Posts Tagged ‘Business’

Happy Birthday To Us!

Saturday, July 6th, 2013

I took the Virginia Bar Exam in February of 2008 and found out in April that I had passed.  That meant that my plan to spend the next year studying for the exam had to be revised, and I looked for a job.

I gave myself until July 4th to find a job and nobody wanted to hire me.

So, I decided that instead of just being ready to help other people start their own small businesses, I could hang out my shingle and start a business myself.  I couldn’t really think of a name, so I decided on Kristina Beavers, Attorney at Law as something simple and easy to remember (for me anyway).

Now, 5 years later, I have expanded from just me to a firm of 2 attorneys and between 4 and 5 other employees and interns.  We also helped two other attorneys get started on their careers and helped students and other employees get work experience that allowed them to move on to other careers.

I’m very proud and thankful for everyone that helped keep us going for the past 5 years.  Those that worked in the office, those that supported us, and all of the clients that put their trust in us and that have allowed us to represent them.

I”m also very thankful for my patient and supportive husband who has put up with the long hours and the stress that comes with running a small business.

Guess it’s time to work on the next 5 year plan!

If you would like talk about starting a small business, or if you have any questions about this or any other legal subject, please feel free to give us a call at 757-234-4650 or visit our website at

Do you need a registered agent?

Sunday, December 2nd, 2012

Each organization authorized to do business in Virginia is required to have a registered agent and a registered address.

The registered address of the company must be a physical address where someone may actually come in person to serve legal process if necessary.  An address that is a PO Box will not be sufficient.

The registered address may be the physical location of the company, or it may be a different physical address.  Many people run small businesses out of their home and they may not want to have their home address listed on the public websites that are required to display the registered address and the name of the registered agent of companies.

The registered agent can be an officer or other member of the management of a company.  You may also have an attorney as the registered agent, and many law firms provide this service.

The registered agent’s responsibility is to accept service on behalf of the business and forward any notice, process or demand to the actual management of the company to the last known address of the company.

Most of the time, the notices that are sent will be the notice of annual renewal, and most company owners know when their company ‘birthday’ will arrive.  However, if someone has filed a legal action against the company, there is a relatively short time-frame in which to respond.  That’s why it’s important for the registered agent to know how to contact the owners/managers of the company at all times.

It’s also important for the company to have a registered agent that they can trust to forward any and all notices as soon as they arrive.

For more information, you might look at the Virginia State Corporation Commission website discussion of registered agents here.

If you have any questions about this or any other legal subject, please feel free to give us a call at 757-234-4650 or visit our website at

What are Corporate Bylaws?

Sunday, June 3rd, 2012

I had a client come into the office recently because of a disagreement between himself and the co-owner of the business.  The business was a validly formed corporation so I asked to see the corporate documents.  The client gave me the Articles of Incorporation.  When I asked for the Bylaws, the client said he didn’t know what that was and asked if that was a necessary document.

According to Virginia Code section 13.1-624, the people who start the corporation shall adopt initial bylaws for the corporation.  When you see the word ‘shall’ in the law, that means that it is required.  Unfortunately, the Bylaws are something that isn’t really checked .  The State Corporation Commission only requires an ‘Articles of Incorporation’ document to be filed at the time the corporation is started.  After the initial period, the State Corporation Commission only requires an annual report that will list any changes in the corporate address, or any changes in the names and titles of the corporate officers and directors.  They don’t really ask to see the Bylaws.

What this means from a practical standpoint is that there are many small corporations around that really don’t have bylaws.  As long as things are going along fine, there is no problem.  The problem arises when there is a dispute of any kind about how the corporation should act.  Without the Bylaws, there is no template to tell people what should be done.

Bylaws are the ‘rules’ of the corporation.  Some of the rules are simple, such as the month in which the annual meeting is to take place.

Some of the rules are more complex, such as what happens to the corporate stock when there is a death of one of the stockholders or what happens when the owners of a small corporation can’t agree.

I’ve had business clients tell me that I’m just trying to sell them something and that the corporate owners are best friends and there will never be a problem.  Some of these clients first came to me to handle a divorce action, but they just don’t see the similarity.

My advice regarding Bylaws is to first put in all of the ways things will work when things are going as planned.

Then go into the ‘what ifs’ in life.  What if the other owner gets married and I hate the spouse?  Can the other owner force me to hire to spouse to work with us?  What if I am in a car accident and I’m out of commission for a week?  or a month?  or 3 months?  or a year?  or I’m permanently disabled?  or in a coma?  What if I win the lottery and want to buy the other owner out of the company?  How much will it cost?  What if the other owner gets divorced, will part of the company possibly now belong to that spouse that I hate?…you can go on and on.

You’ll never cover every possible situation, but you can cover the most common types of events.  And the way you cover the common events can be used to interpret how you might have wanted to cover those strange instances.

I like to think of corporate Bylaws like the rule book used by professional golfers.  On most days, nobody has to look at the contents.  But, it’s nice to have when your ball has landed in a spectator’s lap and you need to figure out how to shoot and score the next shot.

If you have any questions about this or any other legal subject, please feel free to give us a call at 757-234-4650 or visit our website at

Someone owes me money, how do I get it? Part 2 – the Trial

Saturday, April 7th, 2012

We have all seen TV shows and movies where there is a trial with the Judge, the attorneys, the jury and the court reporter.  In Virginia, the only required people are the Judge, the person bringing the charges and the person answering the charges.  If the case is being heard in the District Court there is not even a place for a jury to sit, and the parties are often standing right in front of the Judge.

In a criminal trial, the person bringing the charges is either the prosecutor or the police officer.  In other words, the ‘state’.  In a civil trial, the person bringing the charges is called a ‘plaintiff’ and if somebody owes you money, you would be the ‘plaintiff’.

