Business and Corporate Law
Texas Business Formation - Which Business Entity Should I Choose?
Gary E. Patterson, P.C. has assisted many clients with their incorporation matters. Whether starting your own business, expanding your commercial presence, or making personal financial plans, it is important to ensure that you limit your personal liability, maximize your tax savings, and create a professional image for your clients, customers, and business associates. The attorneys at The Law Office of Gary E. Patterson, P.C. are available to consult with you about the type of business entity that will best suit your needs.
It’s important to familiarize yourself with a brief overview of each type of entity and their basic benefits and potential problems.
Corporations: Corporations are possibly the most recognized business entity. They consist of a board of directors as the governing body and shareholders as owners. Corporations also have officers who manage the day-to-day operations. If formed and operated properly, corporations provide liability protection to their directors, shareholders, and officers. Corporations also provide a vehicle for providing needed benefits to their owners and employees. By making the proper election pursuant to the Internal Revenue Code (for example, electing ‘C’ corporation or ‘S’ corporation status) you can also maximize your tax savings. Corporations provide many benefits, but they can be cumbersome to operate properly with the meeting minutes requirements and other formalities necessary for this type of entity.
LLCs: Limited liability companies are a more modern business entity recognized by Texas statute. LLCs have managers who make up the governing body of the entity, members as owners, and can also have officers, such as president, secretary, and treasurer. LLCs may also have managing members who act both as the governing body and owners of the company. LLCs provide limited personal liability to their members, managers, and officers, and can act as ‘pass through entities’ for tax purposes (similar to the ‘S’ corporation). This entity is ideal for the company that is owned and governed by a few individuals who are looking to simplify the record-keeping requirements and minimize formalities. However, in some situations, LLCs provide fewer tax benefits to members than corporations.
Partnerships: General partnerships provide no liability protection. All partners in a general partnership share in the assets, income, management, and liabilities of the general partnership. Limited partnerships provide limited liability to limited partners who are generally considered passive investors in the partnership venture. LPs must have a general partner that will be responsible for all partnership liabilities. Limited liability partnerships (LLPs) provide limited liability for certain debts and claims if properly registered with the Texas Secretary of State. Partnerships are governed by partnership agreements that set out the rights and duties of each partner, and the agreements can be highly tailored to meet the business purposes of the partnership.
Sole Proprietorships: Sole proprietorships, also known as d/b/a or assumed names, are not a separate legal entity from their owner. As a result, they provide no limitation of personal liability and little tax benefit. An assumed name is registered with the county or counties where the business will operate.
How Do I Obtain a Default Judgment Against a Business Entity?
In Texas, once a plaintiff has filed a lawsuit against a business entity (corporation, limited liability company, etc.) defendant, the plaintiff will then attempt to serve the registered agent, president or vice president of the business entity defendant. If the registered agent is served, the registered agent should forward the citation and petition to the business entity. However, the secretary of state is an agent for service of process or complaint on a nonresident who: (1) is required by statute to designate or maintain a resident agent or engages in business in this state, but has not designated or maintained a resident agent for service of process; (2) has one or more resident agents for service of process, but two unsuccessful attempts have been made on different business days to serve each agent; or (3) is not required to designate an agent for service in this state, but becomes a nonresident after a cause of action arises in this state but before the cause is matured by suit in a court of competent jurisdiction.
In district and county courts, once a business entity has been served with a citation and petition the business entity must file an answer to the suit by 10:00 am on the first Monday after the expiration of twenty days from the date the registered agent, officer, or secretary of state was served with the citation.
If the defendant does not answer by the date the answer is due, the court may render a default judgment against the defendant. When a defendant does not answer, all allegations of facts in the plaintiff’s petition, except unliquidated damages, are deemed as admitted. This is precisely why it is critical that a registered agent or officer who has been served with citation forward it to the defendant as soon as possible. Otherwise, the defendant risks the possibility of missing the deadline to file an answer. If a default judgment is awarded, the plaintiff can start garnishing accounts of the defendant immediately and can levy and execute once the judgment is final.
