The Legal Underpinnings of Business Law

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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 own a business, and many people go on to do so with knowledge and without having the proper knowledge. Working for two non-profit organizations much knowledge was gained in knowing how to operate these entities effectively and meeting with success. It was not easy due to the many mistakes made by management. Understanding the business is paramount before starting or working for a company. Many people only think about the possibility of making money but very few evaluate the possibility of losing money. Business Matrix A corporation is a separate legal entity which is incorporated through the legislative process of going through a registration process. A corporation either operates as a non-profit or profit organization. The corporation has to follow the lawful rights and obligations that are different from the employees and shareholders. Corporations have some good and bad with its formation. The creation of a shield that will protect individuals from legal responsibility and personal liabil... ... middle of paper ... ...s obligated to pay, up to the policy limits selected. Reference Clarkson, K., & Miller, R. (2012). Business law: Text and cases: Legal, ethical, global and corporate environment. Mason, OH Cengage. http://www.cengagebrain.com.au/content/clarkson70828_0538470828_01.01_toc.pdf Lair, M. (2013). Business Law and Liability Exposure. http://mayrsom.com/2013/08/16/business-law-and-liability-exposure/ Seaquist, G. (2012). Business law for managers. San Diego, CA: Bridgepoint Education, Inc. Breach of Contract, (2014). http://jec.unm.edu/education/online-training/contract-law- tutorial/breach-of-contract Liability Insurance, (2014). http://www.hiscox.com/small-business-insurance/liability-insurance/ Limited Partnership, (2012). General Format. http://business.ca.gov/StartaBusiness/DefiningaBusiness/LimitedPartnership.aspx

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