Willow Creek Law, LC
8160 S. Highland Drive, Suite 300
Sandy, Utah 84093
801.233.0606

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Utah Business Law

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Disputes and Litigation

If you have an unresolved legal dispute to bring to court, we can help. The formal litigation process is lengthy and complex. Our experienced Utah litigators will help you determine the best way to handle your case.

Business Law

Whether you are starting up your first business or just want to keep a good business running smoothly, we can help.   We prepare organizational documents, advise business owners on business entity selection, and give counsel on a wide variety of commercial disputes and business transactions..

Contract Law

A solid contract can limit disputes and save a company money. We have experience drafting contracts for small and large businesses. We have experience drafting contracts for a wide variety of businesses. 

Real Estate Law

We handle residential and commercial real estate transactions. Our experts have experience with mechanics lien's, mortgage foreclosures, real estate development, title insurance, and more. 

Corporate Counsel

We provide dedicated legal services tailored specifically for your business goals and designed to work within your budget.

Estate Planning

We help clients create and implement simple or complex estate plans. We handle administration of estates in probate court, and counsel clients on ways to minimize estate taxes and protect their assets.

Our Services

We assist in forming LLCs, corporations, and partnerships, and in advising businesses and business owners as they develop and negotiate contracts and work to expand their businesses. 

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Our Philosophy

For those businesses that cannot afford in-house counsel, we provide an outside, less expensive option. We believe in the principles of integrity, fair play, and affordability. Please do not hesitate to contact us to see if we are a good match for your legal needs.

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Why Work With Us

At Willow Creek Law we are concerned with providing high quality legal services at a reasonable price.  We believe that the practice of law should be engaged in with the highest ethical standards, and that .....

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Frequently Asked Questions

Estate Planning FAQs

What is a will?

A last will and testament is a legal document that sets forth your wishes for the distribution of the assets you have acquired during your lifetime. In your will, you also can name one or more persons to be the guardian of your minor children, if you should die with minor children. Additionally, in your will, you nominate who you want to be the Personal Representative (formerly called Executor) of your estate.

 

If I am married, does my spouse need a will, too?  Or is my will enough?

Because it is impossible to know who will die first, you and your spouse should both have a will. Fortunately, because both the husband and wife often have the same desires for the disposition of their assets, personal representatives, guardians and other provisions, a will for your spouse can be created for no additional cost.

 

What will happen to my children if I die without a will?

If you have minor children when you die and you do not have a will that nominates a guardian, there be a court hearing in which a judge will determine who will best be the guardian of your children. In a will, however, you can nominate who you want to be the guardian of your minor children after your passing, and if the will is valid, the court must respect your nomination in your will unless someone challenges your nomination.

 

Will the government take my assets if I die without a will?

As discussed above, should you die without a will, your estate will be distributed according to the manner the Utah State Legislature had determined through statues. However, if you want to be the one to determine how your assets are distributed after your death, then a will is vital. Additionally, in your will, you can nominate who you want to be the guardian of your minor children, if you should die with minor children

 

What is the difference between a will and a trust?

A last will and testament is a legal document that sets forth your wishes for the distribution of the assets you have acquired during your lifetime. In your will, you also can name one or more persons to be the guardian of your minor children, if you should die with minor children. Additionally, in your will, you nominate who you want to be the Personal Representative (formerly called Executor) of your estate.

Like a will, a trust is often used to distribute assets after death, and a trust is usually created with a legal document. But, unlike a will, a trust can be used to own and hold property. A revocable trust is one that is revocable and amendable by the person(s) making it as long as they are living. A revocable living trust is a revocable trust created by a living person. If all of your assets are owned in a valid revocable living trust, all of your assets can pass to your heirs without any requirement to go through the court process called the probate process.

What is a living trust?

A living trust is a trust that is created during your lifetime, as opposed to a testamentary trust which is created after you die as directed in a will.

 

What are some of the purposes and benefits of a trust?

In many cases, one purpose of a revocable living trust is to avoid the court process called probate. If all of your assets are owned in a valid revocable living trust, your estate can be divided after your death by your chosen trustee and completely settled in shorter time frame than the typical probate court proceeding. Another common purpose of a revocable living trust is to allow your family to more easily manage your assets while you are living, if you become incapacitated or incapable of caring for yourself. Also, in cases when estate tax may be owed after your death, a revocable living trust can save your estate (and your heirs) thousands of dollars in estate taxes after you have passed. For example, with a properly prepared and funded Revocable Living A-B Trust, married couples can effectively double the amount of their assets that pass to their heirs free of estate tax. Further, a revocable living trust can be used to avoid probate in multiple states, when you own real estate in multiple state. Trusts can be used for many other purposes.

