Minutes, Resolutions, and Corporate Books


Owning and running a business is a challenging and time-consuming task, no matter its size. You are constantly being pulled in a number of different directions, have a long list of things to accomplish, and revenue goals to hit. So it should come as no big surprise that maintaining your corporate minutes, having shareholder meetings and updating your corporate books is not on the top of any business owner’s priority list.

Unfortunately, corporate record keeping is a boring task filled with formalities and minutia. It also feels particularly silly when the business is owned by less than three people. But the law requires you to keep it up, and failure to do so can result in a number of nasty surprises.  Like a lawsuit, audit or dispute with your partners or creditors.

man holding noseThe most obvious of these consequences is personal liability attaching to the business owner (failure of the corporate form).  Other problems include suspension of the corporation (and its legal rights and contracts) or liability for fiduciary failures.

Depending on your business needs, you may be required to adjust your corporate books or operating agreement (if you are an LLC), or take certain financial and legal actions, such as opening a bank account or securing financing. You will be required to update everything when you bring on new stockholders as well.

You can buy corporate minutes as forms with fill-in-the-blanks, but such forms are more easily pierced and will not account for your specific business needs. We recommend having your business law attorney put you on an automatic maintenance schedule to keep up your corporate “minute book” and make regular, required filings with the Secretary of State.

A minute book serves as a legal journal, documenting your business’ ongoing corporate activities, decisions, and significant business transactions. It acts as the business’ official repository of all major corporate documents and records. For instance, the minute book should state past and present officers and directors of the business and the dates when they held these positions. The minute book will also outline all of the business’ stock information, including the types and numbers of stocks purchased and sold, the names of the stockholders, and their dates of ownership. Where applicable, the minute book will also note the payment of dividends to shareholders and compensation to management personnel.

Put our Business Savvy Attorneys to Work for your Business

Allowing our business attorneys to handle these tasks, in the long run, is the surest and most cost-effective means of protecting your business from future costly problems.  Bellatrix will provide you and your team with the peace of mind that only comes from 100% asset protection. To sign up for our annual corporate maintenance service, contact us or call (800) 449-8992.  And if you are not sure what state your corporate records are in, consider a Business Risk Review before something blows up.


Partnership Disputes

Settling Partnership Disputes in San Diego, CA

A business partnership is a close, interpersonal relationship that is in no way immune to the usual problems.  Disputes may arise over trust, control or money. When a dispute arises between business partners however, much more than the immediate issues of trust, control, and money is at stake. Left unresolved, a partnership dispute can threaten the very existence of a business—hurting all of those who have worked so hard to make the business thrive — as the partners seek to preserve their own positions. hands in tug of war on ropeIf your business partnership is struggling, consider some of the following ideas to work through the issues.


  • Write down with specificity each partners role and responsibilities. Oftentimes, the break down of a relationship comes from someone’s expectations not being met.
  • Be direct with each other. The unsaid is more damaging than the said.
  • Pick one partner to be the executive. Equal partnerships often cause the partners to come to loggerheads over operational decisions, which is hugely damaging to a business. A business cannot be run day-to-day by committee in most circumstances. Pick someone to be the leader and avoid deadlock.
  • Be clear on the money. Expenses, owner draws and spending authority are all areas that should be negotiated in advance.
  • Map out both short and long term goals so that everyone is on the same page and envisions the business the same way.
  • Consider structuring as a limited partnership. Such legal entities keep the liabilities of one partner from becoming the liabilities of the other partners.
  • Make sure your partnership agreement is thorough and clear on issues of operational and spending authority, draws and exits.
  • Set up the business so that a partner is free to leave at their election without it massively disrupting the business. That way no one is afraid and no one has too much power. Also, when people are staying because they want to be there, rather than because they don’t know how to leave without destroying the business, their attitude and engagement will improve.
  • Consider using a lawyer or a professional mediator to work through issues and then memorialize them in the partnership agreement.
  • If the partnership must break up, use a lawyer to negotiate an amicable buy out or split to avoid litigation.

Sometimes litigation cannot be avoided (particularly if your partner has already sued you). In these cases, the partnership agreement and partnership laws (typically some variance of the Uniform Partnership Act) will govern how the business proceeds or is dissolved. In the event of a lawsuit, you must immediately seek counsel to defend the suit and to maintain operations legally.

If Your Company’s Business Partnership is Struggling, Our Attorneys can Help

If your business partnership is in a state of crisis, contact us to discuss your options. Better yet, ask about the Business Risk Review and address simmering issues before they explode and take the business with it.

