Friday, 30 November 2018

Business Loan Workouts

Business Loan Workouts

Businesses (whether they are big, small or medium size) with troubled loans have quite a bit more leverage than they once did. Lenders once were quick to foreclose on non-performing loans; but after years of multi-million-dollar verdicts against them for “lender liability,” they are much more inclined to work with borrowers to see that loans are repaid. For businesses with only temporary or relatively minor financial problems, a loan “workout” or debt restructure is a great option. The key is to negotiate the most favorable new terms without compromising your legal rights.

Contact Your Lender Before They Contact You

The first step of any successful workout is to convince your lender you can ultimately pay off the renegotiated loan. You must show the lender how a workout arrangement is in their best interests. If convinced, a lender may be willing to reduce the interest rate, reduce monthly payment amounts, or change other loan terms.

Many borrowers make the mistake of waiting until their lender starts sending demand letters before suggesting a workout plan. But putting this off until your business is no longer economically salvageable implies that you did not adequately anticipate or prepare for current financial difficulties. In the lender’s eyes, this does not bode well for the company’s future financial viability and offers little incentive to the lender to continue the relationship.





By contacting the lender early, lenders are more likely to go along with a workout plan if non-financial factors are strong within your company. They look at the management team’s honesty, integrity, long-term business planning ability, track record, and competency before making a decision

Pre-Negotiation Preparation

A successful workout begins with thorough preparation. You need to identify problems within your business that may have caused the financial problems and develop solutions prior to approaching the lender..

Present to the lender reliable, professionally-produced analyses and projections in order to prove that you have fully analyzed the financial situation and have addressed any underlying problems that are negatively affecting the performance of the business. The documents should include short-term (three-to-six months) cash flow projections, financial trends and a workable business plan under the proposed new loan terms. Ideas to increase operational efficiency or increase sales should also be included.

Enlist the help of your auditor or accountant to prepare the financial documents needed for the workout package. Loan consultants, many of whom are retired senior bank loan officers, can also help put together the proposal. Make the request for a workout session only when the presentation materials are ready for the lender’s review.

Sometimes There is Lender Liability

If your financial investigation shows that the lender’s actions actually led to the company’s financial problems, you can negotiate a new loan from a stronger position. If the lender sees you have a legitimate “lender liability” claim, your legal counsel can usually persuade even the most inflexible bank to negotiate.

Here are some signs of lender impropriety. The lender:

  1. Tries to control aspects of the business;
  2. Adds new conditions to the loan after the business has accepted the original terms;
  3. Improperly uses acceleration and demand clauses in the loan documentation as a means to ensure compliance or punish the business;
  4. Fails to provide adequate notice before a change in the way it does business with you, or calls a loan due without giving your company time to find a substitute lender; or
  5. Stalls the loan process so an unreasonable amount of time passes and the business suffers as a result.

The presence of one or more of these scenarios could enable you to come to the workout negotiating table without needing to make major concessions. If the lender realizes it is guilty of some kind of misconduct, it will most likely want to make corrections to avoid a possible lawsuit.

Ideally, your attorney should be familiar with lender liability law so you can more readily spot possible lender misconduct while reviewing the history of the loan. You will also need to evaluate the strength of the potential lender liability claim.

Use an Attorney to Workout Negotiations

Be prepared to respond to whatever loan revisions the lender may suggest. Lenders know borrowers are usually in a vulnerable position during workouts, and may try to extract unwarranted concessions. A lender, for example, may insist that any new loan documents include an arbitration clause that waives your right to a jury trial.

Another commonly sought concession is a release by the borrower of any lender liability or other claims, but you must consider the consequences of the decision (i.e., whether to accept new loan terms offered by the bank but forfeit the right to sue for an existing lender liability claim). This decision may depend on your prior review of the strength of the lender liability claim versus the likelihood of turning your business around under the terms offered. Don’t be overly optimistic, and give yourself plenty of time to meet the new terms if you choose to give up your legal claims.

In loan workouts, almost everything is negotiable: loan length, interest rates, payment schedules and technical loan covenants (i.e., debt to equity ratios). You may need an entire set of new loan documents or, if the changes are minor, amendments to existing loan agreements will do. You should be prepared to pay renewal or rollover fees to the lender for changes in the loan terms, and lender’s attorney’s fees incurred in the workout.

It is imperative that all oral promises or commitments made during the workout are documented in writing in the loan papers. Without written documentation, those oral promises may be worthless when you later try to hold the lender to them.

Free Consultation with a Utah Business Lawyer

If you are here, you probably have a business law issue you need help with, call Ascent Law for your free business law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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Thursday, 29 November 2018

Custody and Family Law Change in Utah

Custody and Family Law Change in Utah

Utah Congress – House Bill 35 – does not present a new idea—instead it goes back to “words that influenced our nation’s Founding Fathers.” At least, it does in some Utah’s’ minds, where the state is now “closer to honoring the basic liberty interests upon which our nation was founded,” and the “government is working to strengthen families.” For a patriot and a family (wo)man, what better news could there be than that? Unfortunately for some families, much of the rhetoric used to praise HB 35 is nothing more than a prop, with whatever fallout from the new law that’s left being up to the family law attorney in Utah to sort through.