 

My estate is small so I don't need a living trust, right?

Many of the benefits of revocable living trusts apply regardless of the expected size of your estate. It is true that, for larger estates where estate tax may be owed, certain revocable living trusts can be used to save your heirs thousands of dollars in estate taxes. However, that is not the only benefit of a Living Trust. Even small estates can benefit from Living Trusts. If the trust document is properly drafted and administered and if all of your assets are owned in the trust, your heirs may be able to completely avoid the time and cost of a court probate process after your death. Another common benefit of a revocable living trust is to allow your family to more easily manage your assets while you are living, if you become incapacitated or incapable of caring for yourself.

 

Can I just write up my own will?

We do not recommend preparing your own will. However, if you follow the proper statutory procedures for preparing and executing a will, it should be a valid will. In order to give yourself and your heirs the best opportunity to have a legally valid will that complies with Utah law, we recommend that an attorney prepare your will and that an attorney supervise its execution.

 

What is probate?

Probate is the court process that is required so that possessions and property can be passed from someone who died to their heirs and family. A probate action begins by filing a petition with the court to open a new case and to have someone appointed by the court to act on behalf of the estate as the Personal Representative of the estate. The term Executor of the Estate is another term sometimes used and has the same meaning as Personal Representative. Through this process, the Personal Representative obtains the authorization from the court to settle the affairs of the estate. The Personal Representative has certain duties when handling the estate, including:

Paying the final bills

Determining heirs of the estate

Preparing an inventory of the estate

Gathering all of the assets of the estate for distribution

Filing a final tax return for the estate

Determining the validity of claims against the estate and, when necessary, paying those claims

Distributing the assets of the estate to those designated in the will or, when there is no will, to those heirs of the decedent as designated by Utah statutes.

Additionally, potential heirs of the estate must be identified and notified about the probate proceedings. Other responsibilities of the Personal Representative are to notify any known and unknown creditors of the estate. Once they have been notified, creditors have a specified time to make claims against the estate. Generally, if a creditor fails to make a claim within the brief time period allowed by law, that creditor will lose the ability to make a claim. Known creditors must be contacted directly to be informed of probate proceedings.

For unknown creditors, notice of probate proceedings must be published in the newspaper. Creditors' claims are paid according to priority and based on the amount of assets of the estate available to pay claims.

 

When is probate required?

Probate is usually required to transfer assets held in your name after you die. If you own real estate or have a bank account, a probate proceeding is nearly always required to transfer those assets. It may be possible to transfer clothing and other similar personal effects without a probate proceeding, but each situation is different. If your estate is worth less than $100,000 and does not include real estate, a simplied court process can often be used. We can provide advice regarding whether probate is required in your situation.

How long does the probate process take?

The probate process takes a minimum of approximately four months, but often takes longer than that. If there is any dispute as to the validity of a will or the desires of the decedent, a probate case can sometimes take years to fully resolve, depending on the complexity of the dispute.

 

How is the probate process concluded?

Once the heirs of an estate have all been identified and have received notice and creditors have been notified and their claims have either been paid or denied, and assets have been distributed to the proper heirs, the probate action can then be closed through either an informal or formal court process. With an informal closing, documents are filed with the court and the probate case remains open for one year. If, after that one year period, there are no matters pending with the court, the appointment of the Personal Representative terminates. With a formal probate closing, the court approves the distribution of assets and the probate case is immediately closed and the Personal Representative can be immediately discharged of any further duties.

 

What is the role of the court?

The court oversees the entire process including authorizing the appointment of the Personal Representative and resolving any disputes that may arise with creditors or heirs of the estate. The court can either have a formal role in a probate matter, or an informal role. If there is no dispute between any of the heirs of the estate or creditors of the estate, the probate matter can be handled informally. With informal probate matters, typically no hearings or court appearances are required and the probate can be fully resolved through filing documents with the court. With a formal closing of a probate matter, a Request for Formal Closing is filed with the court and a hearing is held and a judge authorizes the closing of the estate.

 

What are the costs involved in probate?

As of 2012, the court charges a filing fee in the amount of $360 to open a probate matter. To publish notice to creditors, newspapers usually charge around $200. Additionally, if you hire an attorney to prepare the court filings and guide you through the probate process, you will pay their hourly fee. Fees for probate can vary widely, depending on what is needed. For a basic, uncontested probate matter, it may be as little as a few hundred dollars. For more complex estates that are contested in court, the fee could be significantly more based on the amount of time required to resolve and administer the estate.

