When it comes to our health we all know the importance of seeing our doctor for a periodic checkup.  Preventive care and early detection of a potential health risk is critical to an individual’s overall well being.  When it comes to the health of your company, it is equally important to communicate with a business lawyer for a periodic “legal checkup”. 
  As a business owner, it is often hard to think about anything other than day-to-day operations - outstanding accounts receivable, cash flow, and customer service issues - but the failure to periodically check on the legal health of your business can prove fatal.  You should have a professional relationship with an attorney who specializes in representing businesses who can help you identify potential legal problems before they threaten the well being of your company.
  What should you expect a business lawyer to cover during your legal checkup?  Topics should include:
  1.  Legal Structure & Ownership:  Is the business a corporation, limited liability company (LLC) or sole proprietorship?  Which is the best structure for the business?  If there is more than one individual owner of the company, is there a written partnership, shareholders or LLC operating agreement?  If so, is that document current?  It is critical for a business with more than one individual “owner” to have a written agreement governing how the business will be managed and operated.  It should also cover what will happen in the event of death or disability or a dispute between the owners.  What about succession planning?  Is there someone to take over your business when you are ready to walk away from it?  The time to address these matters is now, before a problem arises that has not been properly addressed and legally documented.
  2.  Customer & Client Agreements:  When entering into a contractual relationship with customers or clients, do you document the agreement?  Do you have written agreements, contracts or proposals that you routinely use?  These should be reviewed and updated to protect your business, ensuring they properly include specification of the products or services to be provided, payment, payment terms, termination and default.  In today’s business climate disputes may be unavoidable.  Is your business protected?  Do the agreements contain provisions that permit your business to recover interest, late fees, and attorney’s fees if you have to go to court for collection?  Do your agreements specify how and where disputes will be resolved, such as in court, arbitration or mediation?  What is best for your business? 
  3.  Collecting your Receivables:  Are you having trouble getting paid by your customers or clients?  Do you need to sue someone or are you being sued?  What can you do to address these problems? 
  4.  Employees:  All businesses that have employees should have an up to date employee handbook with written policies and practices that are consistently and fairly enforced.  Personnel files should be maintained as to each employee.  There should be written employment agreements with all key employees, including salespeople and others that deal directly with the company’s customers and clients.  These agreements need to address duties, compensation and termination as well as include confidentiality and non-compete provisions.  If so, these arrangements may be may be treated by the IRS or the State as employment relationships subjecting your business to tax liabilities.  What about employee benefits?  Are you doing what is necessary to attract and keep good employees?  Should you offer a 401K, retirement plan or other benefits?
  5.  Leases and other Contracts:  Do you keep track of the various leases (real estate, motor vehicle and equipment) and contracts entered into on behalf of the business?  When do these contracts expire?  Are there renewal or purchase options with deadlines for exercise? 
  6.  Business & Personal Insurance Needs:  Does your business maintain adequate insurance such as business owner’s (property & casualty), liability, errors & omissions, umbrella, employment practices liability, group health, life and disability?  Have you secured your own disability income and/or life insurance?  What insurance is really needed?
  During your legal checkup, a business lawyer should cover these topics.  An experienced business attorney will also be able to identify and address other important legal issues about which you, being immersed in your business, may not be aware.
  In all economic environments, particularly this one, we all need more clients and customers.  A good on-going relationship with a business lawyer can be one of your most critical strategic alliances.  If you are not “networking” with your business attorney, you are missing a great opportunity to enhance your business.  That said, make sure your lawyer has a firm understanding of your business and the kinds of leads that would be good for your business. 
  Your business lawyer can also serve as a resource for referrals to other professionals and consultants who can help you and your business better achieve its goals.  Attorneys that specialize in business law work with many business clients and their other advisors and often know who does a great job.  He or she can recommend you to any one or more of the following:
  •  Accountants
  •  Financial planners (investments, disability & life insurance, pension plans and 401Ks)
  •  Bankers and Lenders
  •  Estate Planners
  •  Business Coaches and Consultants
  •  Commercial Real Estate Brokers
  •  Telecommunications and Information Technology
  •  Marketing and Websites
  •  Printing and Promotional Items
  •  Office Equipment and Machinery
  •  Business (Property & Casualty) Insurance
  •  Group Health Insurance & Benefits (medical, dental, vision, supplemental benefits and long term care)
  •  Merchant Services and Payroll
  You, as a business owner, will benefit greatly from a legal checkup.  Don’t delay.  Contact a business lawyer today to be sure your legal house is in order and to help your business reach new levels of success!
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Richard B. Charny, Esq. is the managing partner of the Law Offices of Charny, Charny & Karpousis in Mount Laurel, and leads the firm’s Business, Real Estate & Litigation Group.  For over 27 years he has provided on-going business counsel and advice to business owners and professionals. For more information contact Richard Charny at 865-505-1700 or e-mail rcharny@charnylaw.com.