Investor and Shareholder Derivative Disputes

San Diego Investor and Shareholder Disputes

Many private businesses seek and obtain investors to get them started or to help them grow. For example, you may have Angel Investors who have given you capital infusions or seed money. Alternately, you may have a “silent partner” investor, or someone who doubles as a financier and business owner, but is not involved in daily operations. As companies grow, venture capitalists may take large stakes in the ownership of the business and dominate the Board of Directors.

While the nature of investments can vary dramatically, all investments share one trait in common: the potential for damaging disputes to arise. When investors and founders of companies disagree on the way a business is being managed, on how the funds are being spent, or on growth or exit strategies, the result can be a contentious, disruptive, and expensive conflict.

If you and your investors are trapped in dispute deadlock which you are unable to resolve internally, it’s time to consider involving an attorney who can help end the conflict effectively and efficiently.  The experienced business lawyers of Bellatrix PC are committed to defending entrepreneurs and companies, and are prepared to engage in aggressive negotiations or defend your organization in court should litigation become necessary.  To start exploring your options in a private legal consultation, call the law offices of Bellatrix PC at (800) 449-8992 today.

business people fighting around conference table

Ways to Prevent and Resolve Investor Disputes

Fortunately, there are many strategies businesses can employ to prevent or resolve investor disputes before they turn into destructive and time-consuming lawsuits.  To provide a few examples, possible solutions may include:

  • Negotiating buyouts and equity redemptions between the company and its investors.
  • Replacing management or an executive who is causing friction, which may also require an executive compensation buyout and release, or a carefully-crafted severance agreement.
  • Involving lawyers at Board meetings for the purpose of negotiating operational agreements, taking minutes, and drafting resolutions memorializing agreements between the company and its investors.
  • Opting for a formal business dissolution, involving an organized “wind down” that includes proper distribution of assets to creditors, investors, and shareholders.
  • Foreclosure of the company by a secured investor.

Of course, none of these solutions are simple “quick fixes,” and you should always consult with an experienced employment attorney who can help you evaluate your options, rights, and responsibilities.  All of the  aforementioned scenarios require formal legal notices, skilled negotiations, and guidance to avoid breach of contract, breach of fiduciary duties, or waste of assets.

Conflict Resolution Strategies: Mediation or Commercial Litigation?

Ideally, all involved parties will want to save the company and figure out a way to work together, or for one party to part amicably.  In this scenario, our qualified mediators can help you and your investors work toward a mutually satisfying resolution.  While mediation is not a realistic conflict resolution method for each and every case, in many instances companies and shareholders favor mediation over litigation where feasible, due to the following advantages:

  • Mediation is generally a much faster (and therefore more cost-effective) process than litigation.  The sooner you can resolve the dispute, the sooner your company can resume unhampered daily operations.
  • While litigation can lead to bitter and contentious disputes, mediation preserves amicable relationships by attempting to grant concessions to both parties.  This can be extremely important if you wish to maintain a long-term professional relationship with an investor.
  • Litigation sometimes generates bad publicity.  Mediation is less “high profile,” and is less likely to attract unwanted attention.

When mediation or other means of alternative dispute resolution fail, commercial litigation tends to follow. For example, disputes can turn into lawsuits where courts involuntarily dissolve the business.  In other cases, the plaintiff may claim breach of fiduciary duties, and involve personal suits against all or many of the Directors of the Board, officers of the company, and even major shareholders.

Disputes can also turn into shareholder derivative suits, which are similar to class actions, even when there aren’t many shareholders.  And unfortunately, depending on who is suing and the policy’s exclusions, the suit may not be covered by Directors and Officers’ Liability Insurance, making the lawsuit financially devastating to all involved.

Contact Our Business Attorneys

It is important to remember that drafting SEC-compliant Private Placement Memorandums and robust financing and equity agreements at the start of a relationship is crucial to avoiding claims of fraud or breach of contract later.  If your documentation has any problematic or ambiguous areas, you may wish to renegotiate and tighten your agreements while relationships are still convivial.

If you are involved in a pending dispute, or simply want to review your investment policies before litigation arises,  Bellatrix PC can help.  Call us at (800) 449-8992 or schedule a Business Risk Review to determine your organization’s vulnerabilities and legal options in a private consultation.

Business Law


Disputes, misunderstandings, and litigation impact the health and longevity of your business. Whether you’re the owner of a sole-proprietorship, a partner in a partnership, a member of a limited liability company, or shareholder in a corporation, it is critical to ensure that your entity’s legal and financial interests are being protected by an aggressive and experienced business law lawyer.