 

What revocable living trusts ARE:

Revocable living trusts can be thought of as separate legal entities with legal rights and obligations, similar to those of an individual or a corporation. In general, trusts can own and manage property, including both personal property and real estate.

Revocable living trusts are often used to accomplish an individual's or couple's estate planning purposes, such as distribution of their assets after death. Many people are uncomfortable with the public nature and expense of probate (the process by which an estate is administered legally after death). For these people, a living trust can often provide greater privacy and fewer costs after death, as well as a relatively flexible entity for managing assets.

While a last will and testament is an expression of an individual's desires regarding his or her estate and interests (including the care of minor children), a trust can accomplish those goals through a different approach. A trust can be formed while you are still alive and can own and manage all of your assets. You create a living trust by executing a trust agreement while you are living. Usually upon creation of a revocable living trust, you will turn all of your assets over to the trust for management. The trust will remain revocable (i.e. can be terminated) by you. Your assets will then be managed by the trustee of the trust, who is usually you -- the person(s) who created the trust. As such, you remain in full control of your assets to the same degree you would if you did not have a trust. Upon your death or incapacity, your trust is managed by successor trustees that you nominate before you die in the trust agreement. They step into your shoes and follow the instructions you have set forth in you trust agreement, which may include: caring for you during incapacity, paying for funeral expenses, distributing money and other assets to relatives or friends, filing and paying taxes, winding up your affairs, continuing to hold property in trust, etc.

Generally speaking, if all of your assets are owned by your trust, the trust estate does not need to be administered in probate court, which can save considerable time, expense and effort.

 

What revocable living trusts are NOT:

While it is impractical to attempt to list everything a living trust does not do (such as drive your car for you and feed the dog), it is useful to dispell some common myths.

First, a revocable living trust does not provide asset protection. Transferring your assets to a revocable living trust, with nothing more, does not protect those assets from lawsuits brought against you.

Second, it does not change your obligation to the Internal Revenue Services to pay income and related taxes. Likewise, it is not meant as a vehicle for hiding property, avoiding child support payments and other legal obligations.

In sum, revocable living trusts are not there to avoid legal obligations or to assist in committing fraud or deception.

Lewis & Kleinman provides revocable living trusts as part of a trust package, which includes: a living trust, wills, general powers of attorney, special health care powers of attorney, living wills, and deeding your personal residence into your trust. We offer the trust package for an affordable flat fee whenever appropriate.

Business Law FAQs

What is a limited liability company (LLC)?

Protect Your Personal Assets

Imagine that an employee of the new business you own acts negligently and seriously damages customer property; the customer sues and wins. Imagine that the damage is not covered by your business insurance (for whatever reason). Can the customer require that YOUR personal home be sold to cover the damage caused by the employee?

The answer to this question depends on (1) whether your business is established in a form of entity, such as a limited liability company, that protects the business owners' personal assets from the liabilities of the business and (2) whether you are treating that entity properly as a separate business.

So, if your business is not established as a LLC or corporation, your personal assets are at risk.

Why Choose An LLC?

Management Structure Flexibility. An LLC can choose its management structure, rather than having its management structure imposed by law. For example, an LLC can choose a multi-layered management structure like a corporation, OR it can have a simpler, owner-managed structure akin to a partnership.

More Choice in Method of Taxation. A multi-member LLC (Note: Owners of an LLC are called "members") can choose to be taxed as a partnership (the default) OR a C-corporation or a S-corporation. Corporations cannot choose to be taxed as a partnership.

No Annual Meetings. Utah laws do not require that LLCs have formal annual meetings of the members. Corporations must have annual meetings.Why Not Choose an LLC? (Is a corporation the better choice?)Perceptions. Some financial institutions might not regard LLCs as favorably as corporations, believing that LLC owners may not be as serious about their business endeavors as corporation owners. You can always overcome any such initial bias with your actual (and presumably impressive) financial record. But, if first impressions with financial institutions are important to your business, you might consider a corporation.Venture Capitalists. If your business will be seeking funding in the future from a venture capitalist firm (a group of wealthy investors), you might consider a corporation. Some venture capitalists prefer to invest in corporations, but it is only one factor. In the end, the right business will get investment regardless of its form of entity.

 

Is my LLC required to have an Operating Agreement?