The person who is answering the charges is called the ‘defendant’ whether it is a criminal or civil case.  In our example, that would be the person who owes you the money.

The Judge is the person who makes the decision, and he or she makes that decision based on the facts of the case as they are presented at the trial, and how those facts fit into the existing laws.

In the case of the Warrant in Debt that was discussed in Part 1, you have probably already presented the ‘Bill of Particulars’ which tells the defendant why you think they owe you money, and the defendant has probably already provided the ‘Grounds of Defense’ which tells you why they think they don’t owe you the money.  These documents give the Judge the outline of the case, but you still need to provide evidence so the Judge can make a decision.

The evidence can be documents, things, or testimony of people that have knowledge of the facts of the case.  There are special rules which control what evidence can be admitted for the Judge to review.

Even if you are not an attorney, you are going to be bound by the rules of evidence when you are in a trial.  This is another reason why it is sometimes helpful to have an attorney instead of representing yourself.  The main things to remember are that the evidence needs to be relevant and truthful.

If the evidence is testimony of a person, that person will need to raise his or her right hand and swear or affirm that the testimony they will give is the truth.  If the person gives untruthful testimony while under oath, they can be found guilty of perjury, which is a criminal offense all by itself.

Oral testimony is usually given as a series of questions and answers.  Remember that there is no arguing!  If you think the person is not telling the truth, you can ask another question or ask the same question in a different manner, but you cannot get into a shouting match like you did when you were a kid.

Also, remember that a person can only provide evidence about what he or she saw, heard, or said themselves.  They cannot testify that ‘Susie told me…’ because that is called ‘hearsay’ and the judge can’t use that as evidence when making the decision.

If the evidence is a ‘thing’ you will need to first prove that the ‘thing’ is what you say it is before it can be introduced.  This is called ‘laying the foundation’.  For example, if I wanted to introduce a copy of the contract, I would first ask ‘I’m showing you a document.  Is this the contract that was signed by you and the defendant’?

Each side gets a chance to put forth their evidence and then the Judge will allow each side to make a statement about why they think they should win.  Then the Judge makes the decision.

In Virginia, you have 10 days in which to appeal any decision by a District Court Judge.   If either side notes an appeal, the whole trial will be done over again in the Circuit Court before a different Judge.  You don’t need to present exactly the same evidence at the appeal trial, but a lot of the evidence will be the same.  You might also change your tactic a little based on what the other side did in the District Court trial.

In our example, if the Judge decides that the person does owe you the money, and there was no appeal, you will now have a ‘judgment’.  You won!  But the judgment is really just a piece of paper saying that the other person owes you some money.  You can’t usually take this piece of paper to the gas station or the grocery store to buy things.  Actually getting the money can take some additional steps.

If you have any questions about this or any other legal subject, please feel free to give us a call at 757-234-4650 or visit our website at

My business is an LLC…that means I’m protected…right?

Sunday, July 31st, 2011

I had a client come in recently that had a small construction company that he had set up as an LLC.  That part was fine, and a lot of people use an LLC as a business structure.  This client thought that as long as there was an LLC, all of his personal assets were protected in case there was any legal action against the company.  He had started the company with $100.00 and he had been told that his personal liability would be limited to the amount of his initial investment.

The problem is that even though he had set up the LLC, he did not really treat the LLC as a separate legal entity.  He used the company checking account to pay all of his personal expenses.  Since the income from the LLC flowed through his personal income tax return, that made sense to him.  After all, it was really his money.  So when the house payments were made using checks from the company checking account, it never dawned on him that the house might be considered as belonging to the company and might be attached if someone got a judgement against the company.

He had used an online service to create the LLC and he had filed the ‘Articles of Organization’ just as required.  He had also paid the fees to the service to get the name of his LLC approved and to get a new tax ID for his company (as an aside, you really don’t need to pay for these services).  When he went to the bank to open his checking account, the bank required that he have a business license for the area, so he did that too.  He was all set.  And since the company was his only source of income, he thought it would be easier to just use the one account for all of his banking needs.  That way, he didn’t need to pay any service fees for a different checking account.

He didn’t create an ‘Operating Agreement’ because it wasn’t required by the state and nobody at the internet site told him it might be a good idea.  He didn’t keep track of any changes to how he was managing the company or how he spent the money, because nobody told him he should.

Let’s suppose that one of his customers didn’t like something he had done and the customer sued the company.  The owner thinks his house and cars are safe because they were titled in his personal name and the customer had sued the company. The customer will probably argue that the house and vehicles really belonged to the company because all of the payments had been made by the company directly from the company checking account.  What would happen?

As with most legal situations, the answer is ‘it depends’.  The one thing that we can be sure of is that there will be legal fees to try to sort it all out.

It would be much easier to separate the business assets from the client’s personal assets if the client had created an ‘Operating Agreement’ and established a set amount each month to be paid to himself as a salary which was then put into a separate checking account out of which he paid his personal expenses.  The ‘Operating Agreement’ can also make provisions for the payment of a bonus if there is a month where the income is more than usual.  The ‘Operating Agreement’ might also make provisions for the company use of a personal asset like a truck.

In fact, the ‘Operating Agreement’ can outline a lot of different things that can happen with a company and tells everyone how the company will be managed and operated.  As long as you act according to the terms of the ‘Operating Agreement’, it is much easier to establish whether something is an asset of the company or a personal asset.

I know it seems cheaper to set up your company using an internet service instead of going to an attorney, but you should consider the possibility of future costs as well as the costs today.  Even if all you do is get an initial consultation, what you learn in that consultation might save you a lot more in the long run.

If you have any questions about this or any other legal subject, please feel free to give us a call at 757-234-4650 or visit our website at