At Bellatrix PC, we pride ourselves on providing our clients with responsive, tactical business solutions.  Through critical analysis of the issues at hand, our legal team has repeatedly achieved favorable outcomes for numerous clients across a diverse range of industries and legal structures.  As a results-oriented firm, we aim to resolve complex disputes as rapidly and efficiently as possible, so that you can resume normal operations with clarity and confidence.

To arrange for a private consultation with the commercial attorneys of Bellatrix PC, call our law offices at (800) 449-8992 today.  The sooner you consult with us, the sooner we can get to work addressing your legal matter.

Experienced Business Law Lawyers

Even outwardly simple business transactions can lead to confusion and uncertainty.  Businesses of all structures are subject to myriad state, federal, and municipal regulations, which collectively encompass matters ranging from workplace discrimination to job site safety to the enforceability of non-compete contracts and other contractual agreements.

Even for highly knowledgeable and experienced entrepreneurs, it can be virtually impossible to keep abreast of the business world’s numerous and ever-shifting laws while busy with the daily demands of running a company.  All too many business owners have been unpleasantly surprised by federal investigations, the imposition of civil penalties, and lawsuits by employees, despite believing they were in full compliance with the law.

At Bellatrix PC, we bring a nuanced practical understanding of the full scope of business law to each and every legal matter we handle.  We will listen to your concerns, advise you with regard to your rights and responsibilities as a business owner, and explain the potential outcomes of the courses you could take on the path toward resolving your issue.

Should litigation arise, we are fully prepared to defend your business all the way to trial if necessary.  However, we are also qualified to function as mediators, to represent your company during arbitration, or simply to act as general counsel for your basic, daily questions and concerns.  We will help you understand the benefits and disadvantages of each available legal strategy as it pertains to your matter, so that you can make an informed decision about what’s right for your company.  When you work with Bellatrix PC, you can feel confident that your business is in capable hands.

Representing Partnerships, Corporations, and LLCs: Cases We Handle

As business owners ourselves, we are personally familiar with the seemingly endless complexities which can arise in business and commercial law.  In order to serve our clients effectively, we handle a wide variety of legal matters throughout every stage of the business life cycle, from formation to sale and dissolution.  No matter which point in its life cycle your company has reached, our dedicated attorneys are prepared to counsel you.

We are equipped to handle the full spectrum of commercial matters, including but not limited to the following:

Breach of Contract

  • Contracts act like blueprints, setting clear expectations for all parties to any business agreement.  When a contract is breached by one or more parties’ improper actions or failure to act, the other party or parties can suffer significant financial harm.

Business Formation and Dissolution

  • Selecting the right legal structure is critical for the long-term success of any business.  Likewise, proper dissolution ensures that debts and assets will be distributed appropriately when the company changes hands or reaches the end of its life.

Commercial Litigation

  • All types of disputes can lead to destructive lawsuits.  Whether your company has been accused of breaching a contract, engaging in discriminatory hiring practices, or other alleged misconduct, our attorneys will vigorously defend your business in court.

Contract Drafting and Negotiation

  • Contracts are the foundation upon which all business transactions are built.  We will prepare, review, revise, and aggressively negotiate your contracts with employees and other businesses, ranging from licensing agreements to commercial leases.

Employment Law

  • Whether your company has been named in a gender discrimination lawsuit, needs assistance determining overtime classification and fair payment of wages, or you simply have questions about drafting an employee handbook, our employment law attorneys are here to help.

Trademarks and Intellectual Property

  • Databases, recipes, software, and related information can be a company’s most valuable assets.  We work to protect your intellectual property and trade secrets with clear and enforceable contracts.

Our other areas of practice include, but are not limited to, the following:

  • Business Insurance
  • Creditors’ Rights and Debt Collection
  • Hiring, Firing, and Layoffs
  • Independent Contractors
  • Leasing Property and Equipment
  • Libel, Slander, and Defamation
  • Mergers and Acquisitions
  • Minimum Wage and Wage Disputes
  • Non-Competes and Non-Disclosure Agreements
  • Non-Profit Organizations
  • Payroll, Salary, and Bonuses
  • Permits and Licensing
  • Sexual Harassment
  • Stock Options
  • Tax Compliance
  • Unfair Competition and Unfair Business Practices
  • Whistleblower Lawsuits
  • Workplace Discrimination
  • Wrongful Termination

Whether you’re thinking about starting a company, need assistance resolving a stubborn dispute, or have already been named by a commercial lawsuit, the attorneys of Bellatrix PC have the skill and knowledge to help your business reach its goals.

To schedule a private appointment, call our law offices at (800) 449-8992 today.

