By: Matthew H. Fry, Esquire
In the age of do-it-yourself websites and preprinted legal forms, many small business owners may believe that consulting with a business lawyer is not necessary when starting up or operating their business.
While it is true that the websites and preprinted legal forms can be a useful starting point, the fact is that there are many aspects of a business that need to be custom-tailored to the type of business, the size of your business, and the business’ customers and vendors. A little in-person legal advice tailored to your specific business needs can go a long way to saving time and money in the future. Limiting your liability if your business is sued is the most obvious benefit, but what about preventing the threat of a lawsuit in the first place, making it easier to do business with your customers or vendors, or keeping your employees from learning your business model and moving to a competitor? A good business attorney will provide vital assistance in these and almost every other aspect of your business. All of these issues can be minimized by consulting with an experienced attorney that can advise you to make sure you are getting the most out of your business.
Customer Agreements. It is important that if you enter into any product or service agreements with customers, that the agreement not only comply with Federal and State regulations, but also that the contract gives you sufficient protection from liability while giving your business the tools it needs to collect on unpaid accounts. For example, if you are a contractor doing residential work in Pennsylvania, you need to be familiar with the Pennsylvania Home Improvement Consumer Protection Act, which has specific requirements to be included in every customer agreement. A failure to include all of the required sections could make your agreement unenforceable. Another example in the contractor setting is to be aware of the Pennsylvania Contractor and Subcontractor Payment Act (CSPA), which can be a strong motivator for an owner or contractor to promptly pay for work performed by a subcontractor.
Vendor Agreements. Whether you are looking to obtain a line of credit or need to enter an agreement with an office supply vendor, the devil is in the details to make sure your contract or agreement terms are fair to both parties. Fees, default clauses, personal guarantees and other terms may be hidden in the boilerplate that can restrict your ability to cancel the agreement or limit your remedies in case of an error. So when coming to an agreement with a particularly important vendor that supplies needed materials or services to your business, a review of the agreement is essential to make sure you are treated fairly and have options as your business grows or changes.
Employees. It is important to have work policies in place—and to be consistent in their enforcement. Employee policies on issues like general work rules, prohibitions against certain behaviors, such as what constitutes sexual harassment, and appropriate internet and email use are all important to give your employees guidance and helps protect the company from liability. In addition, individual contracts with employees may be necessary to protect business secrets or to prevent the employee from leaving to work for a direct competitor.
Litigation. While an attorney can help protect against unnecessary litigation, it cannot be prevented altogether. Additionally, your business may be the one who needs to institute litigation to enforce a contract or protect its trademark or business secrets. An attorney with experience in business litigation can protect a business, as well as use the legal system to your advantage if and when necessary.
These are just a few examples of how a business lawyer can help you resolve disputes quickly, protect your business, and provide valuable guidance to interact with your customers, vendors, and employees. And, while you can save some upfront costs in your business by using legal forms, self-help books and websites, these materials should only be a starting point, and not a replacement for sound legal counsel.
If you are interested in learning more about what DiOrio & Sereni, LLP can offer your small business, please contact Matthew Fry, Esquire at 610-565-5700 or at [email protected].
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