Our Business Transactions and Litigation FAQs

You have questions when it comes to the legal issues faced by your business and we have the trustworthy answers you need. Read our FAQs to learn more.

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  • Frequently Asked Questions About Small Claims Court

    What is small claims court?

    What’s the difference between small claims court and county court?

    Can a lawyer represent me in small claims court?

    Who can sue or be sued in small claims court?

    How do I file my claim and how long does it take?

    I’ve been sued, what do I do?

    Can the claim be settled before the hearing?

    How do I prepare for my court date?

    Q: What is small claims court?

    A: Small claims is a division of a municipal or county court designed to provide easy court access to non-lawyers. The cases are heard by a magistrate, who is a lawyer appointed to resolve the dispute. Small claims courts handle cases involving only monetary damages of no more than $3,000.
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    Q: What’s the difference between small claims court and county court?

    A: A county court is similar to a municipal court, but it covers a territorial area. For both county and municipal courts, the court can hear cases which do not exceed $15,000 dollars. In many instances, a county court has a small claims court within it that is presided over by a magistrate.
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    Q: Can a lawyer represent me in small claims court?

    A: Yes, an attorney can represent you in small claims court, but it is not required. In fact, the goal is to make the court accessible to non-lawyers. When you file the complaint and represent yourself in court, you are appearing pro-se.
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    Q: Who can sue or be sued in small claims court?

    A: In general, anyone 18 years or older can sue or be sued in small claims court. A minor under the age of 18 may file a lawsuit through a parent or guardian. Corporations, partnerships, and limited liability companies may be sued in small claims court. You may present evidence concerning your side in a dispute, but you may not engage in advocacy. If you advocate on behalf of an organization, you may violate rules about the unauthorized practice of law.
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    Q: How do I file my claim and how long does it take?

    A: You begin a lawsuit on a small claim by filing a formal statement of claim with the small claims court. Your statement must contain a description of the nature and amount of your claim.
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    Q: I’ve been sued, what do I do?

    A: Remember, if someone has filed a small claim against you, the court will send you official notice. The notice and its attachments will give you important information, such as the name and address of the plaintiff, the basis and the amount of the claim, the name of the court where the claim was filed, and the date & time that you must appear to resolve the claim.

    In many cases, the official notice from the court will also tell you how to respond to the claim, but the nature of your response depends on what you think about the claim that is being made.

    Whether you file a written response or not you must appear at the hearing on the date and time in the official notice.
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    Q: Can the claim be settled before the hearing?

    A: Yes, the claim could be settled before the hearing. For a settlement to occur, the parties must agree upon an amount to settle the claim and notify the court in writing. This is important because your written notice of settlement will be made part of the record and your case will then be dismissed.

    Be advised that the court will not return any fees or other court costs that were paid. So be sure to include that when you consider a settlement amount.
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    Q: How do I prepare for my court date?

    A: It doesn’t matter if you’re the plaintiff or the defendant, your job at the formal hearing (trial) is to give the judge the facts and convince the judge that he or she should decide in your favor. Don’t forget that the hearing is your opportunity to present your claim, defense, and counterclaim. Both sides will have an opportunity to present a case and evidence to support it.

    Before the hearing, collect your evidence, contact your witnesses, and make a written outline of your case. Your evidence may include:

    • Your testimony
    • The testimony of witnesses
    • Written items such as sales receipts, contracts, leases, warranties, promissory notes, IOUs, memos, notes, letters, postal return receipts, unclaimed letter notices, etc.
    • Items relevant to the case – for example, a piece of faulty merchandise on which your claim or defense is based
    • Photos or diagrams, perhaps of the damage to some item or the scene of the incident
    • Anything that can support your case may be useful as evidence

    Be on time to the hearing. You don’t want to lose simply because your case was called and you were not there.
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  • Frequently Asked Questions About Business Law

    What is business law?

    What factors should be considered in choosing the type of business form for my business?

    What is the difference between a subchapter C and S corporation?

    What does it mean to “pierce the corporate veil?”

    What is the difference between a joint venture and a partnership?

    What is a non-profit corporation?

    How often should a corporation hold meetings and update its minutes?

    Is it a good idea to have a Buy-Sell Agreement?

    What does involved in a corporate merger?

    I am planning on starting a business with a business associate, but I am not sure how to set it up. What is the best way to do it?

    My partner and I do not agree on how to run our business. I am considering buying him out. I am not sure what to offer him. How do I buy out my partner without losing everything?

    I think that our best move is to declare bankruptcy. If I do this, does it mean that I won’t owe any more to my vendors?

    I want to set up a Limited Liability Corporation (LLC). Will this protect me more than a sole proprietorship?

    My ex-partner is suing me. Even though his claims are not true, I am worried that I may lose thousands of dollars. What should I do?

    I’ve owned my business for years. What can an attorney do for me that I don’t already know?
     

