Why Structuring Your Business as a Limited Liability Entity is so Extremely Important
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Why Structuring Your Business as a Limited Liability Entity is so Extremely Important

by | Aug 31, 2022 | Business Law |

Transcript:

Hello, I’m Animated Doug Jackson.  Live-Action Doug Jackson is the founding attorney of The Law Firm of Douglas G. Jackson.  Live-Action Doug Jackson has again asked me to step in for him to help educate you on business law.  Today, we’re going to talk to you about including a forum selection clause in your service agreements.

Before we begin, I have to give you the legal disclaimer that I’m just an animation.  I’m not actually human.  Apparently, only humans can get law degrees, which technically makes me a non-attorney spokesperson.  Also, what is with this background?  I mean, I guess live-action Doug Jackson has limited space and uses a green screen, but, as the better thinner and better-looking animated version of Doug Jackson, I live in the virtual world.  I can go anywhere.  Let me help this situation a little more.

There, that’s better.  Now, we’re ready to learn.

What were we talking about, again?  Oh, that’s right!  I was going to tell you why it’s important to have a forum selection clause in your service agreements.  Live-Action Doug Jackson talked to you about service agreements before.  Do you remember?  You can go back and watch the prior videos if you want, but why listen to Live-Action Doug Jackson when I’m so much more interesting?  I’ll just give you a quick recap, instead.

A service agreement is a contractual agreement between a service provider and a service receiver.  As a Florida business who provides a service to your client, you are the service provider and your client is a service receiver.  Live-Action Doug didn’t explain that very well in his video, did he.  He may be a brilliant attorney, but I’m one hundred times better at video education.  I mean, I should be.  I basically wouldn’t exist if it weren’t for video.

Ok.   What’s a contract?  A contract is a legal agreement that binds two or more parties to its terms.  It is often in writing, but doesn’t always need to be in writing.  If one party doesn’t live up to the terms of the contract, which is called a breach of contract, you can get a court to enforce the terms.

Now that we know the definitions of a service agreement and a contract, do you remember from Live-Action Doug’s past video two general reasons that a Service Agreement is so very important if you run a business that provides services in Florida?  That’s right, reason number one that it defines the scope of your service.  This sets expectations up front, and it will limit your liability to the things you actually promised the client you’d do.  Reason number two is that it spells out the process for how to resolve disputes.  This means that if a dispute does arise, both parties know how to make a complaint and how to enforce the terms.

Now, we’re going to add a third reason that service agreements are so very important.  If you have to take the breach of the service agreement to court, you get to say where and which court will handle it.  Let’s look at a hypothetical example.

You own business in beautiful St. Petersburg, Florida, which is also where The Law Firm of Douglas G. Jackson has its office.  You are so very excited because you just landed your first client in Miami.  You’re expanding fast and next, you’re planning to have some out of state clients.  You’re about one month into doing business with your Miami client, and the Miami client accuses you of breach.  They file in court in Miami.

The claim is completely frivolous and without merit. But that doesn’t matter because you still need to defendant it.  If you don’t respond to a lawsuit, no matter how frivolous, the other side will win.  You can’t just ignore a lawsuit.  It won’t just go away. Yet, you’re busy running a growing business.  You don’t have time to go to Miami to handle a lawsuit.  You don’t even know any lawyers in Miami because the only lawyers you know have their offices in beautiful St. Petersburg, Florida. How could you have avoided all of this?

The answer is simple, and if you had a good business law attorney helping you, you would know too.  You need a forum selection clause in your Service Agreement.

In law, we talk about in which forum you can file a lawsuit.  The forum is basically the court.  Some courts might have jurisdiction and some courts might now.  In a contract, such as a service agreement, you can select the forum before any dispute arises.  If you put in your service agreement a strong forum selection clause, you can make sure that only courts in Pinellas County, Florida can hear any lawsuit related to your service agreement.

This is why forum selection clauses are so important.  Your contacts are in St. Pete.  Your lawyer connections are in St. Pete.  You are operating a growing business in St. Pete and don’t have time to go to Miami for court.  Make sure your Forum Selection clause keeps you in our beautiful Tampa Bay area by limiting the forums that a lawsuit can be filed to Pinellas County or such other forum that best fits the needs  of your business.  As you can imagine this becomes even more important if you are handling business with clients who are out of state.

Make sure you have a strong forum selection clause in your Service Agreement!

Now, as a final word, please remember that The Law Firm of Douglas G. Jackson is located in beautiful St. Petersburg, Florida! Reach us by calling 1-800-704-6045. Again, that’s 1-800-704-6045, or find us online at www.GetYourLegalAction.com. Again that’s www.GetYourLegalAction.com. Having trouble remembering the website? Just remember to Get Your Legal Action at The Law Firm of Douglas G. Jackson!

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