We recommend that all LLCs have an Operating Agreement, but LLCs formed in Utah are not required by law to have one. Operating Agreements contain the terms of the business agreement between the members (i.e., the owners) of an LLC. Important issues are addressed in an Operating Agreement, such as: what limitations will we place on a member's ability to sell his or her membership interest (i.e., our ownership) in the business to someone else? or what happens if a member dies? or what percentage of votes will it take to agree to add a new member or sell the business? If your LLC does not have an Operating Agreement, state laws will decide these and other important questions for you, possibly in a manner that you do not like.

 

What is an S Corporation?

An "S Corporation" is a corporation or another type of business entity that has chosen an IRS taxation category for its business that is commonly referred to as "S Corporation". The S stands for small. Business entities that choose to be taxed in the S Corporation tax category do not pay income taxes directly. Instead, the income taxes of the business are paid by the owners of the business. An LLC can choose to be taxed as an S Corporation, in the same way that a corporation can choose to be taxed as an S Corporation.

 

Can being taxed as an S Corporation save me taxes?

In some situations, choosing to be taxed by the IRS as a S Corporation can be used to reduce the self-employment (or FICA) taxes paid by the business' owners. However, considerations other than the owners' saving on self-employment / FICA taxes might dissuade your business from choosing to be taxed as an S Corporation. In fact, many of the business owners we assist with their business entity formation do not choose S Corporation taxation.

Here is a very basic explanation of how the potential tax savings is achieved for some businesses owners of S Corporations: When your business is taxed as an S Corporation, the business will pay money to you (the owner) in two ways: (1) As a salaried, W-2 employee/officer, with a regular paycheck, and (2) As an owner, with a dividend or distribution. Paycheck payments to you as an employee are subject to both income tax and FICA taxes. Dividend payments to you as an owner are subject only to income tax (not FICA taxes or self-employment tax). However, the IRS requires that you receive a reasonable salary as an employee for your services rendered to the business, in order to allow the dividend payments to avoid FICA/SE tax. What constitutes a reasonable salary is not defined in the code or regulations, but courts have looked at various factors, including (but not limited to) what comparable businesses pay for similar services, training and experience, duties and responsibilities, time and effort devoted to the business, dividend history, and payments to non-shareholder employees.

 

How do I choose between forming an LLC or S corporation?

The decision between forming a limited liability company (LLC) or corporation or another type of entity can be complex. You will want consider the current and future ownership and management structure of the business, future plans of the business, and taxes, among other things.

 

Do I really need all that legal boilerplate in my contract?

Including terms at the end of contract that are often referred to as "boilerplate" serve the important purpose of saving you time and money when disputes arise later. For example, disputing parties to a contract can spend thousands of dollars arguing in a lawsuit over whether the written contract is the entire agreement, which state's laws will be used to interpret the contract, which court has jurisdiction to hear the suit. It will be much cheaper to include the "boilerplate" terms in the contract than to argue about those issues when a dispute arises later. Click here to read our article about contracting considerations.

Buying or Selling a Business FAQs

Buying or selling a business is a critical transaction in the life of the business owner. Buyers are concerned about many things, but might particularly be wondering "What am I really buying?" or "Is this business really what it appears to be?" Sellers also have many concerns, chief of which might be "Will the buyer be able to make his installment payments to me and what happens if he does not?"  Having a legal advisor that is experienced with buying and selling businesses will allow you to properly address the many and varied risks of this transaction. Having legal sales documents that are customized for your situation to address these risks will ease and guide many problems that may arise after the sale is complete.

 

What is the Basic Process?

Preparing for the deal.

The first step is sometimes overlooked--preparation. If you're selling a business, this is a critical step. Are your corporate documents in order? Are your critical contracts with employees, suppliers, customers, landlords, and others ready for sale? Are your financial documents in order? Have you positioned the company for a strong selling price? Lawyers and other advisors, such as business brokers and investment bankers, can offer valuable preparation advice and assistance. If you're planning to buy a business, preparation should not be under served. What are you looking for? Have you researched the industry?

Matching Buyer and Seller and Price.

Finding a willing buyer and seller is the crux of the deal. Business brokers, investment bankers, and sometimes other advisors such as accountants and lawyers can help you find one another. People often ask us "what is a fair price for this business?" Our initial response is often: "Whatever the buyer is willing to pay and the seller is willing to accept. This is the basic economic fact, and we often lose sight of that fact when formulaic methods for valuing a business come into play, as they almost always do. Business brokers, investment bankers, valuation trained accountants and others experienced with business sales can give you specific advice on price.

Deciding Upon a Sale Structure. The structure of the sale is often decided before the buyer and seller are matched. In very simplified terms, there are two basic structures: (1) selling the assets of the business (aka "Asset Sale") and (2) selling ownership of the business entity (aka "Stock Sale"). For smaller businesses, asset sales are the most common.

