Business Law in California

If you are going to form a business entity in California you must decide what form your business entity will take. Your lawyer can best advise you on the legal and tax advantages and disadvantages of each kind of business entity so that you can choose the kind of entity that best suits your intended business practice.

The Partnership

You should always be careful to make sure you have a good business reason for forming any type of partnership or limited liability partnership (LLP). If you intend to form a partnership, consult a business formation so you may be aware of the risks involved in doing so. Each partner should bring a different skill or assets to the partnership; otherwise, there is no good reason for forming a partnership. In other words, you should only consider forming a partnership if you are sure that two plus two will equal five.

The Corporation or LLC

You must also be prudent in making sure you have a compelling reason for forming a corporation or LLC rather than a partnership, and be aware of the potential downside to any such organization. In order to do so you should consult an attorney well versed in business law in California.

The Negotiation and Arrangement of Commercial Leases

The commercial real estate lease is the most important legal issue many businesses will have to face. It is sensible to consult with a business law attorney when negotiating the terms of your commercial lease.

Avoiding Costly Litigation Through Arbitration

In order to protect against future litigation, consider including an arbitration clause in your contracts. That way you can steer any dispute that may arise toward arbitration rather than court.

In arbitration, a private judge, typically selected by the parties, settles the dispute. This judge, known as the arbitrator, may be a retired judge, a lawyer or just someone the parties agree to. Typically, both of the parties share the arbitrator's fees for their services.

Advantages of arbitration are many and include speed, being completed in weeks rather than the months or years that litigation can take, simplified procedures with far fewer technicalities, a very low cost compared to litigation, and the ability for witnesses to testify by affidavit rather than in person. The decision of the arbitrator will be final with no recourse to appeal whatsoever.

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