What’s Your Problem?

Maybe We Can Help. Request Your Consultation Today.

Alicia Dearn

Alicia I. Dearn is the founder of Bellatrix PC, a woman-owned law firm with offices in Missouri and California. Bellatrix PC handles lawsuits and business transactions. We advise in business, employment, real estate, intellectual property, civil litigation, and election law.

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The articles published by Bellatrix PC are for informational purposes only and do not constitute legal advice. If you have a legal issue, please get competent advice from a licensed attorney in your jurisdiction. Use of Bellatrix PC's site is subject to our Attorney Advertising Disclaimers.

Incorporating your small business does not always avoid liabilities.

Happy New Year 2015Happy New Year! The beginning of the year is a good time to start some things fresh. If you are like most people, you probably have some lofty goals about losing the holiday weight. And if you are like most business owners, you probably have some goals about improving your business this year (faster, better, stronger, more profitable, more organized, less stressful, etc.).

Goodness knows, starting Thanksgiving, I feverishly review my goals and accomplishments, scramble to accomplish stale tasks, and read motivational books like the 31st of December is the end of days.

And as I consider my year-end profitability, I think about taxes and liabilities (a lot) and consider how I can do things better next year. Because both taxes and liabilities cost me money and take up my time without giving me any return on investment, I want to minimize them as much as possible. Taxes and liabilities are blocks to my business’s growth and success.

If you are a business, the turning over of a new calendar year it is a good time to think about your liabilities, legal documents, tax situation, sunk costs and corporate structures. Let’s start with this: if you are not incorporated but you are doing business (even as a micro-business), you should incorporate immediately. Right now in fact. Here’s our incorporation package: New Business Legal Jump Start.

But even though I recommend you incorporate, you may be surprised to learn that you can still be liable for torts, employment law actions, and debts as the owner of a closely-held corporation or LLC (meaning you have less than 35 owners). When I tell my clients this, they usually argue with me.

 “But I keep all the bank accounts separate!”

“But I thought that was the whole point of incorporating!”

“Why bother to incorporate at all???”

 Unfortunately, the law is complicated and fickle. But that does not mean you should not take advantage of the corporate form. You just need to understand its limitations. Please let me explain.

First of all, you should incorporate so that you pay less taxes. Jeff Cane at Expert Accounting (and someone with whom I’ve worked since 2010) recently shared a PDF with me (Sole Prop vs S Corp). He broke down the tax savings of an S Corporation over a Sole Proprietorship in a hypothetical microbusiness. The tax liability was reduced by thousands of dollars.

But you should also incorporate to avoid liability. And this is where people get confused. You see, the point of the corporate veil is to prevent you from being liable as the business owner of the torts and debts of others, including the business, particularly when you have no ability to control them or prevent them. But it does not mean you can act with reckless abandon in the name of the business. Some of that liability still comes through.

You see, a tortfeasor is always personally liable for their own torts even when they commit the tort while at work or in the name of a business. (Translation: you are always personally responsible for the wrongs you personally do.) The business may also be jointly or vicariously liable (i.e. equally and concurrently responsible). And (here’s where it gets tricky) when you own a business, and that business commits a tort, it is possible that, as the owner of the business, you are also considered to have personally committed the wrong based on your own actions in controlling the business (without anyone having to pierce the corporate veil). Let me give several examples.

Let’s say you are a small business. You bake and deliver cakes. You have only a couple of employees. You have a cake to deliver one day and you do it yourself. While driving the cake, your run a red light and hit another car. Even though you were delivering for the business, you are also personally responsible for the accident. The fact that you incorporated does not relieve you from personal responsibility. But it may make the business equally responsible with you.

In contrast, let’s say you own a bakery and you have 100 employees. One of your employees is delivering a cake, runs a red light and gets into an accident. You do not know that employee well, had no reason to think he would drive negligently that day, have good company training and policies, and did not even know he was going out to deliver that cake. In that situation, the company and the employee are both liable, but not the business owner personally.

And another example: you are the small business cake baker again. You send an employee out to deliver a cake, but know that he’s a terrible driver, it’s snowing, and the delivery is late so it is foreseeable that he will drive hurriedly. In that case, depending on a number of factors, you may be personally liable when he blows through that red light, despite the fact that you incorporated, because you decided to send him out under those conditions.

Similar rules apply to debts (when they are incurred in bad faith or fraudulently, both of which are torts) and certain employment actions (i.e. sexual harassment, which is sort of like a tort). You may also enter into a separate contract to guarantee a debt (this is common with small businesses), which makes you personally liable for the business’s financial burdens even you otherwise would not be.

