Chapter 18

Subcontract

A contract by which a new party agrees to perform a duty that one of the original parties to a contract was already legally obligated to perform.

Arbitration

A dispute resolution process held instead of court cases in which both sides present their case to a legal professional.

Independent Contractor Characteristic

Behavioral: The contractor solely decides how the work is to be done.

Copyright

Exclusive right given to the creator of a literary or artistic work to make use of that work.

Vicarious (indirect) liability

Indirect liability or responsibility for the actions of another.

Design Patent

A 14-year patent for a new, original, and ornamental design for an article of manufacture.

Hourly fees

A basis for legal charges in which the rate is based on a price per hour. Often lawyers will charge for fractions of an hour.

Legal Entity

A being, human or nonhuman, such as a corporation, that is recognized as having rights and duties, such as the right to own property.

Check the box taxation

A choice LLCs can make on their tax returns to be taxed as a corporation or a partnership.

Sarbanes-oxley Act

A federal law describing the steps publicly traded businesses must take to protect and provide their key financial information.

Retainer

A fee paid by a client to an attorney to engage the attorney's services.

Litigation

A formal dispute resolution method that operates using the court system, typically with a lawyer representing each party.

Patent

A grant by the U.S. government to an inventor for an idea that is new, useful, and non-obvious, giving the inventor the exclusive right to make, use, or sell his idea

Flat fees

A method of billing for lawyers in which a fixed amount is paid for a certain task.

Hold Harmless

A type of waiver in which a party agrees not to hold another party responsible for certain events.

Articles of Partnership

Agreement between the partners of a firm on matters pertaining to the formation and operation of the partnership.

Trade Secret

Confidential information within a company that gives that company a competitive advantage

Trademark

Distinctive word, slogan, or image that identifies a product and its origin.

Articles of Organization

Document setting forth information about a limited liability company that is filed with the state to establish an LLC.

Pass through (taxation)

Earnings of the business are distributed to the business owners and those owners pay individual tax on the earnings.

Single Taxation

Earnings of the business are taxed once with the owners paying the taxes.

Double Taxation

Earnings of the business are taxed twice with the business as well as its owners being subject to tax.

Contingency fee

Fee paid by a client to an attorney for legal services that is dependent upon the outcome of a case.

Assumed name filing or a fictitious name filing

Filing made with a state(s) in which the business operates disclosing the trade name or assumed name of the business along with the owners of the business.

Independent Contractor Characteristic

Financial: The contractor pays his own expenses directly

Waiver

Part of a contract in which a party intentionally gives up legal rights or claims.

Exculpatory Clause

Part of a contract in which a party to the contract states that he or she will not be responsible for certain actions.

Noncompete Clause

Part of a contract in which a person agrees not to open a certain type of business or seek employment doing certain things in a particular area for a period of time.

Independent Contractors

Persons working to achieve a certain goal without being subjected to substantial controls by another.

2 step to structure a negotiation

Position by putting your best foot forward

4 step to structure a negotiation

Pounce when agreement on any part of the negotiation appears at hand

1 step to structure a negotiation

Prepare what you need to achieve

Intellectual Property

Property coming from some sort of original thought; for example, patents, trade secrets, trademarks, and copyrights.

Intangible Property

Property that has no value of its own but that represents value, such as a stock certificate.

3 step to structure a negotiation

Propose solutions that provide value and balance

Independent Contractor Characteristic

Relational: The independent contractor is employed for a project and the service the contractor provides is not central to the operation of the business.

Infringer

Someone who uses intellectual property without the permission of the owner.

Piercing the Veil

The dissolution of a corporate form, making it back into a sole proprietorship or general partnership, if the court finds that the owner carelessly mixed up personal and business assets or finances.

Trade name or assumed name or a doing business as (dba)

The name under which a business is operated.

Contracts

agreements in which the parties exchange promises

Standard Contracts

company can just fill in the blanks as needed

Firm must fully train

employees of the exact authority they possess

If employees make a decision requiring more authority than they really possess,

the business can argue that it was not liable for the problem

Mediation

the dispute is put to a neutral third party who is not a judge.

Specialty Contacts

unique contract terms, large dollar amounts at stake