    Q: What is business law?

    A: Business law encompasses the many rules, statutes, codes, and regulations that are established which govern commercial relationships and provide a legal framework within which business may be conducted and managed. Business law is highly diverse and includes areas, such as:

    • Business formation and organization
      • Transactional business law (contracts)
      • Business planning
      • Business negotiations
      • Mergers and acquisition
      • Divestitures
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    Q: What factors should be considered in choosing the type of business form for my business?

    A: Although there are many important things to think about when choosing a business form, some of the main considerations include your preference of tax treatment, how you intend to capitalize the business, whether you plan to issue stock and trade it publicly, how you intend to structure the management of your business and issues surrounding the liability of the business owners, among other things. It is very important to plan your business and to work closely with someone who can help you choose the business form that will meet your needs.

    How can a properly established business entity, such as a corporation, shield me from personal liability for business debts and obligations?
    Personal liability arising from business obligations can devastate the accumulated wealth of a lifetime of work. Personal liability may extend to business losses, but other obligations may also reach individuals, including:

    • Damage awards in lawsuits
      • Tax penalties
      • Back wages and benefit payments

    Limited liability offered by corporations and other business entities shelters business owners from personal liability. Nonetheless, if an owner or director performs certain personal acts, behaves illegally, or fails to uphold statutory requirements for corporate status, he or she may face personal liability despite the corporate shelter.
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    Q: What is the difference between a subchapter C and S corporation?

    A: The Internal Revenue Code allows for two different levels of corporate tax treatment. Subchapters C and S of the code define the rules for applying corporate taxes. Subchapter C corporations include most large, publicly-held businesses. These corporations face double taxation on their profits if they pay dividends: C corporations file their own tax returns and pay taxes on profits before paying dividends to shareholders, which are subsequently taxed on the shareholders’ individual returns.

    Subchapter S corporations meet certain requirements that allow the business to insulate shareholders from corporate debts but avoid the double taxation imposed by subchapter C. In order to qualify for subchapter S treatment, corporations must meet the following criteria:

    • Must be domestic
      • Must not be affiliated with a larger corporate group
      • Must have no more than one hundred shareholders
      • Must have only one class of stock
      • Must not have any corporate or partnership shareholders
      • Must not have any nonresident alien shareholders.

    Additionally, after a business is incorporated, all shareholders must agree to subchapter S treatment prior to electing that option with the Internal Revenue Service.
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    Q: What does it mean to “pierce the corporate veil?”

    A: Sometimes, courts will allow plaintiffs and creditors to receive compensation from corporate officers, directors, or shareholders for damages rather than limiting recovery to corporate assets. This procedure bypasses the usual corporate immunity for organizational wrongdoing and may be imposed in a variety of situations. The specific criteria for piercing the corporate veil vary somewhat from state to state and may include the following:

    • Courts may not allow owners to benefit from a corporation’s limited liability if the underlying business is indistinguishable from its owners.
      • If a corporation is formed for fraudulent purposes.
      • Courts may impose liability on the individuals controlling the business if a business fails to follow certain corporate formalities in areas such as record-keeping.
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    Q: What is the difference between a joint venture and a partnership?

    A: Joint ventures and partnerships share certain characteristics. A joint venture is a sort of partnership where two or more entities join together for a particular “short-term” purpose. In both partnerships and joint ventures, each partner has equal ability to legally bind the entire entity. A partner can represent the entire organization in the normal course of business and his or her legal actions on behalf of the joint venture or partnership create legal obligations.

    Though the powers of individual partners in a partnership or joint venture can be limited by agreement, such agreements do not bind third parties. Because business contacts outside of the partnership may have no knowledge of the limitations, they may be entitled to rely on the apparent authority of an individual partner as determined by the usual course of dealing or customs in the trade.
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    Q: What is a non-profit corporation?

    A: A non-profit corporation is a corporation formed to carry out a charitable, educational, religious, literary, or scientific purpose. A nonprofit corporation doesn’t pay federal or state income taxes on profits it makes from activities in which it engages to carry out its objectives. This is because the IRS and state tax agencies believe that the benefits the public derives from these organizations’ activities entitle them to a special tax-exempt status.

    The most common federal tax exemption for nonprofits comes from Section 501(c)(3) of the Internal Revenue Code, which is why nonprofits are sometimes called 501(c)(3) corporations.
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    Q: How often should a corporation hold meetings and update its minutes?

    A: Any time a corporation undertakes a major change or transaction, it should be reflected in its minutes. In addition, meetings of shareholders and directors should take place at least annually if for no other reason than to elect new officers and directors. Failure to adhere to the formality of regular meetings can jeopardize the corporation’s ability to shield its officers, directors, and shareholders from personal liability for the corporation’s actions.
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    Q: Is it a good idea to have a Buy-Sell Agreement?

