business venture!      ... Read Answer

From a legal standpoint, there is a difference between a partnership and an LLC. The type of document you would need depends on which of those two types of businesses you have. But in either case, there should have been an agreement between your partners (or LLC members) that addresses this situation. If you have such an agreement in place, review it to understand what must be done in your situation. If you do not have such an agreement, I suggest you see a lawyer in your area to prepare an agreement for you. The reason this is not a do-it-yourself type of agreement is, depending on the language included in it, the agreement could still hold you liable for things that arise in the future. There are a lot of issues to be addressed in the sale or transfer of a business, such as non-competition terms, division of liability, and more. Best wishes.... Read Answer

Who owns the name and logo?  If you personally, no problem, go ahead and use them.  If the llc, cause it to tansfer those assets to you.  Either way, apply for a trademark.  The only problem would be if the llc owes creditors which it can't pay, in which case any assignment of htose assets without consideration would defraud those creditors.  Creditors would include teh taxing authority.... Read Answer

I need to know more information to see if I can further assist you.  One thing that we need to learn about is how was the beneficiary in the policy, was it your sister only and was your name mentioned in the policy and how much.  If you were listed and for some reason, your sister received all the funds, then you may also have a claim against the insurance company.  Simply put, we need more information from you.... Read Answer

The rights of the shareholders would be set forth in a shareholders' agreement, which might provide, for example, that the majority owners have the right to buy you out for a set price.  Absent a contractual provision allowing it, the other owners cannot simply confiscate your ownership interest.  Of course, a 5% ownership interest only entitles you (again absent a contrary contract) to a pro rata share of distributions.  It doesn't entitle you to be employed by the company or to have a say in the company's management.... Read Answer

The short answer is yes, but of course it depends on how big of a transaction it is.  An experienced attorney will no doubt spot issues and potential problems that you may not (it's not only what is in the agreement, but what isn't, and specifically what contingencies have not been proved for), but will cost money.  Doing it without an attorney is a risk, but, depending on the size of the transaction, you may feel the risk is worth it.... Read Answer

You've asked two questions which are unrelated.  If the contract has a  valid arbitration clause, your client has to arbitrate her dispute with her client, regardless of whether she engages a lawyer or not.  If she contracted with her client individually, she has a choice of engaging a lawyer or handling the matter herself, and whether she should engage a lawyer or not depends a lot on how much is at stake.  There is no point to hiring a lawyer when the amount at issue is less than the lawyer's fees will be.  If she contracted through an entity, however, such as an llc or corporation, she will have to engage a lawyer since corporations and llc's cannot represent themselves (although sometimes this rule is relaxed in small claims court).  I see no reason to send the law firm anything.  They are not interested in the merits of her claim, they work for the homeowner, and will take whatever she sends them and try to use it against her.   BTW, you specifically sais that this was a letter from a law firm, not any legal papers connected with a lawsuit.  Obviously if what she actually received was a summons and complaint or other documents starting a lawsuit, she has to respond to it.... Read Answer

We would be happy to speak to you to determine what legal services you need in determining the fairness of the operational agreement you have been presented.  Any such review would include determining the factors  giving rise to your current situation, what your understanding of the arrangment might be and whether or not the agreement reflects that understanding.   Please feel free to contact us at the below number to further discuss your particular situation.     We look forward to hearing from you.   Very Truly Yours   Bruce A Hatkoff, Esq. Hatkoff & Minassian A Law Corporation Phone: (818)990-5180email: Bhatkoff@hatkofflaw.com  ... Read Answer

The answer to "can I be sued?" is always yes.  Anybody can sue anybody for anything.  Whether you would prevail depends on the likielihood of your name causing customer confusion, i.e. leading customers to think that they are dealing with the other store with the similar name, in effect trading on its goodwill.  This in turn depends on a lot of factors, including how distinctive the name (i.e. is it something like "Smith" or "bargain", or is it something like "adurabi's" or "fragilistic") and how much has the name become associated in consumer's minds with the type of business being conducted.  The fact that you sell to somewhat different markets improves your case, but not as much as if one business was a restaurant and the other an auto parts store.... Read Answer

