Thursday, April 9, 2009

Blog Post Cited in Orange County Register Article on Annual Minutes Mailings

This blog's most popular entry, posted in January 2007 but updated continually since, concerning misleading corporate and LLC annual minutes mailings was recently cited in a small business advice column in the Orange County Register:

Old scam reappears in O.C.:
Burbank attorney Jonas Grant gives a good explanation of the law on his California Business Law Blog, based on problems his clients reported to him in 2007. The post has gotten dozens of comments from people who received these solicitations, some from other states.

(One even accuses Grant of sending the letters, thus the red-letter disclaimer at the top of his post. Talk about shooting the messenger.)
By Jan Norman, March 29, 2009

California Sales Tax Rate Increase

Effective April 1, 2009, but unfortunately not an April Fool's Day joke is a 1% rate increase to California's sales tax, for a new total of 8.25%. In addition, certain cities and localities may add an additional surcharge of up to 2.0%, for a grand total not to exceed 10.25%, among the highest sales tax rates in the nation. Los Angeles County's rate is now 9.25%.

More detailed information is provided in this notice issued by California's sales tax authority, the Board of Equalization (CA "BOE").

See also:

California Legislature Plans to Increase Taxes Amid Recession

Wednesday, April 8, 2009

Free Legal Forms Online

Adams Drafting, a blawg of interest primarily to business attorneys, has an interesting post and following discussion regarding the use, misuse, and dangers of free legal forms found on the Internet or elsewhere: With Free Online Forms, You Get What You Pay For. Excerpts:
The problem isn’t a shortage of free legal forms online. Instead, it’s that there’s available online for free a vast and ever-growing supply of contract models, most of them crappy, and separating what’s OK, in terms of language and substance, from what’s not OK is a gruesome task....

I see the problem as being not that the documents are inherently incorrect in themselves - I’m sure the good sites produce very sound documents - but that they are drafted in the abstract. If a person pulls a document from any standard database - whether one of these sites or their own firm’s standards - it will be blind luck if it actually works for the agreement they are trying to draft for without amendment. Then there seem to be three options:

(i) The document as just used as-is - the document is unlikely to fit the deal.
(ii) A non-lawyer makes some changes. The problem here is the risk of unintended legal consequences of a change.
(iii) A lawyer reviews it. Clearly the issue here is cost.

I suppose people just need to balance those factors, but for any deal worth anything significant, it is likely to be worth having a lawyer have a look, at which point it is more cost-effective for them to use their own standards.
See also Factual Error Found On the Internet, The Onion, 2002.