It seems that embezzlement is a common news item these days. Every week or so, a news item appears in the Watertown Daily Times concerning a wrongdoer who has embezzled from an employer or organization. The type of embezzlement is as different as the creativity of the wrongdoer. We will focus on wrongdoers who use their organization’s checking account to further their scheme. The wrongdoers could work for their employer or be volunteers of a nonprofit agency or any other organization. [Read more...]
Many state and local agencies tout what a great place New York is to start a small business. That may be true, but on closer examination of their advertising brochures, one small but important piece of the information is probably left out. The key information is Section 630 of New York Business Corporation Law. This section makes the top 10 shareholders of a corporation personally liable for the unpaid wages of the corporation. New York may be the only state in the country that has such a provision. The purpose of the statute is to protect the unpaid employees from being without a legal recourse for past-due salaries and benefits of an insolvent corporation. [Read more...]
So your business is expanding and you are selling goods or services beyond Jefferson County or even New York State. Suddenly you receive a letter from a large New York City law firm stating that the name or symbol associated with your goods or services infringes with another business’s trademark. Once your business expands and sells goods or services beyond Jefferson County, the more likely you are to run the risk of infringing on someone’s trademark.
Rather than owning real property as a place to conduct your business, perhaps leasing space is a better option. It is often said that real estate ownership is location, location, location; the same can be said about commercial lease property. There are many considerations and options that a business owner should evaluate when negotiating a commercial lease. New York courts do not offer the commercial tenant the same types of protection that are afforded to a residential tenant, since the courts view the commercial landlord and commercial tenant as economic equals. Consequently, a commercial lease agreement has more legal terminology than a residential lease. It is inevitable that a small business owner will see the legal terms of “lessor” and “lessee.” A lessor is the landlord and a lessee is the tenant.
Many times a small business owner does not pursue a bounced check or customer’s failure to pay an amount due, thinking that it is too expensive. By the time attorney’s fees and court costs are paid, the cost of collecting the debt far exceeds the debt itself. There is another option for a small business owner and that is filing an action in Commercial Claims Court. A Commercial Claims Court is the equivalent of small claims court for businesses. Commercial claims actions are limited up to $3,000, and a lawyer is not necessary. A commercial claims action can only grant a monetary judgment and cannot order or compel the defendant to perform any promise that was made in a contract.
On March 9, 2011, the New York State Department of Taxation and Finance changed its policy concerning personal tax liability of minority owners of LLC or limited partnership for unpaid sales tax. Under the prior policy, minority owners could be held personally liable for unpaid sales tax even if they played no role in the business’s operation or had knowledge of the deficiency. This policy often led to harsh results; take, for instance, the case of Joseph P. Santos.
In May 2011, a New York City court ruled that a signor of a company’s check for payment of goods was personally liable on the check when it was returned for insufficient funds. The ruling in B.B. Jewels Inc. v. Newman Enterprises Inc. and Rozeta Newman is consistent with several other courts, which have entertained this issue.
Have you ever wondered what your business is worth? At some point, your business must be sold unless you are planning to give it away. If you are a shareholder of a corporation, a member of a limited liability company or a partner in partnership, there should be a mechanism in the corporate bylaws, operating agreement, or partnership agreement that establishes your ownership value. If not, it is time to think about drafting one.