Because what a family law attorney in Utah does during a divorce is more complicated than reviewing the laws on the books and doling out custody according to what bills have been passed and what statutes are in effect. Every family relationship is different in its dynamics, its strengths and abilities, its troubles, and its resources, not to mention the investment by the parties involved into resolving the familial separation peacefully and functionally. Just because the state of Utah now says that the noncustodial parent gets 40% more time with the child than they had previously, that doesn’t really clear things up in court every time, for every family.

Utah Code 30-3-33 currently states (in part):

“(6) If the custodial parent will be transporting the child, the noncustodial parent shall be at the appointed place at the time the noncustodial parent is to receive the child, and have the child ready to be picked up at the appointed time and place, or have made reasonable alternate arrangements for the custodial parent to pick up the child.

(7) Regular school hours may not be interrupted for a school-age child for the exercise of parent-time by either parent.

(8) The court may make alterations in the parent-time schedule to reasonably accommodate the work schedule of both parents and may increase the parent-time allowed to the noncustodial parent but may not diminish the standardized parent-time provided in Sections 30-3-35 and 30-3-35.5.

(9) The court may make alterations in the parent-time schedule to reasonably accommodate the distance between the parties and the expense of exercising parent-time.”

What Utah’s doing now is trying to even out the scales. By awarding more minimum time to noncustodial parents, the state is emphasizing the role of shared parenting in a family after a couple divorces: the duty and responsibility to raise a child you brought into this world alongside the privilege of sharing the joyful moments in building a relationship with your offspring come hand-in-hand.

This is something that a family attorney in Utah has never forgotten, and when serving clients going through difficult divorces and shared custody agreements, will work tirelessly to represent the interests of the children in presenting arguments for shared or sole custody, as appropriate. But yes, as far as new law reflects the changing values of a society, Utah is on the forefront of telling America and the world that parents shouldn’t do it alone after a divorce, and that one biological sexed parent is not automatically assigned a more privileged status as caretaker.

Free Consultation with Child Custody Lawyer

If you have a question about child custody question or if you need help in a family law case, please call Ascent Law at (801) 676-5506. We will help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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State and Local Tax Law

State and Local Tax Law

If you are thinking about starting a small business, it doesn’t matter where your new business operates, it will need to pay certain state and local taxes, in addition to those required by the federal government. Since tax laws pertaining to small businesses can vary among jurisdictions, it is critical that you check with your state and local government revenue or taxation office to determine the tax obligations of your new business. Keeping this in mind, the following is a general discussion of the typical state and local taxes for small businesses.

State Income Tax

All businesses must pay state income taxes. Some businesses, such as corporations, are taxed as separate entities for income purposes, while the income of other businesses is not taxed separately from the income(s) of their principal owner(s). For example, in most states, a sole proprietorship’s income and expenses are included on the personal income tax return of the sole proprietor. Partnerships and limited liability companies (LLCs) are also often taxed like a sole proprietorship, although LLCs may elect to be taxed like a corporation.

State business income tax is typically a pay-as-you-go tax, meaning businesses usually must pay the tax as income is earned throughout the year. As a business, you may be required to make estimated tax payments during the year. If you are not required to make estimated tax payments, you may pay any tax due when you file your business or individual income tax return at the end of the tax year in April.

To learn more about business income tax obligations, how to pay your business income tax, and other business regulations in your state, you can visit the Internal Revenue Service (IRS) website, which provides links to the state governments of all 50 states.

State Employment Tax

If you intend to hire employees for your new business, you should be aware that employers are required to pay certain employment-related state taxes, in addition to those required by the federal government. Depending on where you operate your business, your state employment tax obligations can include:

  • Withholding a portion of each employee’s wages to pay state income tax on their behalf
  • Payment of unemployment taxes
  • Payment of state workers’ compensation insurance
  • Retention of your business’s payroll and employment tax records for a number of years

Remember also that in addition to payment of state employment taxes, one of the first steps you will need to take when starting a small business is to obtain an Employer Identification Number (EIN) from the IRS. Your business may also need to acquire a similar tax identification number from your state’s department of revenue or taxation.

Local Taxes

Your tax obligations do not end at the federal and state level; you will also likely be subject to local (city or county) taxes as well. The taxes you may need to pay to your local government can include:

  • Property tax
  • Operating tax, which is used by some cities in lieu of a business license
  • Sales tax, if your business is engaged in retail sales
  • Income tax, which is rare but may be imposed on businesses operating in larger cities

As with state taxes, your local taxes will vary depending on the rules of the city and county that your business is operating within.

Free Consultation with a Business Tax Attorney

If you are here, you probably have a business tax law issue you need help with, call Ascent Law for your free tax law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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Wednesday, 28 November 2018

Reproductive Rights

Reproductive Rights

Reproductive rights include such topics as abortion, birth control, sex education, the right to rear children, the freedom to plan a family and other matters related to reproduction. This section includes an explanation of what constitutes the category of reproductive rights, a brief legal history of reproductive rights, relevant case law, and more. See the corresponding sections on abortion, birth control and other reproductive rights topics for more detailed information.