Some of this makes sense to me — you shouldn’t be able to commit fraud and then hide behind your corporation. But with respect to negligence and certain torts like trespass and conversion, I feel like they create an unfair burden on small businesses that does not exist against big businesses. Sometimes, if you are a small shop (like most businesses are), being incorporated may do you no good if you get personally sued for certain torts. Indeed, I recently defended a very ugly lawsuit where the owner of a business was personally on the hook for a business conversion because a security lien had not been perfected before a repossession. One paperwork error can devastate a small business owner!

But that being said, it is still worth incorporating to protect against liability. Why? Because of all the things it does protect you against. For example, most wrongful termination claims are still only against the company and not the owner. Most wage claims are charged against the corporation and not the owner. Most debts are charged against the corporation and not the owner. And there is even some coverage for torts. Plus, there are a lot of lawyers who do not know that torts may carry direct liability and so they try for alter ego instead (something I can usually win in defense). So perhaps incorporating is a little like taking shelter in a house with a leaky roof; that’s far better than no shelter at all!

Savvy business owners keep different assets in different buckets (like your business cash in a corporate savings account and your personal residence in your own name or a trust). It is a good idea to split your assets up so that they are sheltered. You work hard to earn your money and build your business; “bank” it whenever you can.

Do you know whether your papers, titles, contracts, corporate records and potential business liabilities are in order? Don’t wait until you get a tax bill or get sued to find out that a paperwork error can bankrupt you. Get a Business Risk Review and find out or contact our business law attorneys for a consultation at (800) 449-8992.

Commercial Litigation


Business litigation is a complex area of law often made even more complicated by complex chains of events and factual scenarios. Given this, business law can be difficult to nearly impossible to fully master, understand, and manage on your own.  At Bellatrix PC, we represent and act as your Peace of Mind Advocates. Our commercial practice is structured so as to be responsive not only to the needs of large corporations, but also emerging start-ups and businesses everywhere in between in a vast array of industries.

Stand out from the crowd

Our legal team will listen to your concerns first prior to utilizing their years of experience and legal knowledge to help protect your interests. Whether you case is relatively straight-forward or a complex commercial matter, we will remain committed to aggressively pursuing legal solutions that are a fit for your business and its circumstances.

We work hand-in-hand with your existing business structure

Our legal team at Bellatrix PC is focused on providing the type of services that one would ordinary only expect from in-house counsel. We can recommend viable means for your management team to interface with our lawyers. When you work with Bellatrix PC you can always expect:

  • Steady legal guidance – In an uncertain and changing world, Bellatrix PC can be your business’ guiding legal star. A Bellatrix attorney can always handle your day-to-day legal concerns.
  • Clear communication – Our attorneys are dedicated to developing a strong relationship with each of our clients. We are dedicated to providing answers to your legal questions in a timely manner. If we are unable to take a call, we always strive to return in as quickly as possible.
  • Value for your legal dollar – A difficult economic climate has caused companies to cut-back and restructure their operations. Our firm is mindful of these economic pressures and the need to justify expenses. Therefore we always strive to provide real value for your legal expenditures.

Our attorneys are dedicated to fighting for your business. As an entrepreneurial business itself, Bellatrix PC empathizes and understands the current concerns and barriers growing businesses face in today’s economical climate. It is our deep personal desire for excellence that drives us to provide the most cost-efficient and in-depth legal services to each business we represent.

Providing Peace of Mind in Litigation

We understand that litigating a matter is rarely the preferred choice for any company.  Litigation can be expensive and time consuming. Therefore, we always explore all options that are likely to result in a favorable outcome for our clients whether by formal settlement, mediation or arbitration. However a settlement or form of alternative dispute resolution (ADR) is not always an appropriate or favorable means of resolving a dispute. In light of this reality, our attorneys always prepare thoroughly with the prospect or a trial in their mind. We handle a broad array of commercial litigation areas not limited to:

  • Breach of contract
  • Business succession
  • Business torts
  • Class action lawsuits
  • Closely held business planning disputes
  • Corporate takeovers
  • Corporate acquisitions
  • Corporate mergers
  • Contract disputes
  • Consumer fraud claims
  • Employment disputes
  • Insurance defense
  • Professional malpractice
  • Shareholder Actions

At Bellatrix PC, we assist our clients in navigating today’s legal challenges and regulatory compliance. At Bellatrix PC, we pride ourselves in our dedication and professionalism in all of our legal endeavors. To schedule your company’s free and confidential consultation with a Bellatrix PC commercial litigation attorney call (800) 449-8992 or contact our firm online.