Tuesday, December 20, 2011

Why Incorporate Your Business?

I spoke with a start up business today that was asking about incorporation and drafting a basic business contract for her customers. Many business owners delay incorporating because they feel that cash flow and capital will increase after the business has been around for awhile. I also started with this same rational before I incorporated my business. From a practical standpoint, I understand the logic. On the other hand, the best time to incorporate your business is from the beginning. The reason is because you are likely the best capitalized at this point. Furthermore, many start up entrepreneurs fail to understand the risks of entrepreneurship. I know that I was one of those entrepreneurs that had a optimistic view, but when loses begin to add up, incorporation is a big concern. The benefit of incorporating a business is the ability to leave the expenses and debt if your business enterprise does not make it.

The second point to my blog today is a simple basic business contract should not costs a ton of money at an attorney's office. I believe that you can find a good attorney at a reasonable price to draft a simple to complex contract. Some entrepreneurs overpay an attorney and an attorney charging $275 per hour does not mean that that attorney is better than a more reasonably priced attorney.

Sean Robertson is an entrepreneur and business attorney in downtown Chicago and Naperville, Illinois. We can be reached at (312)-854-7102 and we assist business owners with incorporations, drafting basic to complex business agreements, and purchase and sale of a business.

Sunday, December 18, 2011

Motion for Default Judgment Against Defendants

A Motion for Default Judgment is a written Motion requesting the Court to do a certain action such as find that a Defendant owes the Plaintiff a sum of money. For example, a Plaintiff, Joe Smith, files a lawsuit against Defendants, ABC, Inc. and John Smith, the owner individually. After a period of time, if the co-Defendants do not file an appearance and/or file an answer or response to the lawsuit, the Plaintiff will file a Motion for Default Judgment.

Simply put, a default judgment is a judgment where the Plaintiffs are granted their request because the Defendant failed to appear or other plead a Defense. In the Circuit Court of Cook County at the Daley Center, I often hear Defendants argue that they were not properly served or they did not know of a lawsuit or judgment.

In order to get a default judgment, the Plaintiff must prove that they properly served and notified the Defendant of the lawsuit. Often times, a Defendant may either forget about the lawsuit or not have the money to defend themselves. The key point is a Defendant should respond to the lawsuit and appropriately defend it.

If you get a default judgment in Cook County or Dupage County entered against you, Robertson Law Group, LLC can assist you vacate the default judgment. Vacating a default judgment prior to thirty (30) days after a default judgment is much easier to accomplish. Courts and judges may freely grant relief against a default judgment entered within 30 days of the default judgment.
A default judgment or otherwise known as a ex-parte default judgement entered and attempted to be vacated after the thirty (30) day period is harder to vacate. However, if you have simply been unserved the lawsuit, you can bring a Motion to Quash Service of Process.

Sean Robertson is Managing Partner of Robertson Law Group, LLC and he has over seven (7) years of legal experience. Sean Robertson graduated from DePaul University College of Law and University of Illinois at Urbana-Champaign. Sean Robertson can assist you with Motions to Vacate Default Judgments and your civil and business litigation legal needs. As an asset protection attorney, we concentrate in helping Defendants especially business owners. We can be reached at (312)-854-7102 or www.RobertsonLawGroup.com (email: sean@robertsonlawgroup.com).

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Asset Protection & Failure

The main point of today's topic "Asset Protection & Failure" is because most business owners and professionals have a sense of false sense of security until a lawsuit or judgment faces them. At this point, they realize that their foundation was improper for a long time but they did not make asset protection and lawsuit protection an important priority.

In many cases, I see entrepreneurs that have failed significantly and pay a terrible price for their failure. Precisely their failure was a misunderstanding of how important business and personal asset preservation is to a business owner or professionals' financial well-being.

What is this failure and the consequences?

This failure is bankruptcy, keeping business debt that should have been kept in the past by incorporating a new business. Simply put, the failure was failing to understand the proper corporate and legal formalities such as incorporating their business but keeping themselves as the only owner of their business. Instead a better solution is to make an s corporation owner of an Corporation or an LLC. This way in case of a business failure, you can dissolve that business and isolate those business debts to that failed business venture. Furthermore, every business owner and professional must have a protection plan that protects their house or properties from liens, lawsuits, and judgments.

When you own a business, whether you are a passive or active investor, lawsuits are inevitable. The biggest mistake is partnership or business disputes. Each partner may be personally liable for a big debt that is not dischargable in a bankruptcy proceeding.

In conclusion, you do not have to learn failure and your mistake the hard way. Make asset protection important by educating yourself on what is asset protection. Second, you should always have a protection plan against personal guarantees and an exit strategy in case your business fails.

