Huntley Legal's Blog
19 November 2020
As a business, you might extend credit to your customers and get it covered by a guarantee, either from your customer’s company or from one or more of the owners.
Although these personal or company guarantees are seen as “security” for the original credit, they are themselves not secured in any way (unless the guarantor is also willing to give you a mortgage over a property or other assets).read more »
05 November 2020
Some people give their whole life to a company. They invest a fortune into it. Yet companies can easily get into trouble, especially now because of Covid.
Company directors often make assumptions about what the role involves. In fact, there are a shedload of misconceptions. I’ll address some of them in this article and more another time, because they are really important.read more »
15 October 2020
Electronic signatures are being used a lot more. It has recently been confirmed that they are valid in English law, according to the 2019 Law Commission report and a UK government announcement in March 2020.
There are benchmarks relevant to when an electronic signature is valid and legally binding. In short:
- Electronic signatures are valid when the person who is signing intends for the electronic signature to validate the agreement, and by using an electronic signature, they agree to be bound by that agreement
- All other documentary formalities are to be observed as well as using an electronic signature
Of course, the situation is not quite that simple. This article explains more.read more »
08 October 2020
Boilerplate text is usually considered to be as dull as ditch-water. But it has taken on a new life since lockdown. What was once a boring part of any commercial contract has become an interesting and vital area.
A year or two ago, if you had suggested to most businesses that they should take an interest in the boilerplate section, they would have rolled their eyes, thinking it was too dreary to motivate them, or too standard and benign to be worth any time or effort.
We would have said that pigs might fly – but they did and they are still flying! Things have changed a bit.
Because of the whole range of national, local and even international rules and restrictions that have impacted all our lives since March 2020, for whole sectors of the business community, some parts of the boilerplate text have become quite familiar. In particular:read more »
02 April 2020
When you are selling a company or a business, confidentiality can be a bit of a dilemma because you can’t sell it without telling someone! Unless you’re selling in response to an unsolicited offer, you will probably need to talk to a business sales agent or other people in your sector about the possibility of selling.
Some people are rightly fearful about telling anyone, because it risks creating a rumour mill suggesting that the business is in difficulties. If the communication is not managed well, the news can alarm staff, suppliers, customers, creditors and bankers. It might also alert competitors to a perceived weakness in your business position.
Such rumours could have a negative impact on your business and its price. Buyers will be less keen to part with their money for a business that is rumoured to be in trouble. You should therefore judge carefully what you say, and to whom, and always ask for a confidentiality agreement to be signed.
23 March 2020
If my clients are buying a company for a significant price – up to £millions in some cases – they really don’t need me to tell them that they need to do thorough due diligence because they’ve already bought into the idea.
On the other hand, when clients are about to buy a business for a modest price (or possibly, even being paid to take it on), they often ask whether due diligence is worth the bother and cost.read more »
05 March 2020
Answer: it’s quite hard to tell!
After lots of fuss, the UK left the EU at 11 pm on 31 January 2020. Months of further fussing are to follow before we know if it will be with or without a trade deal. We are currently in a transition period that is due to end on 31 December 2020 – unless, by the end of June 2020, there is an agreement between the EU and the UK to extend it by one or two years.
That means we have been experiencing a really long period of uncertainty since 2016, and now face a further long period of uncertainty.
That said, we do have a modest level of certainty about what happens during the transition period, even if we don’t know how long it would be.
This article explores more.read more »
20 February 2020
An increasing percentage of startup businesses are providing their service through a mobile app or software platform.
However, many people are vague about how to protect their intellectual property in the systems and software they build.
For example, you might be wondering if you can patent your software. In the UK and Europe, the current answer is usually no.
The most applicable protection is copyright, because (as you might be surprised to discover) software is treated as a literary work!
The protection for literary works was obviously designed for books, and doesn’t apply in exactly the same way for software and computer programs. The problem is that software isn’t always as simple as a printed publication on paper.read more »
13 February 2020
I often speak to long-term shareholders and business owners/managers who don’t really understand what dividends really are or know their liabilities around them.
People often loosely think of dividends as a way for owners and shareholders to get money out of the business, perhaps because this can be particularly tax-efficient for start-ups.
However, company dividends can also be quite a technical area, with terrible consequences if you do things wrong, such as when shareholders get too greedy or the Board is too generous.read more »
06 February 2020
There are specific issues to consider if your small company is owned by you and your family members, or even by a group of people who aren’t related. They also apply when there are a small number of people who invested significantly at an early stage.
How do you define a small company? For the purposes of this article, there is no magic number, but let’s say it’s less than six shareholders (so it could be more or less staff).
In this situation, you have to talk about things that people don’t often like discussing. Here are some of them.read more »