Archive for the ‘Corporations’ Category

Partnerships, LLCs and Corporations may not be represented by Owners

Written by Michael Pisauro on August 2nd, 2010 in Basics, Corporations, Courts, Limited Liability Company | No Comments »

The other day while researching an issue I came across a case that required noting.  It is not a new case but it discussed an issue I have come across several times over the last year.  If you are a partnership, corporation, or limited liability company, you cannot represent the business in Court.  All business entities must hire an attorney to represent the business in Court, with few exceptions.  This is a requirement set out by the New Jersey Supreme Court in the Court Rules.  R.1:21-1.

That means that if your partnership, LLC or corporation is owned money from a customer, you as an owner of that company cannot file a lawsuit in Court.  That means if your company is sued, you as an owner of the company, cannot file an answer on the company’s behalf.  If you do file a complaint or answer on behalf of the company, and for some reason the Court allows it, you could spend months if not years in litigation just to have the judgment voided by the other side because your company was not represented by an attorney.

As I noted above there are a few limited exceptions to the general rule.  One of the exceptions apply in cases under worth $3,000 or less and which could have been filed in small claims.  There are two exceptions that apply to municipal court.  In all of these exceptions the company could be represented by an authorized officer or employee.  Lastly, a partner of a general partner, not a limited partnership, can represent the business in summary actions for possessions of property.

Shareholders now entitled to 20 days notice of and to dissent to mergers, acquisitions, etc.

Written by Mike Pisauro on July 26th, 2010 in Corporations | No Comments »

When a Company wants to merge or consolidate with another business or wishes to buy another company or be sold to another company, the Company needs the approval of its shareholders.  That approval can occur in two ways.  First the Company can have a meeting of its shareholders where the proposal is voted on by the shareholders.  The second method, unless forbidden, by the corporate documents, is for the action to be approved by the shareholders through their written consent.

Recently, New Jersey has amended the time frames controlling the use of approval by written consent.   P.L. 2010 c. 105 amends NJSA 14A:5-6’s time frames.  The new law   requires the corporation to notify any who did not consent that the proposed action was approved and will take place no sooner than 20 days from the notice.  This notice must also provide that the shareholder has a right to dissent and to be paid the fair value of the shareholder’s shares.  Under the original statute, shareholders only received 10 days notice.

The new law also provides that the corporation can eliminate the post approval notice by providing in its original request for the written consent of its shareholders, the date that all of the written consents will be counted.  This request for written consent must be at least 20 days and not longer than 60 days before the counting of the “votes”.  This solicitation of consent must follow other requirements as well but they have not been changed from the original statute.

In short, P.L. 2010 c. 105 doubles the existing notice period for certain actions.