Sean Robertson is a business and asset protection attorney in downtown Chicago assisting entrepreneurs and professionals with asset protection and business litigation surrounding personal guarantees, partnership and business disputes, and representation when a business owner has a judgment or is expecting a judgment against them. Sean can be reached at (312)-854-7102 and our website is www.RobertsonLawGroup.com.

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Thursday, December 15, 2011

Motion to Vacate Default Judgment Under 2-1301

In Illinois, a default judgment is entered when a person or entity does not show up for court. There are two (2) rules in the Circuit Court of Cook County or Illinois regarding default judgments. The first one is governed by 2-1301, which essentially says that a Judge should liberally vacate a default judgment as long as a petition to vacate a default judgment has been filed within thirty (30) days of the entry of a default judgment. The second standard is a more difficult standard, which is when a motion to vacate default judgment has been filed after 30 days from the entry of a default judgment.

For example, this morning my client had a hearing on a 2-1301 motion. At issue was whether our client filed a motion to vacate default judgment within thirty days after the entry of a default judgment. In this case, the Defendant had gotten a default judgment entered against her on August 24, 2011. The Attorney General made a mistake when drafting the default judgment order and put that the default judgment was in the amount of $74,000. On September 26, 2011, the Attorney General's Office corrected their mistake and the judgment amount was for $75,000 instead of $74,000 (figures are not exact but the example is still applicable). Our client hired our law firm around October 15, 2011. Thus, even if we would have known that the default judgment was actually entered on August 24, 2011 instead of September 26, 2011, our client still could not have filed a motion to vacate default judgment within thirty days of August 24, 2011.

In the instant matter, the Court ruled that the judgment date was August 24, 2011 and a clerical error occurred instead of a substantive or major error. Thus, our client lost the motion to vacate default judgment because it was not properly filed within thirty (30) days.

In January 2012, we have a hearing date to determine whether 2-1401 is applicable. 2-1401 is when a motion to vacate a default judgment is filed after the expiration of thirty (30) days after the entry of a default judgment. There are three (3) major factors that a court will consider with a properly brought 2-1401 motion to vacate default judgment. The first issue is whether the Defendant has been reasonably diligent in responding in a timely manner to the underline case. Simply put, the court wants to assess how responsible was the Defendant in keeping up with their court case and whether they acted in a reasonably diligent manner after they found out they had a default judgment. The second factor is that the default judgment was not entered in excess of a year from the date of entry of default judgment. The third factor is the Defendant has a meritorious case, which means that the Defendant has a reasonable dispute and a case to defend themselves in the underlying case.

Sean Robertson is managing partner of Robertson Law Group, LLC, which concentrates in civil and commercial litigation and asset protection for business owners and individuals. Sean Robertson deals with a lot of Motion to Vacate Default Judgment issues and go to trial and hearings on these issues. We can be reached at (312)-498-6080 or Sean@RobertsonLawGroup.com.

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Monday, December 5, 2011

Why A Husband and Wife Should Not Own The Same Business?

Why a Husband and Wife Should Not Own The Same Business?
A husband and wife should not own the same business for one (1) major reason: Asset Protection. In today's economy, business owners are filing litigation claims against Defendants and being sued by their vendors and their customers among other people. In many states, a spouse is not responsible for the other spouse's liability concerns. This is not true in community property states such as California. But, in Illinois, a spouse is not liable for their spouse's debts (with some exceptions). Husbands and Wives generally want to each own a equal percentage in the family business. This is a worthy goal, but there are several ways to give husband and wife control without setting up additional liability concerns. First, one spouse could be an employee of the company. If an Limited Liability Corporation (LLC), an LLC can be set up in two major ways. The first way is a member managed LLC, which means that the members or owners run the day to day operations. In this example, each spouse would be an owner or if you follow my recommendation, only one (1) spouse would own your LLC or Corporation. The second way is a manager managed LLC, which is similar to the way a Corporation is structured. Here, the members or owners appoint a manager(s) such as a spouse. In this situation, one spouse could be a member or owner and both spouses could be managers of the LLC. It is generally much harder to prove liability of a manager than a member or owner. Similarly, a corporation is structured where you have shareholders and the shareholders appoint or elect a board of directors. For example, a corporation could be owned by one (1) spouse and appoint both spouses as directors of the corporation....President...Vice President. Again, the benefit of only one spouse owning an LLC or Corporation is if there is business failure or a lawsuit, one spouse is safe from lawsuits. Or, I should say safer from lawsuits. This asset protection type may be the difference between bankruptcy and more importantly, a nightmare. Today, business owners and their creditors are suing one another and many business owners are facing adversarial claims in bankruptcy court, which is threatening their ability to file Chapter 7 bankruptcy. If one spouse is immune from the lawsuits, the other spouse can assume key responsibilities for the family finances.