What are Reproductive Rights?

Reproductive rights refer to the rights of an individual to make decisions regarding reproduction and reproductive health. This concept generally includes the right to plan a family, learn about reproduction in school, terminate a pregnancy, access and use contraceptives, and access reproductive health services. Reproductive rights advocates have faced opposition from those raising moral, ethical, and religious issues relating to reproduction. Reproductive rights remain an emotional and politically charged issue.

Abortion is generally the most hotly contested issue within reproductive rights. Defenders and opponents of abortion term themselves “pro-choice” and “pro-life” respectively. Pro-choice advocates argue that an abortion falls within an individual’s constitutional right to privacy. They feel that the choice to terminate an “unborn fetus” lies with the individual and their doctor. Pro-life advocates argue that a fetus is a living being at the moment of conception and argue that abortion should be criminalized for the protection of the “unborn child.”

Laws and History

Much of the legal debate over reproductive rights has centered on abortion. Abortion was a legal practice throughout the United States prior to the country’s independence and continuing until the passage of the Comstock Act in 1873. Although the act primarily targeted pornography, it also made it illegal to use the U.S. Postal Service to send contraceptives, abortifacients, and materials related to sexual education. Around this time states began to pass laws criminalizing abortion. This trend continued until the landmark 1973 Supreme Court ruling Roe v. Wade, which overturned state laws criminalizing abortion.

In more recent years federal lawmakers have restricted federal funding for abortions and some states have restricted access to abortions by requiring parental consent for minors, counseling, waiting periods, and other requirements designed to dissuade individuals from having an abortion. Certain kinds of abortions have been banned altogether, even where this endangers the life of the mother. Legislation has passed that establishes personhood for fetuses. On the other hand, during the same period, the Food and Drug Administration approved the abortion drug RU-486, which aborts pregnancies during the first seven weeks after conception.

Sex Education in Schools

Among the reproductive rights issues that has generated controversy is the question of whether and the extent to which it is appropriate to provide sex education in schools. Advocates of sex education claim that sex education results in lower rates of teen pregnancy and lower STD infection rates. Opponents of sex education in schools claim that the state has no place educating children about sex, preferring that parents teach children about sex in accord with their own values and at the time of their choosing. At present, debate focuses more on the content of sex education rather than whether or not it should be provided. Opponents frequently favor an abstinence-only approach to education, while advocates seek a broader discussion of reproduction.

Free Initial Consultation with a Reproductive Rights Lawyer

When you have questions about reproductive rights in Utah, call Ascent Law for your free consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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Fraudulent Misrepresentation

Fraudulent Misrepresentation

If you operate a company or a business you understand that most transactions and agreements are sealed with a contract, even if it’s just a handshake. We always recommend you have a written agreement. At its core, contract law regulates the transfer of rights from one party to another, holding each party accountable to the agreed-upon terms. It’s of utmost importance in any contract that both parties are on the same page and acting in good faith. But if one party makes a false or misleading statement in order to induce another party into a contract, causing some kind of harm, the aggrieved party may sue for fraudulent misrepresentation.

The following information covers the basics of fraudulent misrepresentation (which differs from breach of contract), including the elements required for liability and remedies.

What is Fraudulent Misrepresentation?

A contract is not considered valid unless all parties are in agreement to the terms. If the expressed terms are not accurate, then any agreement is based on a false premise and the contract is invalid. Knowingly making false statements — whether in writing, verbally, through a simple gesture, or even silence — constitutes false misrepresentation if it has a material effect on the deal.

For example, a drug company working out an acquisition by another company boasts of several “promising” drugs in clinical trials but fails to mention that they likely will not make it to market based on disappointing results. Since the acquiring company assumed these drugs would add value to the deal, it suffered damages by overpaying.

Even if the representation was made without knowledge of whether it was true, it can give rise to a fraudulent misrepresentation claim if it was made in a reckless way. In such instances, the party making the representation is acting recklessly solely to induce the other party into the contract. Using the example above, let’s say the drug company boldly claims it is the only one developing a particular class of pharmaceuticals even though it isn’t positive about this claim. If, in fact, other companies are working on this particular type of drug, the reckless misrepresentation would have a material impact on the deal.

Other types include negligent misrepresentation, in which one party failed to adequately ensure the accuracy of the representation, and innocent representation, which is neither fraudulent nor negligent. Keep in mind that a misrepresentation that does not have a material effect on the contract does not give rise to a legal action.

Elements of Fraudulent Misrepresentation You Have to Prove in Court

In order to prevail in a lawsuit for fraudulent misrepresentation, the plaintiff must be able to prove the following six elements:

  1. A representation was made (in contract law, a representation is any action or conduct that can be turned into a statement of fact).
  2. The representation was false.
  3. The representation, when made, was either known to be false or made recklessly without knowledge of its truth.
  4. The representation was made with the intention that the other party rely on it.
  5. The other party did, in fact, rely on the representation.
  6. The other party suffered damages as a result of relying on the representation.

