What Sorts of Business Legal Advice Do Small Businesses Need?

What Sorts of Business Legal Advice Do Small Businesses Need?

Becoming a business owner comes with a lot of responsibility. You have a lot of great ideas and know exactly what your business will offer. Seeking business, legal advice is probably the last thing on most entrepreneurs’ minds.

Their priorities may be out of whack with thoughts of decisions surrounding physical locations or doing an online-only business. Will the business have employees, or is it going to be a one-man or woman show? With the ability to outsource many services, a business owner can save thousands.

As you move closer to opening, marketing comes into play. Getting social media platforms up and running, creating a logo and tagline, and promoting your opening. This list grows daily, and one missed step can throw everything out of whack.

Before getting to this point, there are legal matters that need to be addressed. A wise businessperson will seek legal counsel before moving forward with the decision to start a business. Having the expertise of an attorney will save money and time.

Are you thinking about starting a business? Keep reading to learn more about the types of business legal advice that will be beneficial to all small businesses.

Is Business Legal Advice from an Attorney Necessary?

No one should enter into a business without some form of legal counseling. This is even more important if you’re going into business with other people. There is too much at stack to risk on a handshake.

In fact, if your business will have multiple partners, each person needs to have their own legal representation during the business start-up phase. After everything is in place, the business as a whole can seek legal counsel.

As you will see as you continue to read this article, numerous issues can arise which will require legal paperwork or can lead to lawsuits. Understanding these situations beforehand will save a small business time and money down the road.

Types of Advice You Should Seek

There is a long list of items to cover with a small business attorney. The company has to have legal plans in place, like your business continuity plan. This is a legal document that outlines how your business will run in the face of a natural disaster or government order shutdown.

The business legal advice will help guide you when it comes to who is in charge if the owner is somehow incapacitated. What happens with your company data, who to contact for security breaches, and getting your systems back online?

In the event that is a dispute among the partners in the company or shareholders, how will it be resolved? Can one person buy out another, and at what cost?

Here are other things to consider. Keep in mind this list is not meant to be all-inclusive.

Setting Up Your Corporation

Once you know for a fact, you’re about to plunge into starting a small business, and the state where you reside will need to be contacted. Incorporating a business gives it legitimacy, and with it comes certain perks. You can get a business bank account and qualify for small business loans.

Becoming incorporated is a relatively simple process that can be done online. Before you start the process, figure out if your business will be a Limited Liability Corporation (LLC), which is very common. Or will it be a partnership, S-Corp, C-Corp, non-profit, etc.?

States require an Agent of Record. This can be someone within the company or your attorney. Keep in mind selecting your attorney to be the AOR could come with a fee.

Articles of Incorporation also get submitted. This is the legal structure of the company showing the roles each person will hold.

There are other documents that will have to be completed and filed in relation to the financial structure and tax liabilities. An accountant can best help you understand the tax rules.

Licensing and Certification

Almost every business comes with some form of licensing and permitting. Construction company owners need a contractor’s license. Hairstylists must pass state exams to get a license. Daycare owners not only need to be licensed by the state, but their employees must be certified as well.

Starting a business and not knowing the requirements of the industry will not bode well. Costly mistakes can cost you the business and employees their livelihood.

A small business attorney can help business owners navigate through the state’s licensing and certification requirements. the attorney can also guide you on background checks, and which levels are required based on the clientele you will be serving.


Contracts are another aspect of owning a business. It doesn’t matter if it is a brick-and-mortar location or completely virtual.

A business needs to have its own attorney-approved contracts that cover employment, service providers, landlords, and lease agreements. Any time you give someone a contract and before signing someone else, business legal advice needs to be sought.

In cases where your business leases equipment, there can be many conditions that leave your business liable for damages or overages. A business lawyer can ensure you are not agreeing to terms that would be impossible for you to meet.

A simple word or phrase can mean the difference in how a dispute ends. Being ignorant of what is in a contract rarely holds up in court.


Small business owners need to take a long look at the types of insurance they will need. Business insurance is no different than a homeowner’s insurance policy. it is there to protect you in the event of a loss.

Don’t be confused and think because you’re renting, the property owner has you covered. The business owner is still liable for the property they own. There are business policies to help businesses recover from natural disasters, fires, burglaries, and more.

