My Company Has Been Sued By A Supplier Alleging A Breach Of Contract. What Should I Do?
If you are a corporation or any kind of a business entity, you need to have an attorney respond to a complaint. In Florida, corporations are not allowed to represent themselves. An attorney has to answer the complaint and file affirmative defenses, perhaps filing a counter-complaint or a cross-complaint, if a third party is to be brought in. Have the attorney file those documents to make sure that the company does not have a default judgment entered against it. A default judgment means that as long as the plaintiff presents some proof in the case, there will be no defense by the defendant because they failed to answer in a timely manner. In the state of Florida, you have 20 days in which to file your answer and affirmative defenses, or a motion to dismiss.
My Small Startup Company Significantly Expanded and We Are Having Disagreements. Should I Contact An Attorney?
Hopefully, any startup company has had their attorney draft a partnership agreement, whether it is a limited or general partnership agreement, a corporation, or an NLC. Certainly, there are scenarios where people will be sole practitioners and they don’t have the necessity to form those business entities. They have tax consequences for that and they will have exposure to liability.
If it hasn’t been done, you can go ahead and file those articles of incorporations or articles of organizations in the state of Florida and then forget about it until next year. These agreements should state what happens if there are disagreements in the business. There are buy outlaws or right of first refusal for selling stock and for selling interest membership in an LLC. These are the kind of things that should have been handled from the beginning so that if there arises a problem, there is a guide that the parties can use to settle disagreements.
There should be a partnership agreement that spells out what the interest would be and what happens if there are disagreements. Those all can be fixed by negotiations or sometimes, in litigation. Obviously, each side should have their own independent counsel, who try to work through the court system to get a resolution. The more prepared you are in the beginning, the better off you are. Most businesses are started on a shoestring budget but not going through this process with an attorney and getting everything done means that if you get into a disagreement and you have to appear in court, you have spent hundreds of thousands of dollars.
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