What are the Remedies for Fraudulent Misrepresentation?

Depending on the nature of the case, remedies for fraudulent misrepresentation can include rescission of the contract and damages. Rescission of the contract is the most common remedy, since fraudulent misrepresentation renders it voidable (as opposed to simply “void”). Therefore, the parties may choose not to rescind the contract — which restores the parties to their pre-contractual positions — if this is not possible. With respect to damages, only actual losses stemming from the misrepresentation may be claimed.

In Utah, loss suffered in reliance on a fraudulent misrepresentation, even if there is not any purchase or sale between the plaintiff and defendant. This situation is presented in a variety of cases: e.g., where the plaintiff is fraudulently induced to extend money or credit, or where the plaintiff is fraudulently induced to purchase or use an article which is inappropriate for the intended use. See Restatement (Second) of Torts § 549, and comments thereto.

 

Free Initial Consultation with a Fraudulent Misrepresentation Lawyer

If someone has committed fraud against you and you need help, call Ascent Law for your free consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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Tuesday, 27 November 2018

Financial Steps in Divorce

Financial Steps in Divorce

As you prepare for a divorce, one issue you should be thinking about is how your finances will change as a result of your new situation. There may be some significant implications to your divorce, and it may take some planning to ensure you remain in good financial health. The following are some tips:

  • Work with a professional: Financial planning can be complicated, and you will likely benefit from the assistance of a financial advisor. These professionals will help you crunch the numbers, develop a budget, get a good sense of your obligations and establish a steady plan for the months and years ahead.
  • Get insurance on your child support: If you are receiving child support payments, it’s a good idea to take out an insurance policy on those payments, especially if there is any question as to whether your spouse will follow through. This will protect you in the event your former spouse misses payments.
  • Be careful with asset division: Just because you have sentimental attachments to some of your property does not mean you should try to get it all in the divorce. Certain pieces of property that are particularly valuable or expensive might put you into an impossible financial situation if you are still making payments on them. This is especially true for family homes and motor vehicles.
  • Consider your tax responsibilities: There may be some new tax implications you need to address after your divorce. Again, consulting a financial advisor may be a good option to make sure you have all your bases covered.

Why You May Want to Hire a Private Investigator in Divorce

In some situations, people who are going through a divorce decide to hire a private investigator to help identify marital assets and property and ensure they are receiving their fair share when it comes dividing this property. However, it’s important to keep in mind that there are limits to what an investigator can do for you, both practically and legally.

What an investigator can do for you

There are numerous ways in which a private investigator can help you during a divorce. The most substantial is in uncovering accounts or records of property you did not know your spouse owned. If you suspect your spouse is hiding a bank account or certain property, you should hire an investigator, as this information can play a major role in the property division process. A failure to disclose assets or attempts to purposefully conceal assets could result in you getting a larger portion of the assets divided.

Good private investigators are typically former detectives or forensic accountants. They should be licensed and experienced in their field.

What an investigator cannot do for you

There are some situations in which the use of a private investigator could cross the line and even be illegal. Investigators are typically not allowed to record phone calls, record video inside homes or spy on spouses in private. Instead, investigators must look at spending habits and review unusual activity in accounts. There are certain tell-tale signs investigators look for to indicate the presence of another bank account.

Free Consultation with Divorce Lawyer

If you have a question about divorce law or if you need to start or defend against a divorce case in Utah call Ascent Law at (801) 676-5506. We will help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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Business Franchise Law

Business Franchise Law

Many of us may refer to a store with multiple locations as part of a “chain” or franchise without really understanding the structure of these kinds of businesses. What is a business franchise? How are they formed, and how do they operate? The following article considers some of the aspects of franchises that make them distinct from other kinds of businesses.

Who Owns the Franchise?

A business may have multiple locations without being a franchise. If the locations all have the same owner, then the business does not meet the definition of a franchise. A business franchise is defined by the structure of its ownership.

Franchising occurs when the owner of a business grants a license to one or more parties for the purpose of conducting business using the same trademarks, trade names, trade dress, and other identifying aspects of the business. The party granting the license is referred to as the “franchisor,” while those purchasing licenses are referred to as the “franchisee.”

The franchisor is frequently involved in specifying the products and services offered by the franchisees. They may also provide a system of operation, marketing tools, raw materials, training, and other forms of support.

Different Types of Franchises

There are two basic kinds of franchise relationships:

  • Product or Trade Name Franchising refers to franchises where the owner holds the right to a name or trademark, which is then sold or licensed to franchisees; or
  • Business Format Franchising refers to franchises where the franchisor and franchisee have an ongoing relationship in which the franchisor provides services such as site selection, training, marketing plans, and other tools for your business.

Individual states may have different business franchise definitions. Some states require a marketing plan or “community of interest” provision in their definition. The Federal Trade Commission (FTC) has its own business franchise definition that will generally apply when:

  • The franchisor licenses the right to use its trade or service marks to the franchisee;
  • These marks are used to identify the franchisee’s business in marketing a product or service using the franchisor’s operating method;
  • The franchisor provides the franchisee with support and maintains some degree over control over the franchisee’s activities; and
  • The franchisee pays the franchisor a fee.