In an asset sale, the seller's existing business entity (e.g. LLC or corporation) sells the assets of the business (e.g. equipment, inventory, the business name, rights under a lease, etc.) to the buyer. After the sale, the seller's entity continues to be owned by the Seller's owners, but the entity has no (or very few) assets.

In a stock sale, the seller's owners sell their ownership of the seller's existing business entity (e.g. stock of a corporation or membership interest of an LLC) to a new owner. After the sale, the seller's entity is now owned by the buyer. Asset sales are common in small transactions for several reasons, but a major reason is that, if properly documented, the Buyer does not take on the liability of the business prior to the closing. Whereas, in a stock sale, the buyer assumes the liabilities of the business from before and after the closing.

There are also important tax considerations when choosing a structure. Finally, a third type of structure is lurking: a merger in one of its many varieties.

Properly Documenting and Closing the Sale to Address Risk. When you buy or sell a car, you will sign a "Bill of Sale." The two basic purposes of the vehicle "Bill of Sale" are: (1) to legally acknowledge the car's new owner and the terms of the sale (such as price) and (2) to address risk by saying, as is common, that the vehicle is sold "As Is." When selling a business, the sales documents also serve those two basic functions: state the terms of the sale and address risk. However, both the terms of the deal and the provisions addressing risk are much more complex when selling a business than when selling a car.

The terms of the deal might include, for example: (a) An agreement to close the deal at a later date, after a period of time when certain things must occur, and (b) seller financing of a portion of the total purchase price with interest and other terms.

The contract provisions that address the risks that could arise after the closing of the sale often consume the majority of the ink in business sale documents. Businesses are almost never sold entirely "as is." Often, first-time business buyers and sellers will underestimate the need for extensive provisions addressing certain risks.

Risks to carefully address include, for example: (a) a buyer not making installment payments to the seller (This often involves a separate Security Agreement and UCC filings.), (b) the possibility that the buyer will become aware, after closing, that the seller did not disclose critical information about the business to the buyer during the sale process, and (c) obligating the seller not to start a competing business after the closing.

Contracts and Agreements FAQs

Contracts and Agreements

Have you ever carefully considered why you should have a carefully drafted written contract? In most cases, the main benefit of a carefully drafted contract will become readily apparent when a problem arises. "Let's see what the contract says," is the usual comment in a dispute. Until then, the contract may have remained in a file.

 

What do I need to know?

When a dispute arises, having a contract that is clear and unambiguous and addresses the specific problem may keep a dispute from escalating. Anything that helps the parties resolve a dispute without litigation is well worth it.

If the dispute cannot be resolved and a lawsuit unfortunately ensues, a well-drafted contract can continue to benefit the parties. First, if the contract language is clear and unambiguous in the eyes (and the often peculiar language) of judges and lawyers, the dispute could be resolved in a more streamlined fashion. Second, if the contract comprehensively addressed various likely issues and problems, less time might be taken to resolve the issue. For example, including terms that are often referred to as "boilerplate" might serve the important purpose of keeping the parties from arguing over things that are not directly related to the dispute at hand, such as: what state's law will be used to interpret this contract? or does this court have jurisdiction to hear this suit about this contract?

Some agreements must be in writing to be valid at all. For example, in Utah and most states, contracts involving a sale of goods of more than $500 must be in writing to be legally binding.

What Others Are Saying

Tyler

Chris has been very helpful and knowledgeable, answering my many questions. He has been great in insuring that I have all my legal responsibilities covered and brought to my attention important documents that I was missing. I really trust him.

Lyman

I was involved in a land transaction in which I needed professional help. Chris is the Attorney that I chose. He was up against an Attorney who was very forceful and loud. Chris was calm and steady and we ended up with a satisfactory contract. The problems were caused by the Realtor adding terms into the contract that the other party wanted with out me knowing about it. Chris did a great job. I have been back to him on another matter and received the same great results.

Call us today at 801-233-0606 or email lgl@willowcreeklaw.net

We'd love to meet with you and discuss your individual legal needs. We are confident our services are top notch. Let us show you how we can help your business navigate the often murky waters of Business Law.

About Us

Willow Creek Law assists businesses and individuals in corporate governance and in navigating contract disputes and litigation. We provide services in commercial litigation, contract disputes, small business partnership break-ups, and other areas for small- and medium-size businesses.

Contact Us

Willow Creek Law
8160 S. Highland Drive, Suite 300
Sandy, UT 84093

801-233-0606
lgl@willowcreeklaw.net