IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY

Why sole proprietorships and general partnerships offer no protection at all.

A sole proprietorship is a type of business entity which legally has no separate existence from its owner. As such, the limitations on liability enjoyed by corporations, LLCs, and LPs do not apply to sole proprietors. All debts of the business are debts of the owner since he or she retains no partners.


Disclaimer: This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. If you have questions or need specific advice relating to the matters contained herein, please contact Lovaas & Lehtinen, P.C.

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY-TYPES OF PROTECTION

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY

TYPES OF PROTECTION AND THE IMPORTANCE OF A NEVADA BUSINESS LAWYER

Limited Partnerships (LP) (continued)

The limited partners in a LP cannot in any way, control or participate in the management of the partnership. As such, they are only liable up to sums invested by them and cannot withdraw their investments without the consent of the general partners. In this relationship both types of partners benefit from the firm’s profits, capital gains, and investment credits.

LPs can be formed for any type of business but they are very popular in movie-making, oil and gas exploration, real-estate development, and equipment-leasing industries. When a business begins to show taxable profits, limited partnerships generally dissolve and form into LLCs

Disclaimer: This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. If you have questions or need specific advice relating to the matters contained herein, please contact Lovaas & Lehtinen, P.C.

TRIAL AND THE IMPORTANCE OF NEVADA COUNSEL

TRIAL AND THE IMPORTANCE OF LOCAL COUNSEL

After discovery a trial is scheduled and the parties appear before the judge to discuss the merits of their cases. The usual standard of proof in civil litigation cases is the preponderance of the evidence standard. This dictates that a proposition is proved by a preponderance of the evidence if the jury is convinced that it is “more likely than not” that the proposition is true. A party who has the burden of proving a fact by a preponderance of the evidence may not simply rely on the jury’s disbelief of his adversary’s denial of that fact. Instead the party must prove his case.

A substantial majority of cases settle prior to trial, so if trial becomes necessary in your case, we would recommend that you retain a Nevada attorney to represent you in your litigation because trial procedure and client advocacy are extremely complex and necessitate the services of an attorney.


Disclaimer: This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. If you have questions or need specific advice relating to the matters contained herein, please contact Lovaas & Lehtinen, P.C.

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY-TYPES OF PROTECTION

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY

TYPES OF PROTECTION AND THE IMPORTANCE OF A NEVADA BUSINESS LAWYER

Limited Partnerships (LP) (continued)

LPs are attractive because they can provide shares to many individuals without the additional tax liability of a corporation (however, states set limits on this number based on this very reason). Each limited partner makes an investment of funds in the partnership and in return receives a pre-stated share of the profits.

Since limited partners (investors) have no control over the conduct of the partnership they should make sure they have considerable knowledge about the reputation and record of the general partner(s) and the type of business. In fact, state laws require that there be some pre-existing acquaintanceship between the general and limited partners to prevent unprofitable business relations. Having considerable knowledge about the general partner in Nevada is especially important because a general partner does not violate any duty or obligation to his limited partners merely because the general partner’s conduct furthers his own interest. If this type of arrangement seems preferable to you we highly recommend that you contact a Nevada business lawyer for further information to ensure that your rights are protected.



Disclaimer: This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. If you have questions or need specific advice relating to the matters contained herein, please contact Lovaas & Lehtinen, P.C.

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY-TYPES OF PROTECTION

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY

TYPES OF PROTECTION AND THE IMPORTANCE OF A NEVADA BUSINESS LAWYER

Limited Partnership

A limited partnership (LP) is a form of partnership similar to a general partnership (outlined below) except that in addition to one or more general partners, there are one or more limited partners. It is a partnership in which only one partner is required to be a general partner, thus limiting liability. As in general partnerships, a general partner acts as an agent of the business to bind all other partners in contract with third parties made in the ordinary course of the partnership’s business.

However, limited partners are akin to shareholders in a corporation, in that LPs have limited liability, or they are only liable for debts incurred by the firm to the extent of their registered investment and have no management authority (the limited partners do not have inherent agency authority to bind the firm unless they are subsequently held out as agents and so create an agency by estoppel or acts of ratification by the firm create ostensible authority). When forming a limited partnership it is important to contact a Nevada business lawyer to ensure that your rights are protected.


Disclaimer: This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. If you have questions or need specific advice relating to the matters contained herein, please contact Lovaas & Lehtinen, P.C.

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY-TYPES OF PROTECTION

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY

TYPES OF PROTECTION AND THE IMPORTANCE OF YOUR NEVADA BUSINESS LAWYER

Limited Liability Companies (LLC) (continued)

Although significantly advantageous, LLCs still retain shortfalls. First, there is no statutory requirement in Nevada for an operating agreement, which could lead to significant issues among members. Second, investors may be more comfortable investing in a corporation over an LLC, making accrual of financial capital difficult. Third, some creditors may require members of an upstart LLC to personally guarantee the LLC’s loans making them personally liable for the LLC’s debt. Finally, it may be difficult for others to determine who actually has the authority within an LLC to enter into a binding contract given the varied titles of LLC principles (i.e. managers, members, managing members, managing director, chief executive officer, partner, and president).


Disclaimer: This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. If you have questions or need specific advice relating to the matters contained herein, please contact Lovaas & Lehtinen, P.C.