Certainly, every franchise involves a license, though not all licenses are franchises. Whether a business meets the federal or local business franchise definition may affect the kinds of disclosures that are required. However, these definitions do not greatly impact your rights when a disagreement arises since, in either case, a contract is involved.

Contracts for a Franchise

Franchises are built out of contracts between the franchisor and franchisees. As such, there are two places a franchisee can look to determine their rights and responsibilities within the relationship: the language of the contract itself and the relevant jurisdiction’s contracts laws.

The franchise agreement creates many of the most important rights and obligations between the franchisor and franchisee, including the degree of control the franchisor may exercise over the franchisee, terms of operation, training requirements, trademark and copyright obligations, renewal and termination options, and other important details. The jurisdiction’s laws indicate how contracts are interpreted and enforced when the parties have a disagreement.

Free Consultation with a Franchise Lawyer

If you are here, you probably have a franchise issue you need help with, call Ascent Law for your free franchise law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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Monday, 26 November 2018

Enforce Out of State Divorces in Utah

Enforce Out of State Divorces in Utah

If one spouse fulfills the residency requirements of another state, a divorce obtained in that state is valid regardless of where the other party lives. All states will recognize a divorce that was legally obtained anywhere in the United States.

However, there are certain decisions related to the divorce that might not be valid, unless the court had jurisdiction over the spouse who was not a resident. These decisions could include the division of assets and debt, child custody, child support and alimony. Simply showing up to a court date or signing an affidavit of service may constitute consent to jurisdiction, as can following a court’s rulings.

Things to Know in Your Divorce

All states require a spouse to have been a resident of the state before filing for divorce. In most cases, there are some minimums (six months to a year) associated with these residency requirements. In fact, there are only three states — Alaska, South Dakota and Washington — that allow you to file for divorce so long as you are a resident at the time of your filing.

If you suspect your spouse will file for divorce in another state, it might be worthwhile to file first in your home state. If your spouse files first in another state, you will likely rack up significant travel expenses to get to your court appearances. Plus, any modifications that would occur to the agreement would happen in the state where divorce was originally filed.

Can a Spouse Stop a Divorce Filed for Fault?

There is no way for a single spouse to stop a no-fault divorce. However, the state of Utah does allow for fault-based grounds for divorce, in which a spouse can prevent the divorce from proceeding by convincing the court he or she was not actually at fault for the split.

In addition to proving a lack of fault on your part, there are several other options available to prevent a divorce on fault-based grounds. These include the following:

  • Condonation: The defending spouse argues the approving spouse condoned his or her actions. For example, if a wife does not object to known adultery on the part of her husband, the husband could argue that constitutes condonation on the part of the wife.
  • Connivance: Connivance is similar to entrapment. It involves setting up a situation that encourages the other person to commit some sort of wrongdoing. If, for example, a husband invites a suspected lover to the family home and then leaves for the weekend, the wife might argue he connived (set up) her actions.
  • Collusion: In Utah, there are specific length of time requirements for separation before the couple may file for divorce. In this situation, they might pretend one of them was at fault to be able to file a fault-based divorce. This is a form of collusion, as the two people are working together to mislead the court. One spouse could alert the court to this collusion if he or she decides against going through with the divorce.
  • Provocation: If one spouse provokes the other to act in a certain way, and that resulting action forms the basis of the “fault” in question in the divorce, the spouse supposedly at fault could prevent the divorce by arguing he or she would not have acted in such a way without being provoked.

Free Consultation with a Divorce Lawyer

If you have a question about divorce law or if you need to start or defend against a divorce case in Utah call Ascent Law at (801) 676-5506. We will help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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What is Consideration for a Contract?

What is Consideration for a Contract

A legally binding contract needs three main elements: an offer, consideration, and acceptance. While the terms “offer” and “acceptance” are fairly straightforward — an offer is made, and either rejected or accepted — “consideration” refers to something of value that is being gained through the contract. If there is no consideration for one or more parties, then it casts a shadow over the legitimacy of the contract.

In other words, each party should be able to answer the question of why they entered into the agreement. Those who are unable to answer this question may not have been given proper consideration. This article provides a general overview of contractual consideration and how much of it is required for a contract to be valid.

How is Consideration Determined?

Basically, a consideration is determined when the two or more parties to a contract change their positions, such as promising something you are not legally required to do or promosing not to do something you are legally free to pursue. For instance, a company may promise to take down a website that is confusingly similar to your company’s website, which is not legally required to do, in exchange for you dropping your trademark infringement lawsuit against them (which you have a right to do). In this scenario, each side gains something of value — or consideration — from the agreement.

Consideration is Very Important

Generally, the courts will not reform a contract because one party made a bad bargain; but if the contract appears to be entered into under duress, there may be questions about whether there is adequate consideration. Consideration is the value bargained for by the parties, and most decisions indicate there is no reason to inquire into a party’s motivation for giving another party an incredible deal.

