In the world we live in today lawsuits are prevalent and being sued by someone could cause the business to fold. It would be wise for one to obtain all the knowledge before starting a business and it is a reason why people use the term “knowledge is power” (Clarkson & Miller, 2012). As individuals, when we lack knowledge we perform practices unknowingly which could lead to major lawsuits. Ownership of a business can be formed as sole proprietorship, partnership, or corporation. Potential great profit is the reason most people want to start and some do start corporations. One must have knowledge, and understand business law in order to have a positive outcome with operating an organization (Clarkson & Miller, 2012).
Many people desire to
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The owners are all responsible for the financial obligation of the company. Legally the owners are responsible for the amount of money invested by one (Seaquist, 2012). With this partnership if one of the partners is negligent in ones dealings and the other owners are not, all would be held liable and accountable for the negligent actions of the one owner (2012).
Limited partners are not liable for partnership obligations. The partner’s risk ones agreed capital contribution, or whatever is stipulated in the partnership agreement. If a partner decides to operate the business, then one may lose the protected limited partner status and be held liable for all risk (Limited Partnership, 2012).
Limited liability corporations protect the owners from personal liability and can be established informally. This form does involve some of the features of the other forms of business (Lair, 2013). Many small business owners chose LLCs because it is easy to form and offers protection to the owner. Instead of the owner being liable for the corporation, the corporation is liable (2013).
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The breach is without legal excuse. A breach of contract occurs when obligations are not met that were agreed upon by people or companies (Breach of Contract, 2014). When one fails to honor the contract it becomes a breach in contract. To limit the liability within each organization one should complete any pending contracts, and negotiate with contracting party to compensate for the unfulfilled contract. Breaching parties have to pay punitive damages which are a form of punishment for not honoring the legal contract
A corporation was originally designed to allow for the forming of a group to get a single project done, after which it would be disbanded. At the end of the Civil War, the 14th amendment was passed in order to protect the rights of former slaves. At this point, corporate lawyers worked to define a corporation as a “person,” granting them the right to life, liberty and property. Ever since this distinction was made, corporations have become bigger and bigger, controlling many aspects of the economy and the lives of Americans. Corporations are not good for America because they outsource jobs, they lie and deceive, and they knowingly make and sell products that can harm people and animals, all in order to raise profits.
Jennings, Marianne M. Business: Its Legal, Ethical, and Global Environment. Mason, Ohio: Cengage Learning, 2008. Print.
Twomey, D. P., Jennings, M., & Anderson, R. A. (2011) Anderson’s business law and the legal
Sweeney, B, O'Reilly, J & Coleman, A 2013, Law in Commerce, 5th edition, Lexis Nexis, Australia.
Mallor, J. P., Barnes, A., Bowers, T., & Langvardt, A. W. (2010). Business Law: The Ethical, Global, and E-Commerce Environment (14th ed.). New York, NY: McGraw-Hill/Irwin.
Starting up an owning a business comes with a lot of benefits, decisions and planning. A benefit is being able to provide products and services to consumers as well as offering jobs. One of the most important decisions to be made is the type of business entity and the procedures of the company. One of the biggest things that a business owner needs to be prepared for is the legal aspect of running a business. This paper will include a matrix of each business, discuss the breach of contract lawsuit, and compare and contrast the personal liability exposure as well as look at the best organizational form for the business.
James G. Skakoon, W. J. King and Alan Sklar (2007). The Unwritten Laws of Business. /: Tantor Media.
A company is a corporate body of a corporation. A corporation is an artificial legal person. The law sees it as separate and independent of the persons who are members of that corporate body. The legal recognition given to the company is provided in Section 26 Separate Legal Personality of the Companies’ Act 2001 which states that:
What is the size of the business? Initially it will be a small business with the possibility that it will expand. What level of control do you want to have? Everyone dreams of becoming their own boss and is the reason most people go into business for themselves. What are the business vulnerabilities? Risk and liabilities should be determined and accounted for in the beginning. Risk and liabilities are a significant factor in determining coverage the business owner needs. What are the initial startup expenses? Depending on the nature of the business it could be just a business license. Other types of start-up expenses could include but are not limited to legal fees, material expenses, office space and labor...
Ferrell, O. C., Fraedrich, J., & Ferrell, L. (2013). Business ethics: Ethical decision making and cases: 2011 custom edition (9th ed.). Mason, OH: South-Western Cengage Learning.
Over the years, many entrepreneurs have created businesses having one goal in mind, which is become a successful business owner. The entrepreneur Mark Cuban once claimed, “Don’t start a company unless it’s an obsession and something you love. If you have an exit strategy, it’s not an obsession” (Business Insider). In other words, business owners have to love what they do if they want to reach a certain achievement for their business, but not all companies form the same way. All companies have the potential to be successful no matter which method an owner or owners chooses to work with. In the world of business, three types of ownerships are a sole proprietorship, partnership, and corporations.
A company as legal entity which has separate legal identity from its members and is ordinarily incorporated to undertake commercial business. A company is defined in different forms such as:
find it difficult to set up a business and make it a success. This is
When it comes to business, especially when it comes to starting one, I tend to think I know it all. Yet in reality, I don't really even know how to get started, enough to make a business efficient, or even get the doors open enough to make the first dollar. When I first think of working/operating a business, I think of no boss but myself, the rules are made by me and no one else, and that seems like a great plan in my eyes. As well as having all company profit coming directly to me, and I get to decide what happens with it. Although I know there is more to it than that, there is forming a budget, working with customers, knowing when to expand, and when to coast through. I also know that in the world of business, that if you aren't moving ahead, you are moving backwards.
The principal attributes of a corporation are: it is a legal entity separate from its shareholders, it owes its existence to the State; which also has the role to regulates its behavior, it provides limited liability to its shareholders, who are not liable for its debts or acts of the company, characterized by the freely transferable of corporation shares, its existence may be perpetual with a centralized management system in which shareholders do not manage the daily operations of the corporation, and it considered, for some purposes but not all a person and a citizen.