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY-TYPES OF PROTECTION

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY

TYPES OF PROTECTION AND THE IMPORTANCE OF YOUR NEVADA BUSINESS LAWYER

Limited Liability Companies (LLC) (continued)

LLCs are advantageous for numerous reasons. First, an LLC can elect to be taxed as a sole proprietor, partnership, S corporation or C corporation, providing much needed flexibility to different firms. Second, members of an LLC are protected from some or all liability for acts and debts of the LLC. Third, LLCs can “pass-through” taxation, or the firm’s owners pay income tax on the firm’s income and not the firm. Fourth, LLCs in Nevada are treated as entities separate from their members, maintaining perpetual existence. Fifth, membership interests can be separated and assigned, providing the assignee with membership benefits without transferring an actual membership interest. Prior to making any decision regarding the formation of an LLC we highly recommend that you contact a Nevada business lawyer to ensure that your rights are protected and that the entity you choose best suits your business goals.


Disclaimer: This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. If you have questions or need specific advice relating to the matters contained herein, please contact Lovaas & Lehtinen, P.C.

ORDERS AND SANCTIONS FOR DISCOVERY VIOLATIONS

ORDERS AND SANCTIONS FOR DISCOVERY VIOLATIONS

Discovery usually proceeds without court intervention, however there are some cases when intervention becomes necessary. Interventions generally occur when there is either an abuse of the discovery process or failure on the part of a party to produce requested documentation.

Abuse of discovery occurs when one party tries to use discovery as a tool to harass his/her adversary. If this is the case the non-abusive party may object to the discovery requests (by indicating that the discovery requests are not within the scope of discovery) or seek a protective order against the abusive discoveree.

If one party refuses to cooperate in the other’s discovery attempts, the aggrieved party may seek an order compelling discovery. An order compelling discovery may be granted if the opposing party fails to: (1) answer an interrogatory; (2) designate an officer to answer deposition questions (if the party is a corporation); (3) produce documents or allow an inspection; or (4) answer a written or oral deposition question.

A court may also order sanctions or penalties against the party who refuses to comply with legitimate discovery requests. These sanctions can take the form of financial sanctions, dismissal of a claim, contempt, and prevention of the refusing party from making certain claims or defenses. We highly recommend that you contact a local attorney prior to engaging in discovery as the process can be complex and difficult to navigate.


Disclaimer: This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. If you have questions or need specific advice relating to the matters contained herein, please contact Lovaas & Lehtinen, P.C.

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY-TYPES OF PROTECTION

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY

TYPES OF PROTECTION AND THE IMPORTANCE OF YOUR NEVADA BUSINESS LAWYER

Limited Liability Companies (LLC) (continued)

In Nevada, articles of organization must be filed with the Secretary of State to prove the existence of the LLC. These articles must set forth the name of the LLC, the name and address of each of its members, the name and address of one or more of the managers (if any), a statement setting forth the relative rights, powers and duties of each member, or an indication that the relative rights, duties and powers will be set forth in the operating agreement of the company. In general, the operating agreement need not be filed with the Secretary of State. Prior to making any decision regarding the formation of an LLC we highly recommend that you contact a Nevada business lawyer to ensure that your rights are protected and that the entity you choose best suits your business goals.


Disclaimer: This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. If you have questions or need specific advice relating to the matters contained herein, please contact Lovaas & Lehtinen, P.C.

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY-TYPES OF PROTECTION

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY

TYPES OF PROTECTION AND THE IMPORTANCE OF YOUR NEVADA BUSINESS LAWYER

Limited Liability Companies (LLC) (continued)

LLCs may be managed by their members proportionate interests; however, more common agreements provide for a manager or board of managers to oversee the day-to-day operations of the LLC. These managers are elected or appointed by members in the LLC and may also be removed by the very same members if the operating agreement provides such a function. Prior to making any decision regarding the formation of an LLC we highly recommend that you contact a Nevada business lawyer to ensure that your rights are protected and that the entity you choose best suits your business goals.


Disclaimer: This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. If you have questions or need specific advice relating to the matters contained herein, please contact Lovaas & Lehtinen, P.C.

TYPES OF DISCOVERY - REQUESTS FOR PHYSICAL AND MENTAL EXAMINATION

TYPES OF DISCOVERY - REQUESTS FOR PHYSICAL AND MENTAL EXAMINATION

When the mental or physical condition of a party is at issue, the court may order the party to submit to a physical or mental examination by a licensed physician or certified examiner. Unlike all other forms of discovery, this can only be achieved through court order and the party making the discovery motion must show good cause for its application. Moreover, the physical or mental condition of the party must be in controversy; it is not enough that the examination would somehow be relevant.


Disclaimer: This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. If you have questions or need specific advice relating to the matters contained herein, please contact Lovaas & Lehtinen, P.C.

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY-TYPES OF PROTECTION

IMPORTANCE OF ENTITY PROTECTION – LIMITED PERSONAL LIABILITY

TYPES OF PROTECTION AND THE IMPORTANCE OF YOUR NEVADA BUSINESS LAWYER

Limited Liability Companies (LLC)

A limited liability company (LLC) is a legal form of business company that provides limited liability to its owners. It is a combination business entity maintaining certain characteristics of both corporations and partnerships. However, it is often more flexible than a corporation and is an excellent tool for companies with a single owner.

Members of an LLC are the owners of the LLC in the same vein as shareholders are owners of a corporation or partners of a partnership (discussed below). These owners hold a membership interest in the LLC entitling them to a right to receive distributions of the LLC and retain proportionate rights over the LLC based on their membership interests. Prior to making any decision regarding the formation of an LLC we highly recommend that you contact a Nevada business lawyer to ensure that your rights are protected and that the entity you choose best suits your business goals.


Disclaimer: This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. If you have questions or need specific advice relating to the matters contained herein, please contact Lovaas & Lehtinen, P.C.