Having said that, consideration must meet other requirements. The consideration must be an exchange for the bargain in question; past consideration is no good.

Here is an example to consider.  If Utah Corporation employs Donald under a contract for two years for $100,000. Six months later the president notes that Donald does not seem happy in his job. The president offers Donald $40,000 more to stay for the full term of the contract. At the end of the 2 years, Donald asks for the extra $40,000. There is no enforceable contract for the extra incentive pay. Under the original contract, Donald was already obligated to work for Utah Corporation for a full 2 years. The extra pay is not supported by new consideration; Donald is not giving anything that he did not previously agree to.

Now, if the $40,000 was offered to Donald to take on extra responsibilities or to work Friday nights, or something in addition to what he already contracted to do, and he did it; then, there would be additional consideration that would support the change to the contract.  Does that make sense?

When a Contract Lacks Consideration

The court may, at times, declare that a contract lacks consideration for one or more of the parties involved, rendering it unenforceable. A contract may lack consideration if any of the following is true:

  • The promise cannot legally (or practically) be offered
  • Offer is made for something that already has been done (“past consideration”) and therefore cannot be bargained for
  • One or more of the parties agreed to something he or she already was obligated to do
  • A promise was actually a gift, not something bargained

Free Consultation with a Utah Breach of Contract Lawyer

If you are here, you probably have a breach of contract matter you need help with, call Ascent Law for your free contract law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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Sunday, 25 November 2018

Finding Assets After Divorce

Finding Assets After Divorce

It’s somewhat common for an individual to attempt to conceal assets and money before or during divorce in Utah, thinking they’re shielding them from the asset division process. However, doing this is strictly illegal, and it’s important to be diligent to make sure your former spouse is being completely honest about his or her assets.

There are plenty of tools for discovery at your disposal to help ensure you and your divorce attorney account for all marital assets and property. The following are a few of those tools and methods:

  • Document demands: Your divorce lawyer may send a legal order to your spouse to have him or her produce tax returns, loan applications, account statements and other types of financial records. This will give you a more accurate look at the amount of money with which you’ll be dealing.
  • Inspection demands: Your lawyer may seek permission to inspect safe deposit boxes, safes, locked areas and properties.
  • Questioning in writing: Your attorney may use requests for admission or interrogatories to force your former spouse to answer questions in writing or admit certain specific statements. Your ex-spouse is legally required to be truthful in making these written statements.
  • Testimony under oath: You, your ex-spouse and your attorney would give an oral deposition in front of a court reporter in this scenario. Your spouse is under legal obligation to tell the entire truth when it comes to the questions your lawyer asks. A failure to do so is considered perjury, which is a felony offense.

Advice from Marriage Therapists If You’re Considering Divorce

Many couples who are frustrated with their marriage and are on the verge of divorce decide to give marriage therapy a try. The hope is that they can work out their issues together in a mediated setting and save their relationship. While this does not necessarily work for all couples, it can help rekindle your connection and get past some of the issues that have brought you to the brink of divorce.

The following are some common pieces of advice marriage therapists provide to couples:

  • Conflict presents opportunities: In many cases, conflict can mean there is room for new growth in a relationship. The way a couple responds to these challenges may ultimately improve the strength of the relationship. Having a mediator to help you work through this conflict in a safe setting can help you and your partner get past these particularly challenging conflicts and achieve a new level of trust in each other.
  • Consider why you want to work on the marriage: Perhaps the best way to predict whether or not a relationship will succeed is the desire each party has to make it succeed, regardless of the challenges that pop up. Couples that take the time to work through their issues together are far more likely to have a long-lasting relationship.
  • Saying “me” instead of “we” is okay: When you are working through your emotions together, it’s okay to say “me” instead of “we.” That doesn’t make you selfish — it makes you honest. Instead of saying “we argue a lot,” say “I feel angry/frustrated when you say those sorts of things,” or “I know I contribute to these arguments by always having to have the last word.”
  • If there’s a small part of your marriage worth saving, hold on to it: Sometimes finding even just a small element of a marriage that both spouses truly appreciate can help springboard them into repairing the relationship as a whole.

Free Consultation with Divorce Lawyer in Utah

If you have a question about divorce law or if you need to start or defend against a divorce case in Utah call Ascent Law at (801) 676-5506. We will help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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Retention of Employee Records

Retention of Employee Records

The beginning of a calendar year is a good time for employers to review their document retention status. All employers should establish and maintain a clear record retention policy identifying the location of records, a reasonable schedule of retention and destruction, and a records administrator.

Documents related to employee recruitment and selection, such as job advertisements, resumes, job inquiries and records of refusal to hire should generally be retained for one year. 29 U.S.C. § 626; 29 C.F.R. § 1627.3 (Age Discrimination in Employment Act). Once an employee is hired, EEOC regulations require employers to keep all personnel or employment records for one year. If an employee is involuntarily terminated, his/her personnel records must be retained for one year from the date of termination. 42 U.S.C. §2000e-8(c); 29 C.F.R. §1602.14 (Title VII of the Civil Rights Act of 1964). Separate personnel files should be maintained for each employee.