In conclusion, it is vital that a husband and wife should own the same business. During a divorce, a court of law or divorce attorney can treat the business as a marital asset. A marital asset is an asset that is created during the marriage of a husband and wife. Thus, a husband and wife each technically own fifty (50) percent of marital assets. Therefore, in a divorce scenario, whether one spouse technically owns the Corporation or an LLC will not be a big deal because the business is a marital asset.

Sean Robertson is an asset protection attorney that concentrates in business counseling, asset protection, and estate planning for business owners and individuals. Sean Robertson is Managing Partner of Robertson Law Group, LLC and may be reached at (312)-854-7102. Our website is www.RobertsonLawGroup.com.

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Sunday, December 4, 2011

Medical Bills and Asset Protection

Today a friend of mine asked me about whether you can file bankruptcy on medical bills. Yes, you can but Chapter 7 bankruptcy only makes sense if your assets do not exceed the amount of the medial bills. Often times, if your assets exceed or are close in number to your medical bills, ba baby boomers do not want to risk their retirement to pay their medical bills. In contrasts, Chapter 13 is a way to repaying your debt over time. In this situation, a person re-pays a portion of their debt. I am all for people re-paying their debts, but obviously, when a repayment of your debt concerns your financial future, most people will think long and hard about this. In many cases, repaying a portion or percentage of the medical bills is the best solution. The key point of this blog is the importance of pre-planning an advanced planned asset protection plan before any lawsuits are thought of. Asset protection is vital because it protects your hard earned assets.

Sean Robertson is an asset protection attorney in downtown Chicago, which concentrates in distressed planning, judgment planning, and bankruptcy counseling. Sean Robertson may be reached at (312)-854-7102 and our website is www.RobertsonLawGroup.com.

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Saturday, December 3, 2011

Entrepreneurship and Legal Protection

As a fellow entrepreneur, I understand how the legal decisions affect your business decisions. Often times, entrepreneurs focus on how to grow their business and pay little attention (if any) on how to protect the valuable assets of their business. In today's market, lawsuits and creditors claims are increasing and many entrepreneurs have taken out lines of credit and take significant risks. These risks often times are not covered by insurance or the entrepreneur does not have the capital to ensure the risks.

Asset protection is increasingly becoming important. Many entrepreneurs falsely believe that an Limited Liability Corporation or otherwise known as a "LLC" or S Corporation will protect them from business lawsuits. Unfortunately, many business owners have found out the hard way that their business entity was ill-equipped to protect them against lawsuits and creditor claims.

What do you mean? Simply put, business owners are being sued in their personal and business capacity. All of a sudden their home or investment real estate and personal assets are exposed to their business creditors. Additionally, business owners and entrepreneurs also sign personal guarantees and in difficult and trying times, entrepreneurs breach their agreements.

Sean Robertson is a business and entrepreneurial attorney that concentrates in asset protection, corporate law, and wealth preservation. Sean Robertson is based in Chicago, Illinois and is managing partner of Robertson Law Group, LLC. Robertson Law Group, LLC is an asset protection law firm concentrating in asset protection, business counseling and litigation, and estate planning.

Sean Robertson may be reached at (312)-854-7102. Our website is www.RobertsonLawGroup.com.

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Thursday, December 1, 2011

Commercial Litigation and Asset Protection for Business Owners

This morning, I met with a fellow entrepreneur who has a legal case at the Daley Center in downtown Chicago, Illinois at the Circuit Court of Cook County-1st Law Division. His case stemmed from a real estate company that he used to own. His story is a similar story that business owners are facing everyday. Business owners are being sued by their customers, vendors, and others. Most often, business owners have bought into the illusion of limited liability protection provided by LLCS and Corporations. Unfortunately, most business attorneys do not inform a shareholder or member of an LLC that there is a good chance that they will be sued personally if a lawsuit is commenced. Later on this afternoon, I met with a father and son team that have a successful closely held business. Their objective is to gift the business to the son. In one of the topics, we discussed is it is better to have his company, ABC, Inc. (made up name) to be owned by a new entity, S corporation, instead of him personally. The business purpose behind this is most creditor's attorneys will sue the ABC, Inc. and S corporation and not the client personally. If the Client was a member or shareholder in his personal name, the Client gets named in the lawsuit. This is important for several reasons. The first reason is the costs of paying for litigation can and does bankrupt a lot of business owners. My main point is asset protection and wealth preervation are critical for business owners before a litigation arises.

Sean Robertson is a commercial litigation and wealth preservation attorney that concentrates in litigation, estate planning, and asset protection for business owners. Unlike most litigation attorneys, Sean Robertson focuses on distressed business owners and giving them their legal and financial options.

Sean Robertson is Managing Partner of Robertson Law Group, LLC, which concentrates in asset protection and commercial litigation. Asset protection is a combination of estate planning, business law, litigation, and bankruptcy planning. Robertson Law Group, LLC may be reached at (312)-854-7102 and our website is www.RobertsonLawGroup.com.

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