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Dallas Business Law Topics

Family business succession and protection

Many businesses in Texas are started by relatives or married couples. Other businesses may be started by an individual but with the hope that one day the business will be passed on to the founder's children. These situations all require some smart, proactive and strategic planning in order to ensure the business continues to be properly managed.

As explained by Entrepreneur magazine, a prenuptial agreement can be a useful tool in a variety of situations. For couples who own and operate a business together, it may provide some protection for the business in the event that the couple divorces by outlining provisions for ownership of the company ahead of time. If one person owns a business alone and then gets married, a marital contract can identify the business as that person's separate property.

How anticipatory repudiation may affect your small business

As a small business owner, you likely deal with contracts all the time. That is, you may regularly execute leases, purchase agreements or fulfillment contracts. When you enter into a contract in good faith, you expect all parties to honor its terms. If someone does not do so, your organization may sustain damages. 

While you do not have to be a lawyer to understand the terms of an agreement, you should know about anticipatory repudiation. According to the Uniform Commercial Code, anticipatory repudiation allows the non-breaching party to protect its interests when the other party does not perform. Obviously, knowing about a future breach as soon as possible makes sense for any organization. Here are three ways anticipatory repudiation may arise: 

Understanding breach of contract damages

At the law firm of Palmer & Manuel, PLLC, in Texas, we help many business owners negotiate and draft their numerous contracts. Since contracts represent such a large part of any business, having a good written contract with each of your partners, suppliers, independent contractors and a myriad of others best serves your interests.

Despite the best contract and the best intentions of its respective parties, however, breaches occasionally occur. When this happens, you have the right to sue the offending party for breach of contract. The University of New Mexico explains that in any such suit, you can collect two types of monetary damages,  compensatory and punitive.

Considerations in choosing a business structure

When you create a small business in Texas, you have choices as to what structure it will have. At Palmer & Manuel, we know that there are so many different ways of forming a new business that it may be difficult to decide which structure is best. 

Both your situation and your long-term goals can assist you in deciding on a business structure. According to FindLaw, the following criteria may be helpful considerations in reaching a decision in that regard. 

What limitations are set on debt collections?

It is not uncommon for a small business in Texas to have customers owe it money. Depending on the type of business you run, you may often sell items to customers on credit. Doing so means that you should also have a collections process in place to go after customers who do not pay their debt. When you do any type of collections, you should understand debt collection laws in the state to ensure you are not breaking any.

According to the Texas Office of Consumer Credit Commissioner, there are various things the Texas debt collection law says you cannot do. This law picks up where the federal law drops off, meaning that it covers you when collecting your own debts.

What is title insurance and do you need it?

When buying a home or any real property in Texas, you may have an offer to buy title insurance. This is an expensive line item charge on the Closing Disclosure or Closing Statement charged by the title company. You should make sure that you understand what this is, how it works and why you may want to get it.You also need to get information so you can make an informed decision about buying it.

Can a tenant break a lease?

A commercial shopping center has the potential to produce a high return on investment with a blend between stable anchor tenants and lucrative outparcel or subdivided tenants for a landlord. A key factor to being able to attract and retain quality tenants is the type of lease, terms of the rent or Common Area Maintence (CAM) fee, and any personal or corporate guaranty on the lease. Therefore, it is vital to establish both a strong understanding of your goals and a relationship with your attorney who will draft and negotiate these terms on your behalf.

The three main types of commercial leases include: form of net lease, where the tenant pays a percentage of usage of common costs such as parking lot maintenance, share of utilities or property taxes, gross lease, where the tenant pays a fixed amount each month which provides all services from landlord, and finally, a percentage lease which may incorporate features of the above leases along with a percentage of gross sales payable to landlord.

Does your LLC need an operating agreement?

Starting a new business often involves significant document preparation, and you may wonder if you can forgo some of the steps involved in the interest of saving time and money. The short-term solution would be to file and prepare only the minimum to begin operations. The long-term advice is to plan and budget for a robust set of documents which clearly describe all interactions between parties.

If you form an LLC, Texas state law does not require that a limited liability company draft, sign or maintain an operating agreement other than the statutory template agreement provided as a default. However, your business may not fit the standard terms. Each business will have unique partners, financing, or contractual risk that should be clearly written down to reflect your intentions. If you value the time and energy in forming the business, you and your co-owners should memorialize the terms of the partnership because it may help prevent future disputes among the owners of the LLC and protect your limited liability status in the courts.

What types of businesses are there?

As a prospective business owner or entrepreneur in Texas, you may be wondering how to start your business. Every business requires organization and a clear understanding of the need to maintain and keep documents. Palmer & Manuel, PLLC, can provide a clear breakdown of the types of documents that every business will begin to create. We offer a complimentary consultation to assess your liability protection and organization of all documents.

You deserve payment

You did the research, connected with your clients and complied with all of the necessary regulations to get your financial business off the ground. With all the work you put into it, you expect other people to do the same and to repay their part of your partnership. At Palmer & Manuel PLLC, we want to help you get what you are owed if your Texas investments do not go exactly as planned. 

What you may not know is that you are entitled to many of the same legal protections as the major national corporations, even if you are the owner of a small financial company. Furthermore, your contract may give you specific powers of which you are not aware or which you are unsure how to enforce.

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Palmer & Manuel PLLC
8350 N. Central Expressway Suite 1111
Dallas, TX 75206

Phone: 214-242-6444
Fax: 214-265-1950
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