Employers must maintain pay and promotion records for a period of three years, and must keep all records that would explain the basis for employee wages for a period of two years. (EEOC Recordkeeping Requirements). Additionally, employers must keep a copy of all employee benefit plans and merit systems while in effect and for at least one year after termination of the plan.

Documents related to employee leaves of absence under the Family Medical Leave Act (FMLA) should be retained for three years. 29 U.S.C. § 2626; 29 C.F.R. § 825.500. Remember to keep medical records confidential and separate from the employee’s personnel file. I-9 Employment Eligibility Verification forms should be retained for three years from the date the record was made or a personnel action was taken, whichever is later. 8 U.S.C. §1324a(b)(3) (Immigration and Nationality Act). I-9 forms should also be stored securely and separately from the employee’s personnel file.

This touches on a few, but not all, federal statutes governing document retention. These are general guidelines only, and exceptions may apply. Once an employer is aware of a potential lawsuit or charge of discrimination, employers cannot destroy records related to the subject matter of the complaint for any reason until complete resolution of the matter has been reached, including any appeals.

Tips for Borrowers Negotiating a Loan

Getting a business loan can be a long and difficult process. The bank wants to see everything, the good and the bad. Here are some tips when working with a bank to get a commercial loan. It all starts with a good term sheet.

  1. Make Sure You have a Lawyer review the Loan Before You Sign it. It’s understandable that you want to keep costs down, but don’t skip a legal review of the term sheet or letter of intent. Have your lawyer review it before you sign it. Getting counsel involved to review a loan agreement after a term sheet has been signed makes it difficult to renegotiate problematic financial or non-financial terms. An experienced credit finance lawyer will quickly identify terms that may be out of market and help you get them back in line with what works for your business. It’s in your favor to work as much detail into the term sheet (even if it’s a non-enforceable letter of intent) as possible before loan documents are prepared. The term sheet will set the tone for the rest of the loan negotiation, and you need to get it right.
  2. Know what the reporting requirements are for the loan. Borrowers understandably pay a lot of attention to the basic terms of a loan: interest rate, maturity date, financial covenants and events of default. But there are other important obligations in a loan agreement that are often glossed over by borrowers. For example, the borrower will typically be required to send the bank periodic reports on the borrower’s financial condition. Usually, this includes providing quarterly financials 30-45 days after the end of each quarter and its annual financials 60-90 days after the end of its fiscal year. Asset-based loans often require frequent reporting of outstanding accounts and inventory. Some lenders may ask for monthly (or even weekly) budget reports. The point is, the borrower will have to live with the reporting requirements. Be aware of what the bank wants and don’t be afraid to push back before you sign if the reporting requirements are too onerous. It’s critical to have an experienced credit finance lawyer on your side to let you know if the bank is asking for more than is customary.
  3. Know what collateral is and if its a part of the loan. If the loan will be secured, the term sheet should clearly describe the extent and types of collateral. For loans secured by personal property (as opposed to real estate loans), it may be as simple as “all assets” or it may be only accounts, inventory and equipment. Most banks will require borrowers to provide “first priority liens” on the collateral, so you need to know whether there are any outstanding liens on the collateral that won’t be paid off with the new loan. The bank will do its own Uniform Commercial Code (UCC) lien search to confirm this, but many headaches can be avoided by clarifying at the term sheet stage exactly what the bank will have as collateral.

Free Consultation with a Utah Business Lawyer

If you are here, you probably have a business law issue you need help with, call Ascent Law for your free business law consultation (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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Saturday, 24 November 2018

Temporary Child Custody

Temporary Child Custody

As you turn the page of divorce, you will encounter a variety of issues arising to the surface that may interfere with your child custody arrangements. This is why courts sometimes award a temporary physical custody of a child to one parent until things are clear. It all starts with one of the parents filing a petition. A Salt Lake City child custody Lawyer can prove helpful during these troublesome times.

BEST INTEREST OF THE CHILD

It’s all about the children. We want what’s best for them.  However, there are a number of factors that will be considered in order to determine what will contribute to the child’s healthy development.  The petition will explain the parent’s relationship with the child and the reasons why he or she believes child custody should be awarded to him or her. Some of the most important factors are the child’s continuity of school activities and family involvement.  Courts will not remove the child from a stable home except the current circumstances are affecting the child’s health and security.  Sometimes a child has a more emotional connection with one of the parents. This factor will also be considered.

FROM TEMPORARY TO PERMANENT

While temporary child custody is a nonpermanent solution, it might become permanent under some circumstances. If the parents can’t agree, then they will have to go to trial where evidence is presented in order to convince the court who should be granted physical custody. If the temporary custody is working out and the child loves the school, activities, friends, and current circumstances in general, the court may not interfere and allow that child to continue in the stable environment. Temporary Custodial parents should take their role seriously as it may become permanent.

SOME CIRCUMSTANCES THAT MAY INTERFERE

There are circumstances when parents awarded temporary child custody may not continue with these responsibilities once the permanent order has been determined.  A specific situation is when the custodial parent interferes with the non-custodial visitation rights. Some things such as scheduling activities during the non-custodial parent’s time with the child or making the children unavailable are forbidden by the court. Courts take these circumstances seriously. Children need to spend time with both parents as courts consider it in the best interest of the child.