The attorneys at The Law Office of Gary E. Patterson, P.C. handle all types of business and commercial litigation disputes. Call our office today for a free consultation at (713) 223-3095.
What is a Covenant Not to Compete?
A covenant not to compete, also known as a non-compete clause or a non-compete agreement, is a business law agreement between an employer and an employee. In a non-compete agreement, an employee makes certain promises to an employer.
Certain businesses have information and clients that are highly desired by competing businesses. It is possible – and it has happened many times before – that an employee could leave the current employer and work for the direct competitor. What prevents the former employee from divulging trade secrets and client information to the new employer? A non-compete agreement is a verbal or written contract preventing the employee from taking these actions.
Under this type of agreement, the employee is stealing information and resources from the former employer. The exact terms of non-compete agreements vary, but generally include: (a) A reasonably restricted geographic location in which the former employee may not work in direct competition, (b) A reasonable time period in which the employee must adhere to the restrictions of the agreement, (c) A description of what the employee is restricted to share or divulge. These restrictions must be reasonable and aim to protect legitimate business interests.
The business law attorneys at Gary E. Patterson, P.C. have the experience necessary to pursue enforcement of your agreement, and will aggressively litigate your case if necessary. If you need legal representation enforcing the terms of a business contract, please contact the experienced business law attorneys of Gary E. Patterson, P.C. at (713)223-3095, to schedule a complimentary consultation.
Probate and Estate Administration
I Was Just Named Independent Executor of Someone’s Will – What Should I do?
You should understand the importance of your job as independent executor of someone’s estate and the duties and powers that follow. You should also consult a qualified probate attorney since an independent executor acts in a fiduciary capacity, and failure to fulfill those obligations may subject the executor to liability. Your attorney will select the correct probate proceeding, file the application and the original will for probate with the county court clerk’s office, appear at the court hearing, and secure a court order admitting the will for probate.
What Are Letters Testamentary and What Do I Need These For?
Gathering information and gaining control of the estate’s assets is an Independent Executor’s first job. Letters Testamentary provide proof that you are the person designated and authorized to act on behalf of the deceased’s estate. You must present Letters Testamentary to individuals or companies holding assets of the estate, so they know you are the representative and that you are entitled to take possession of and transfer assets. Banks, brokerage firms, title and insurance companies are the types of entities that may request Letters Testamentary.
What Should I do when I’m ready to distribute the estate property?
You should ensure that all debts and taxes of the estate are paid. Then, you must review the will carefully distribute the assets according to the will or state law. Again, you should consult with a probate attorney who can assist you with this process.
Our Houston office conveniently serves our clients in Harris, Montgomery, and Fort Bend counties. Call The Law Office of Gary E. Patterson, P.C. today for assistance with all your probate questions.
Gary E. Patterson, P.C. defends people accused of all criminal misdemeanors. A misdemeanor is a criminal offense punishable by time in the county jail and are handled in county courts. You do not lose any civil rights for a misdemeanor conviction. Misdemeanors include simple assault, theft and DWI, first or second offense.
There are 3 classes of Misdemeanors:
Class A Misdemeanors: confinement for term not to exceed 1 year in county jail; and/or maximum of $4,000 fine up; Up to 2 years of deferred adjudication probation or straight probation
Class B Misdemeanors: confinement for term not to exceed 180 days in county jail; and/or maximum $2,000 fine; Up to 2 years of deferred adjudication probation or straight probation
Class C Misdemeanors: No confinement; A fine not to exceed $500 (up to 180 days of deferred disposition)
If you or someone you know has been arrested for a crime, call The Law Office of Gary E. Patterson, P.C. at (713) 223-3095 to have all your legal rights protected.
What do I do if I'm Arrested?
If you are arrested it is important that you contact an attorney as soon as it becomes practicable. The attorneys at Gary E. Patterson, P.C. recommend you keep extensive notes about the circumstances leading up to the arrest, the arrest itself, and the events following the arrest. Giving your attorney a full and complete explanation of what happened will maximize your rights and possible defenses to any criminal charges.
