Over time, most entrepreneurs run into legal complications. These can cause high costs and lead to financial problems if action is not taken quickly and effectively. In this video we provide an overview of the legal challenges entrepreneurs face and how these can be resolved.
We find an example of where things can go wrong legally at the start of the company. Entrepreneurs with a sole proprietorship and partners in a partnership (VOF) are personally liable if debts arise with the company. If an entrepreneur is married in a community of property, not only the entrepreneur but also the partner is personally liable. If the entrepreneur gets into financial difficulties with his or her company, the partner becomes jointly liable for the entrepreneur's debts. It is therefore important that you as an entrepreneur together with a notary ensure that you do not marry in community of property. If you are already married, please have a change in your marriage conditions planned.
Another example of legal complications is the deterioration of the business relationship between partners. When a fight arises between partners, all the attention and energy goes to battle with each other as the company goes down. It is therefore important that partners establish a contract right from the start in which they determine what happens if they can no longer work well together.
A further complication are procedures. It is of course important that in such cases you engage a lawyer and recover what you are entitled to. But it is also important to look at the total costs of a worst case scenario. Suppose you have a claim from €7000 and the other party has only €6500 paid. In that case, a procedure can cause costs that are greater than the amount to which you are entitled. If you have to deal with procedures, make sure you make good price agreements with your lawyer. We also see with some regularity liability statements for a poorly delivered product or poor service. Here it is important to see if you can arrange. This is often better than a lengthy procedure that causes a lot of attorney fees. In general, it is advisable to take out legal expenses insurance to be prepared for such situations.