It is very doubtful that the park would be responsible to pay these fees as part of the attorneys' representation - even if the retainer agreement provided that the park was responsible for the attorneys' own fees in a separate action independent of the rent increase litigation, which is very unlikely, such provision is unlikely to be enforceable in Court.  Of course, this doesn't mean that the attorneys won't try to bill for them.  Also, if the accusations are unfounded, it is possible that the attorneys could recover their expenses as damages in a lawsuit they bring for wrongful prosecution or some similar tort (e.g. abuse of process). ... Read Answer

Absent a contract limiting your right to fire her, you can terminate her employment at any time for any reason other than those prohibited by statute, i.e. based on race, religion, etc.  If you're asking about unemployment insurance considerations, I am not familiar with California's unemployment insurance laws, but I would be surprised if denigrating your business was not cause for termination. However, there are issues with paying someone as an independent contractor (1099) when they should have been classified as an employee (W2), because employers are required to withhold various taxes from employee's paychecks.  If you did not withhold  taxes because this person was classified as an independent contractor, it cculd lead to serious issues with taxing authorities.  I would advise you to consult a California attorney about this.... Read Answer

I can't tell you whether you have a "slam dunk", but there are issues here which could make a good claim or (depending on some facts which I don't know and which may be contested) coudl be a waste of time.  Some of the questions I would have are:           why didn't you receive any notification?  Was Shopify negligent or was the problem not of its doing, such as their notifications going into your junk folder or you chaning your email address without notifying them?;           does your contract with Shopify bar any claim for consequential damages (without getting into a long technical explanation, the damages you would be seeking are consequential damages)?  If so, and if the law that applies (might be California, might be where Shopify is, might be another jurisdiction specified in the contract) is like that of NY, that clause would be enforceable unless  you could show that Shopify was more than just negligent, but was at least reckless in failing to notify you;           why didn't you remember to renew your website?  Granted Shopify was supposed to notify you, but it wouldn't have been hard to note the date in your calendar;            who owns the intellectual property rights generated by your website under your contract with Shopify?  By using the trade name in commerce, you may have acquired common law trademark rights in it (I assume that you did not register the trademark), even if you no longer have the right to use the website.  If so, you would be able to prevent anybody else from using that name or a confusingly similar one in the same field of commerce.  Probably the Shopify contract precludes this, but you shoud check. It may be worth consulting with a California attorney, preferably one who is familiar with intellectual property law.... Read Answer

There may be a case for breach of contract, for failing to do the work properly, but you would probably only be able to recover the money you paid for them to clean the clothes, not the money you lost from losing customers.  It is not only very difficult to prove with any certainty that you lost customers, and how many customers and how much you would have made, because of the smell, but such damages are called "consequential damages", as opposed to direct damages, and are not normally recoverable in a breach of contract case except under particular circumstances. If I fail to repay a $1000 loan to you, the $1000 you lost are direct damages, i.e. damages that naturally flow from the breach.  If, because you didn't have the $1000, you couldn't buy a car and lost a job that would have  paid you $100,000 a year, those are considered consequential damages, i.e. damages which don't necessarily happen every time a loan isn't repaid but happened to occur in your situation.  These damagew are normally not recoverable unless they are within the contemplation of the parties at the time of contracting.  In other words, you may be able to recover them if you told me, at or before the time of the loan, that you would lose this job if I didn't repay you in time, but not otherwise.   In your case, where you lost customers because they didn't do the work right, it is a closer call, because that is more foreseeable and some courts may find it to have been within the contemplation of the parties at the time of contracting, but my bet would be that the damages would not be allowed.   Moreover, you have to think that if they ignored needed maintenance, they may be short on money and you wouldn't be able to collect. None of this is to say that you shouldn't consult an attorney in Ca. to look into your prospects, especially since it will probabl y coxst you little more to fule a suit seeking the return of they money you paid as it will to seek the additional damages, but my guess is that, given the problem  you will have proviing that the lost customers were due to the smell, the real question of whether these damages are recoerable, and the possibility that you won't be able to collect even if you win, you will probably decide not to pursue this claim if yoiu can get some money beck that you paid.... Read Answer