Business Formations

SOLICITOR IN CHARGE: TOM FITZPATRICK

Member: Lawyers for Your Business

Please also see

Commercial Property Wills Enduring Powers of Attorney Litigation

There are many legal matters to be considered when starting a new business.

This page will help you to set your agenda with your solicitor by telling you how FitzPatricks will approach the questions you want to ask. That saves money.

1. Challenges

  • Getting the brilliant idea off the ground with the minimum of cost.
  • Keeping the business growing profitably and expansively. This involves understanding how many people (called stakeholders) have an interest in the well-being of the business and then identifying them.
  • Recognising that many viable businesses fail because, while so much effort goes into manufacturing, staffing, selling and premises, there is little time for getting administration right. But it has to be done and the sooner the better, because the risks become greater as the business grows.

FitzPatricks approach your business from your viewpoint, not ours, and with the same enthusiasm that you have.


back to top

2. Starting

  • For many new businesses, the initial involvement of solicitors is restricted to deciding whether a company or a partnership is needed. That advice is needed, but FitzPatricks can do more.
  • The general belief is that solicitors are useful only when problems arise. We are really useful in helping to ensure that problems are squashed before they start to become troublesome and interfere with cash-flow and running the business.
  • At FitzPatricks, we do not believe in problems. We believe in challenges, as you do, or you would not be starting your new business. A challenge means knowing where the winning post is and that you can reach it. A problem is something which cannot be defined, so there is no apparent way of starting to deal with it. FitzPatricks can help you turn a problem into a challenge and then signpost the way to solving it.
  • At FitzPatricks, we also believe in solutions. Not merely do we work with you and the other members of your team, accountants for example, but we are able to advise on where the challenges may come from, then help you to minimise the risks. We can, if you want, help set up the team of advisers. If you do not have an accountant already, you will need one very quickly.
  • We can advise you on the contracts you will need and help you prioritise them. We also prepare them.
  • Your challenges come from the many people having an interest in your business. They are called 'STAKEHOLDERS'

Note: It is important for the owners of all businesses to consider their wills to make sure that there is power for executors to manage businesses in the short term and to ensure an orderly change-over to new management. This helps to protect the business.

Also, an Enduring Power of Attorney should be considered to appoint Attorneys to act in the event of an accident or medical crisis.

back to top

3. Stakeholders and Power

  • 'Stakeholders' is the new buzzword. It goes to the Seat of Power because it affects everything that you are trying to do and your power to run the business the way you want. All stakeholders need close attention because they can hinder as well as help. We now even have to worry about stakeholder pensions.
  • Stakeholders need your business to do well and can be vengeful if it does badly.
  • Some stakeholders have more funding than you have. If a dispute arises, and however hard we try, this does mean that with their deeper pockets they can impose their financial will on you if the matter in dispute is not cut and dried. That is why we are keen on getting your contracts right.
  • At FitzPatricks, we enjoy preventative law, by taking steps before the disputes happen to cut the risks down and leaving you to do what you are good at – making money, cutting down the arguments you can well do without and avoiding the stress of dealing with your lawyers as well as those of your opponents. This is a matter of drafting contracts. Of course, if a difficulty does arise we can work with you to help you solve it.
  • In the majority of cases, where disputes arise, we can work with you through our litigation department to help solve them. Go to Litigation
back to top

4. How to avoid the Lawyers:

  • Relations between owner and other stakeholders do create tensions. This is particularly so at the start of a business when cash flow must, at all costs, be maintained. The owner may be prepared to take less money out of the business in return for future prosperity but other stakeholders may not feel the same. The question for the owner is how to deal with the other stakeholders. It is often best to agree these matters before you start. Good relationships are vital.
  • Virtually everything the business does, and every relationship it has, is a contract – few contracts need be in writing. Not all contracts may be legally binding. For example, a letter of intent is not a contract, but most other things are. If contracts are not in writing, and matters result in a dispute, the question that will arise is who said what to whom. Sorting the answer to that question is a Lawyer’s Bonanza. Better, by far, is to get the contracts in writing, as soon as time and money allow, if not sooner

There follows a list of stakeholders. Against each are examples of the types of commercial contract which concern that relationship.

  • the owner, spouse and family; - articles of association, directors’ service agreements, partnership agreement or shareholders' agreement, pensions;
  • the staff; - contracts of employment, compromise agreements; pensions;
  • the bank; - loan agreements, mortgages on homes or business premises; unsecured loans; personal guarantees; factoring agreements;
  • the customers; - sales conditions; franchisors’ agreements; consultancy agreements;
  • the suppliers; - purchase conditions; franchisees’ agreements;
  • the landlord; - leases and tenancy agreements;
  • the credit reference agency; litigation relating to accuracy of information;
  • shareholders (if any); - articles of association, shareholders’ agreements;
  • partners (if any); - partnership agreements; confidentiality agreements;
  • debtors; - litigation to recover money, compromise agreements; factoring agreements;
  • creditors; - action to stave off litigation, compromise agreements;
  • professional advisers; client care agreements;
  • Insurers; - life and keyman cover, premises, contents, public liability and product liability cover.
  • anyone else with whom the organisation does business or has a financial interest in the success of the company – miscellaneous, but don’t forget taxman and vatman.

FITZPATRICKS CAN PROVIDE COMMERCIAL DOCUMENTS FOR YOU OR CONDUCT AN AUDIT OF YOUR EXISTING CONTRACTS AND PROCEDURES– WE CAN ADVISE YOU ON NEW CONTRACTS YOU ARE ASKED TO SIGN AND NEGOTIATE CHANGES IF YOU WISH.

Well-written agreements can make the difference between positive and negative cash flow, between having and avoiding disputes, between acceptable and unacceptable legal bills – theirs as well as yours. See also litigation –



Your other advisers

You get the best from your advisers if they can work together with you and with each other. FitzPatricks believe in teamwork.

back to top