Do I need to talk to police or other law enforcement after I have been arrested?
No. A person who has been accused of a crime has the constitutional right to remain silent and have an attorney present when being questioned by law enforcement. If you or someone you know has been arrested and accused of a crime, call the law office of Gary E. Patterson, P.C. immediately for legal representation.
How much will my Divorce cost?
The cost of a divorce depends on various factors, including: how long the case must be litigated before you and your spouse can reach an agreement on property and child custody, whether temporary orders are necessary, and whether a trial is necessary.
The attorneys at Gary E. Patterson, P.C. handle both contested and uncontested divorces.
How long will it take to finalize my Divorce?
In Texas, there is a minimum requirement of 60 days before a court may grant a divorce. Each case contains unique circumstances and as such, no one can predict the exact amount of time a divorce will take. An important factor to consider is whether you and your spouse can reach agreements on issues pertaining to community property and children.
What is separate property and community property?
In Texas, all property is classified as community or separate property depending on when and how it was acquired.
“Separate property” is property either (1) owned or acquired by a spouse before marriage, or (2) acquired by a spouse during marriage by either (a) gift or (b) inheritance. It is the date of acquisition and the source of the property that controls, not how it is eventually paid for. It is important to note that separate property can change forms without changing its character as separate property.
There is a “community property presumption” in Texas. This means that all property acquired during marriage by either spouse is presumed to be community property, unless otherwise proved to be separate property. A spouse must specifically plead and prove by clear and convincing evidence each item of real or personal property claimed to be his separate property.
Characterizing property as community or separate property can become a very complex process. That’s why its important to know you can have a strong legal advocate like Gary E. Patterson, P.C. on your side.
What is "Common-Law" Marriage?
Texas recognizes common law marriage, also known as an “informal marriage.” There are 2 ways a man and a woman may prove that they are informally married: (1) They can file a Declaration of Informal Marriage (available from the County Clerk’s Office) or (2) They can meet all of the following conditions: (a) the couple agrees to be married, (b) the couple lives together in Texas, and (c) the couple represents themselves to others that they are married to one another.
As with any other marriage, the dissolution of a common law marriage can contain issues of property division, child support, child visitation, and conservatorship. Gary E. Patterson, P.C. is experienced in both traditional and informal marriage dissolutions and is committed to helping you obtain the best possible outcome in your divorce.
What Types of Personal Injury Cases Does Your Firm Handle?
The attorneys at Gary E. Patterson, P.C. provide legal representation in various types of serious injury cases. We can assist you in filing a personal injury claim, workers’ compensation claim, premises liability claim, or wrongful death and survival action claim.
How long do cases take to settle?
Many cases settle fairly quickly when the attorneys at Gary E. Patterson, P.C. file a claim. Others may be contested, or the insurance company involved may try to avoid making a settlement if they fear that others may start filing claims against them. The types of actions taken by corporate defense lawyers can make such cases difficult, and require a trial. Such cases could take longer to settle, but you can be assured that your case, when the attorneys at Gary E. Patterson, P.C. it on, will be constructed carefully, with full documentation and evidence, with the hopes that a trial can be avoided and the settlement recovered in a timely manner. Accepting a low settlement that doesn't truly reflect the damages to our client is not the way we approach our cases. We will seek the maximum possible compensation for our clients.
What is a statute of limitations and does it apply to me?
A statute of limitations is the limited amount of time that one has to file a personal injury claim. Statues of limitations vary from state to state and they apply to personal injury claims, medical malpractice claims and wrongful death cases. If you were injured as a result of someone else's negligence, you should begin the claims process as soon as possible before you lose your right to file a claim permanently, thus resulting in thousands of dollars lost in compensation.
All lawsuits abide by "statute of limitations" guidelines and personal injury cases generally fall into a two-year provision in the state of Texas. Depending on the nature of the situation causing your injuries, a lawsuit must be properly filed with the courts within two years from the date of the incident. Some situations may be categorized under different terms and time constraints may adjust accordingly. Getting a thorough assessment from Gary E. Patterson, P.C. is best done as soon after the incident as possible.
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