Pick the correct legal structure for your business
Choose the form of a business structure that gives the best protection against financial and personal liabilities.
Sole trader and partnerships have few start-up requirements but leaves the owners vulnerable to the most serious legal risks.
Put everything in writing
Aim to write up every transaction that takes place in your business. This includes any type of agreement, financial transactions, important conversations and contracts. If you are not able to adequately put your contracts in writing then use a lawyer.
Keep Your contractual agreements simple
If you decide not to seek legal advice when writing agreements make sure legal documents are written in plain English that are clear to understand. If your document is incomprehensible or ambiguous then it will be less likely to be enforceable in the courts.
Make sure your policies and terms and conditions are made clear to your customers
Your policies relating to company disclaimers, refund and return policies should be written in plain English. If information is not easily understandable or difficult to find or read, because of small fonts, it may be deemed to be unenforceable by the courts and will not in any event be viewed favourably by your customers.
Keep good financial and legal records
You should keep your financial records up-to-date and accurate. Large businesses and Corporations should have auditing practices in place and conduct an all-encompassing audit every couple of years. This avoids being questioned by legal authorities for financial mismanagement or overlooking directors inadvertently or intentionally committing fraudulent trading.
See if you can get business liability insurance. It is expensive but is vital to ensure you business is not crippled by legal setbacks and high legal fees. An effective policy will provide cover for legal costs in case you are sued but have not done anything wrong.
Get the right permits and accreditations
Make sure your business has all the correct licenses, permits, insurances and registrations it requires to trade. Carry out six monthly audits on your business to make sure that these do not lapse and there are no other new laws you need to be aware of your in business which you must comply with.
Make sure your customers and staff are happy!
If a complaint arises from an employee, customer or other business supplier then try to resolve it as soon as you can. A complaint should never be ignored. Allegations and fabrications can be made against you at any time but even the smallest of claims need to be addressed as soon as possible. If you fail to do this you open yourself up to being sued and it is more difficult to support your side if you delayed in addressing the complaint.
Keep on the right side of the law
The last point is dead simple. Know the law. and do not do anything unethical or illegal. Sounds straightforward but if you are not familiar with the laws of your country then you could by accident break them. Remember that ignorance of the law is not a valid defence under any legal system. If you are not sure what the laws are you need to be aware of then contact a lawyer.
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