A business may also need vehicle insurance, workmen’s compensation, and liability insurance. If you are fortunate enough to have employees offering health insurance would be great.

Copyrights, Trademarks, and Patents

Understanding intellectual property is something businesses get into when they are operating under a brand. Your logo and tagline cannot be used by another company. Before naming your business and designing marketing materials, consider getting a trademark.

The website Knowem is a great tool for small businesses to search for the name they want to use. The online app gives returns from website domains to social media platforms and the entire USPTO Trademark Database.

If the product or service you are selling is your own invention, a lawyer can assist with getting a patent.

Privacy Policies

Privacy policies impact every business at every level. In the digital era, websites are required to inform site visitors if they are tracking their digital footprints, also known as cookies.

For eCommerce websites, users need to know how their personal data will be stored, and what the refund policies will be.

Also, privacy policies come into play when you have a website and solicit site visitors to join your mailing list. You cannot turn around and sell the information to a third party.

Small businesses in the medical field have an added burden when it comes to abiding by HIPAA laws. Business legal counsel is an investment well worth its price tag when doing business in the healthcare industry.

Terms and Conditions

Terms and conditions are the rules governing your products, service, website, apps, etc. You’re advising people that if they proceed with doing business with your company, they are agreeing to what is stated.

Just because someone signs off on your terms and conditions doesn’t mean it is legally binding. A small business attorney will go over the document and help clarify your intentions. They will also advise you on whether what you are requiring of people will hold up in court if legally challenged.


Going into business comes with the risk of lawsuits. Retaining a business lawyer will come in handy when some accidentally slip and fall. Restaurants know all too well how easy it is for someone to say they got food poisoning from your place of business.

Any company providing a service is a prime target for a lawsuit is a customer is not completely satisfied. An attorney can go over various scenarios with a new business owner and show them the best resolution practices before an incident reaches the court system.

Other legal issues can come from distributors and industry partners. If someone feels you did not honor your end of an agreement, they can take you to court.


There are places that are considered right-to-work states. This means an employer can fire someone at will. Unfortunately, this does not mean you cannot be sued by a disgruntled employee.

Before hiring employees, seek business legal counsel to go over your personnel documents, including job applications and contracts. Make sure you are abiding by state employment laws.

The business also needs disciplinary guidelines and documents outlining policies on sexual harassment, discrimination, drug testing, and more.


Agreements are similar to contracts as they are legally binding documents. When it comes to agreements, we’re talking more about contracts between employers and employees. They also include contractors and other business partners.

A popular agreement is a non-disclosure agreement. This is where two parties agree not to share the terms of their relationship. Employees agree not to talk badly about the company on social media or to write a book during employment or following their termination.

Non-Compete agreements are used to keep employees from going to work with a competitor within a set period of time.

Dissolution of the Business

No one goes into business thinking they will one day have to close. The truth is the small business administration estimates 627,000 new businesses open every year. By year five, a great percentage will have closed their doors.

The reasons vary from poor planning, partner disputes, and lack of funding, to legal issues.

Closing a business is not always as simple as cleaning out a building and handing the keys over to the landlord. Many of the reasons to seek business legal advice can play a part in dissolving a business.

Having to shut down a business is hard enough. Don’t add to your trauma, the stress of being sued by former employees, distributors, and more. Depending on the amount of debt, a Chapter 11 Bankruptcy could be required.

Should a Lawyer be On Retainer?

Looking at the long list of reasons a small business could require legal counsel, it makes sense to have an attorney on retainer. Some firms charge a one-time retainer fee upfront. Others allow businesses to pay a monthly fee in exchange for having someone available to represent the client when the need arises.

When considering retaining an attorney, seek a firm that covers a wide array of legal issues. Being able to call on the same firm gives you peace of mind. It also means you have someone representing your business that is familiar with you.

Don’t Get Caught Without Legal Representation

Seeking business legal advice from an experienced attorney will give you peace of mind. It will also prepare a business owner for potential hurdles that may come along. It is best to have legal counsel and not need it than to need it and not have it.

Plus, going into business aware of what you can and cannot do, improves your odds of being successful. If starting a real estate agency is on your list of things to do, we hope you found this article useful. Keep checking back for more great trending topics in the real estate industry.


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