Beware ‘Free’ Legal Advice
The National Federation of Independent Business (NFIB) posted another helpful article. If you own (or intend to start) a small business, the article is a valuable read. Four Pieces of Legal Advice That Sound Good … But Small Business Owners Should Ignore is by Katie Truesdell. In it she interviews experts and outlines advice that the small business owner should be extremely wary of taking at face value.
One of the points of the article (and one that I have frequently written about) is that – when you need a legal document drafted…go to a lawyer. Do not take the document “off the shelf” or from an online source or book. In particular, business contracts must be specifically tailored to the business and the state. (see one of the previous blogs titled, My Bespoke Law Practice on my website.)
Another point from the article is that, if you intend to sign a non-compete agreement (or hire someone who has signed a non compete agreement), it is enforceable! Let’s make a simple example (not used in the article): Ms. Jones joyfully sells her boutique small business to a larger company and signs a non compete agreement, which states that she cannot open another similar business in the area. (This a very simplified example.) Ms. Jones has been told by “people” that the non compete does not really mean anything… the buyer of her small business would not want to try to enforce it, etc. etc. Ms. Jones opens another similar small business. Suddenly she finds herself in the middle of expensive litigation! Why? Because the buyer of her first small business did indeed decide to enforce the non compete agreement! Was the ‘advice’ that Ms. Jones received worth the price of litigation? There are other types of non compete agreements and the statutes vary by state…Remember, they are legal documents and enforceable.
The bottom line…Beware signing any agreement or contract without appropriate legal advice.
To read the entire article, go to the NFIB website, www.nfib.com. According to their website: “NFIB is America’s leading small business association, promoting & protecting the right of our members to own, operate and grow their businesses.” You can sign up to be on their email list for future articles.
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