    A: Corporations with more than one shareholder should seriously consider a buy-sell agreement. A shareholder’s death, divorce, disability, or termination of employment can create serious problems for a corporation and its other shareholders. A buy-sell agreement can help minimize these problems by providing for an orderly succession in such plans. Similar provisions are recommended for partnership.
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    Q: What is involved in a corporate merger?

    A: Like most corporate law, mergers are regulated at the state level. While these laws vary by jurisdiction, many aspects of the merger process are the same across the nation. Generally, the board of directors for each entity must initially approve a resolution adopting a plan of merger that specifies the names of the entities involved, the name of the proposed merged company, the manner of converting shares of both entities, and any other legal provisions to which the corporations agree. Each entity notifies all of its shareholders that a meeting will be held to approve the merger. If the proper number of shareholders approves the plan, the directors sign the papers and file them with the state. The secretary of state issues a certificate of merger to authorize the new corporation.

    Each state has its own corporate statutes that govern the procedure for mergers. Furthermore, state or federal agencies may wish to investigate the potential anticompetitive effects of a proposed merger. Because of the requirements and variables involved in merging, a corporation considering a merger should consult a lawyer who is experienced in mergers and acquisitions law.
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    Q: I am planning on starting a business with a business associate, but I am not sure how to set it up. What is the best way to do it?

    A: It depends on the circumstances and the type of business you are starting. It actually is quite important that your business is set up correctly from the beginning. You should contact a Steubenville business law attorney to help you determine the right legal set-up for your business. It could be a sole proprietorship, a partnership or a corporation. Call Littlejohn Law, LLC so we can help you decide the best type of business set-up for your company.
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    Q: My partner and I do not agree on how to run our business. I am considering buying him out. I am not sure what to offer him. How do I buy out my partner without losing everything?

    A: Each case is different. There are several factors involved when buying out a partner. There is how much equity is in the company currently, how much inventory, and what the predicted future income of the company is. It is best when considering ending a partnership to contact Littlejohn Law, LLC to assist you. One can get into real problems with partnerships if the dissolution of the partnership is not done properly with legal counsel. The legal filings must be done correctly. Negotiations on the buy-out are vital. This is the right time for legal advice from Littlejohn Law, LLC. Our attorneys will work to protect you and increase the chances of a reasonable buy-out price from your partner.
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    Q: I think that our best move is to declare bankruptcy. If I do this, does it mean that I won’t owe any more to my vendors?

    A: There is more than one type of bankruptcy. It would be best if you are considering bankruptcy to discuss it with an attorney at Littlejohn Law, LLC. The situation you are facing with your company is individual. Not all kinds of bankruptcy mean that you will not owe your vendors. The bankruptcy court determines what is done to handle all outstanding liabilities of the company. Call an attorney at Littlejohn Law, LLC so we can help you figure out which bankruptcy type is the correct one for your situation.
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    Q: I want to set up a Limited Liability Corporation (LLC). Will this protect me more than a sole proprietorship?

    A: An LLC is similar to a corporation. You are protected by it legally in certain ways. However, the LLC is still liable and needs to have the standard protections such as insurances. It is important that if you set up an LLC it is done properly. You may be taxed either as a corporation or as a partnership, depending on how it is set up. It is recommended that you meet with an attorney from Littlejohn Law, LLC and get legal advice so that your LLC is set up as you envision it, and the legal protection you are seeking is maximized.
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    Q: My ex-partner is suing me. Even though his claims are not true, I am worried that I may lose thousands of dollars. What should I do?

    A: Business litigation is a specific area of the law. In business disputes, it is crucial that you have an attorney that is familiar with business law. It is vital that you immediately contact a business law attorney from Littlejohn Law, LLC to discuss your case. The attorney will work to increase the chances of a good outcome in your dispute and will protect your rights.
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    Q: I’ve owned my business for years. What can an attorney do for me that I don’t already know?

    A: We know that anyone who has started their own business – or even people who are on the cusp of their own business start-up – possess an entrepreneurial spirit, discipline, and great ambition. These are great qualities to have, and in fact, are needed in many business lawyers. So, you may believe that you are qualified to take on your own legal matters, but the truth is, business laws are so complex that we would hate for one complication or one oversight to ruin the business that you have built in a lifetime.

    Every aspect of business law is complicated, and every business is unique. As a result, someone who does not know Ohio’s business laws inside and out cannot utilize these laws to their advantage. So, why choose us? With a knowledgeable and experienced contract attorney, you can end up protecting your business, saving money, planning effectively for the future with a commercial estate plan, and avoiding costly litigation cases like contract disputes or disgruntled employee cases. In addition to protecting your business, an attorney can assist you in other matters as well. If you are contemplating growth or company expansion, we can assist you with business partnerships, business formations, or buying or selling a business.
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    Contact a business law attorney at Littlejohn Law, LLC in Steubenville, OH if you have questions about setting up a business, or need legal protection in a business dispute.