Details giveth and missing details taketh away.

:: Of course, as you read through any contract (a bill of sale for a car, a promissory note for a house, an employment agreement before starting a job), you are already scanning each sentence like a hawk.

Where is the “gotcha” provision the other party is trying to pull over on you?

The major terms and definitions check out. Your name is correctly spelled. The payment and pricing provisions match the deal. You have also read through the obscure paragraphs written in “very lawyerly words”  about indemnities, breaches of the contract, and arbitration, and even your trusted friend’s second opinion says it looks ok. 

But contracts, like a painting, are about the details you see … and about the details you don’t see. Especially if they were intentionally left out. Ask, “what is missing?”

Think about what can go wrong with the deal and see if those situations are covered. What extremely obvious scenarios and arrangements should be talked about but are not? If experienced business executives can miss important details without the help of their in-house counsel, anyone can get tricked by important particulars purposefully left out or incomplete. 

Ensure that no rock is left unturned. Then sign on the dotted line. 

#contracts #allinthedetails #readandreadagain

The trick is to ride and make it to the bell.

:: To learn how to stay on a bronco until the 8 second bell, you have to first learn how to stay on for one. Then 2 seconds. Then 4.

The never-die attitude of a small business owner says, “if I get thrown, I will just dust myself off, and jump right back onto that saddle! Ever tried, ever failed … fail again, fail better!” 

Fail catastrophically, however, and your entrepreneurial rodeo ends for good. 

If, as a small business owner, you don’t set aside time to learn at least the elementary basics of business taxes, you will never make it to the 8 second bell. 

More likely, you will one day find yourself blindsided by your CPA informing that you owe a whopping $25,000.00 in taxes to Uncle Sam. If you never saw it coming and do not have those funds set aside, your jumping back onto the saddle days are over. 

Learn about business taxes. The rudimentary basics are all you need to semi-intelligently converse and plan with your accountant. YouTube and Google are your best friends today for this. 

No idea where to begin? A good jump-off point might be the IRS’s beginner videos on managing taxes (https://www.irsvideos.gov/virtualworkshop/, or you can just type into your search, “IRS Small Business Tax Workshop videos.”)

You will be vastly ahead of the curve of your competition just by knowing the types of taxes (income vs. self employment vs. sales taxes, etc.), knowing how to set up a working accounting system to track your income and expenses, and by setting aside money monthly or quarterly to pay the taxes you anticipate owing.

The trick is to ride and make it to the bell. Eliminate the possibilities of catastrophic failure and you will make it to the bell.

#businessgrowth #deathandtaxes #planahead #rodeolife

When your LLC looks and acts like you

:: If a judge can’t tell what belongs to your business and what belongs to you, you might have a problem. 

If a judge also can’t tell that you are legally distinct from your LLC, you might have a big problem. 

If a judge also sees your company can’t pay back its debts and has caused others monetary loss, you now have a really big problem. 

To never need to find out how big is really big — run your business like it’s its own person and run it honestly. 

It is true that once you have an LLC up and going, you are generally protected from being personally on the hook if the company runs into trouble. A person suing you and coming after your house, bank accounts, and car should expect to run into a brick wall. 

But an LLC has its limitations. After all, it is right in the name, “Limited.” 

One of the most common ways a court will sweep aside your limited corporate protection (“pierce the corporate veil”) is by determining that your LLC is your alter ego. 

Are your personal and business assets are all in the same accounts? Do you haphazardly ignore corporate formalities, cosign for business loans, put your own property up as collateral, and confuse others as to whether they are doing business with you or your LLC? If so, your LLC is your alter ego and your personal assets are at risk.

Please don’t do these terrible things. Rather, run your business like it’s its own person. Have a business checking account and credit card. Only use them to pay yourself and your employees and for business expenses. Finalize and sign contracts, leases, invoices, and documents in your LLC’s name. 

Above all, run your business (as with all things in life) honestly. The rest always takes care of itself. 

#twoisbetterthanone #businessgrowth #businessformation #LLCs

A bird in the hand

:: Whether to play it safe or to risk it all is not just a cornerstone theme of popular board games. It’s also a real choice you will have to make come settlement time. 

In order to stop you from taking your case to trial, an adversary will often attempt to put serious money on the table (albeit less money than you deserve) as a settlement offer. Even if you were sure you had a slam-dunk case up to this point, second thoughts will inevitably creep in: 

The other side’s lawyer is an absolute assassin renowned for dismantling witnesses on the stand… It is no secret that juries are unpredictable and fickle… Your key expert has such poor articulation skills, they will almost certainly frustrate everyone in the court room…

However, before psyching yourself into an early exit settlement, remember the 2 big things. 

First, trial is a race for credibility and trust. 

Do you have the winning case? Then build and present one that creates the impression that you, not your opponent, are the party representing honesty and integrity. Judges and juries perceive as most trustworthy the side that advocates honestly and presents their case with utmost credibility.

Which brings us to the second big thing to remember. The trusted side (the trusted lawyer) always wins. 

#litigation #casebuilding #presentation

Not all wins are the same.

:: Just because there is a clear path to victory, doesn’t mean you should blindly rush to travel it. 

Crushing an adversary in litigation? Priceless, maybe. But that pricelessness will turn hollow fast if, though you win on liability, you are awarded zero damages.

Or suppose you do manage to score a few thousand bucks from your adversary, but the litigation bill arrives and your lawyer’s invoice is 3 times that. Bad day. 

Before beginning an action, you would be wise to assess the likely outcomes and to ask the right questions before plowing ahead: 

Objectively, what do you or your business stand to gain? Does that gain justify the expense to pursue it? Your opponent on the other side—are they even financially capable of paying the judgment you want?

A “W” is a “W” in the National Football League. Not so in a legal fight.

#litigation #beginwiththeendinmind #damages