Rockville Business Litigation Lawyer
Rockville Business Litigation Attorney
If you have a business, it is important to work with a Rockville, Maryland business litigation lawyer to set up your business entity to protect yourself from personal liability. Should you be unable to pay your creditors or if someone files a lawsuit against your business, this will help to protect you. In order to be assured of that protection, there are several steps a business must do and continue to practice.
Businesses should form a corporation or a Limited Liability Company (LLC), which will protect you from being personally responsible for business debts. A business law lawyer Rockville MD can help you set up a corporation or LLC. It is important to keep funds from that business separate from your personal funds. If you incorrectly use personal funds for business use or vice versa this is called ‘piercing the corporate veil.’
What are the Consequences of Piercing the Corporate Veil?
If a court rules that your corporation or LLC was guilty of piercing the corporate veil, the shareholders, owners, or members of the LLC or corporation can be personally liable for the debts of the company. Creditors are not limited to the resources of the business but can seek payment from the owners and any of their assets including their bank account, home, investments, and any other assets. It is important to note that the court will only hold those responsible for piercing the corporate veil liable for the debts of the company.
Situations Where Courts Will Pierce the Corporate Veil
- There is not a specific separation between the owners and the company. The court could declare that the LLC or corporation is not a real company if the owners do not keep their personal and business financials totally separate. An owner cannot legally pay personal bills through the business checking account. A court could decide that the business owner has no legal protections that a corporation or LLC offers.
- The company acted fraudulently or wrongly. If the owner borrowed money from the company for non-business reasons or engaged in business dealings where the owner knew they would be unable to pay costs associated with the business deal, or was otherwise dishonest or reckless, the court could revoke any limited liability protection because the owner was guilty of financial fraud.
- The business did not pay its creditors. If a creditor is not paid or if the business has an unpaid judgment against them and they have also committed any of the above infractions, the court may pierce the corporate veil to get the creditors paid.
Commingling Assets
Smaller companies are more guilty of commingling corporate assets with their personal assets. A business should never write a check from the corporation to cover a personal expense. In addition, any checks made out to the corporation must be deposited in the corporate account. If it is deposited in a personal account, that is considered commingling assets and you are guilty of piercing the corporate veil. Talk with a business litigation lawyer Rockville MD to have your assets assessed for any potential fraud.
Business Contracts
There are many types of contracts a business may need to be drawn up, including:
- Purchase agreements
- Services that will be provided
- Employer employee relationships
- Financial loans
If one party violates the term of the contract, then the other party can file a breach of contract lawsuit in order to obtain restitution and/or damages that the breach has caused their business.
If your company has experienced a breach of contract issue, a business litigation attorney in Rockville MD can evaluate your case to see what legal recourse you may have. An injured party may be able to obtain the following:
- Damages: This is compensation that the injured party can pursue for the act of complete breach of contract. Damages are usually equivalent to the amount the injured party would have received if the at-fault party did not breach the contract. A partial breach can result in partial damages.
- Restitution: Financial compensation for restitution is intended to restore the injured party as they were before the parties entered into the contract. Restitution is used to replace property or funds the injured party gave to the at-fault party per the terms of the contract.
- Specific Performance: A business attorney Rockville MD companies trust can also pursue specific performance on behalf of the injured party. This is when the court orders the at-fault party to fulfill their obligations under the terms of the breached contract.
- Recession: Another option is to terminate the contract completely. This is referred to as a recession. Reformation is when the contract is rewritten to repair the harm the injured party was exposed to.
Let a Rockland MD Business Litigation Attorney Help
If you are a business owner, having a skilled business litigation attorney Rockland MD clients recommend is important for protecting your company and ensuring that other parties cannot cause harm. The Law Office of Daniel J. Wright provides the skill and legal expertise to not only draw up iron-clad contracts to protect their clients, but will also fight aggressively to get their clients the best possible remedy should the other party breach any contracts that are in place. Attorney Wright has been advocating for business owners for more than 35 years and has built a solid reputation of diligently protecting his clients and helping them on the road to success. Call our office today to schedule a free and confidential consultation and find out how our legal team can help.
Client Review
“I have worked on several cases with Dan Wright. He is an excellent attorney who truly cares about his clients and doing the next right thing in the practice of law.”
Angela H