HOW A SALT LAKE CITY CHILD CUSTODY ATTORNEY CAN HELP

Whether you are the potential custodial or noncustodial parent, it’s important you speak to an attorney regarding your child custody arrangements. A Salt Lake City child custody attorney will help you understand your rights as a parent and help you decide what’s best for the children. The initial hearings are very important as they will help decide the terms. Don’t allow your children to move out before consulting an attorney.    Child custody battles can be intense and you need to understand the laws involved. The best way to know what to do is having an attorney on your side.

USING ASSET PROTECTION TRUSTS TO PROTECT FROM DIVORCE

Protecting one’s assets from divorce is an important aspect of preparing for marriage in Hollywood and for an increasing number of couples, even those with modest wealth. Most people are aware of the use of prenuptial agreements for this purpose, but another potential way to protect one’s assets is to place them in an asset protection trust.

Asset protection trusts can be executed overseas or in the United States. In the latter case, they are referred to as domestic asset protection trusts. These trusts work by allowing the creator of the trust to be a discretionary beneficiary so that they still have some access to assets but are not vulnerable to creditors with respect to those assets. Currently, there are 15 states that recognize asset protection trusts. Utah is one of them.

The key to making asset protection trusts useful in the event of divorce is to ensure that the state law under which one forms the trust blocks the trust assets from a spouse. Not all states do that.

One important point to make with respect to asset protection trusts is that one must get the timing right with respect to the transfer of assets. An asset protection trust cannot be formed in anticipation of divorce. Many advisors would say that it is risky to form such a trust after the marriage has begun. Forming such a trust in anticipation of divorce is considered to be fraudulent transfer, which can result in legal penalties.

Those who are seriously considering an asset protection trust to protect themselves in the event of divorce need to work with an experienced attorney and plan things out as far in advance as possible. Doing so will allow one to avoid the accusation of fraudulent transfer and to rest a little bit easier with respect to the assets involved.

Free Consultation with a Child Custody Lawyer

If you have a question about child custody question or if you need help getting parent time with your kids, please call Ascent Law at (801) 676-5506. We will help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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Copyright Licenses

Copyrights give the copyright owner exclusive rights over their original works. While not all works are copyrightable, a few examples of copyrightable materials include movies, literary works, live performances, sound recordings, radio broadcasts, and even software. On the other hand, ideas, concepts, and facts cannot be copyrighted, and in order for a work to be eligible for a copyright, it must be in a fixed tangible form, such as a drawing on paper.

Copyright Licenses

As a copyright owner, you have certain rights that are exclusive to you, such as the right to display your work, distribute your work, make derivative works (a digital version of a published book, for example), and reproduce your work. You also have the right to authorize an agent to exercise your exclusive rights or transfer your copyright, in whole or in part.

Generally speaking, a copyright can be transferred to another party through an assignment or a license. An assignment means that you sell or give the copyright to another person or entity, which would result in your loss of copyright control. If you grant someone a copyright license, on the other hand, you are still the owner of the copyright, but the person who is granted the license (the licensee) can legally exercise some or all of the copyright owner’s rights. A copyright license is a practical option for copyright owners who wants to maintain control over how the licensee uses the rights.

Do You Need a Copyright License?

If you’ve composed a written work or song that you wish to promote commercially, you will want to license your work to allow others to distribute or perform it for a fee. A license may be exclusive or nonexclusive and can be restricted by factors such as purpose, territory, duration, and media.

An exclusive license allows only the party who signed an agreement with you (the licensee) to exercise the right being licensed. A nonexclusive license allows multiple licensees to exercise the same rights being transferred in the license. Exclusive licenses typically must be in writing to be valid, given the broad scope of such licenses, and all licenses should be recorded with the U.S. Copyright Office.

For example, if you’ve written a novel and wish to market it through a publisher, you can enter into a license agreement which grants the publisher the rights to copy and distribute the book in a specified geographic region. The publisher would enjoy these rights for the time period specified in the agreement. Unless specified in your agreement, the publisher would not have other rights related to your novel, such as the right to distribute the novel as an audio book or the right to turn it into a movie.

What is an Implied License?

While a written licensing agreement helps eliminate any confusion over the use and ownership of a copyright, an implied copyright license may exist in some situations. Generally, courts will recognize a license when the conduct of the parties implies such a relationship. In the absence of a written licensing agreement, courts generally base the scope of the implied license on the common practices within the community. As noted above, exclusive licenses may not be implied.

For example, suppose a yogurt company enters into a verbal agreement with a production company to use images from one of their cartoons on the front of the box. A court likely wouldn’t allow the yogurt company to produce its own show using these characters, limiting the scope of the license to just the yougurt containers.

Free Consultation with a Copyright Lawyer

If you are here, you probably have a copyright matter you need help with, call Ascent Law for your free consultation with a copyright lawyer (801) 676-5506. We want to help you.

Michael R. Anderson, JD

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506
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