by Andy Chen | Jul 12, 2023 | California, Enterprise, Law, in real life
I’ve written a few posts now about Limited Liability Companies (LLC) in California. In prior posts, for example, I’ve discussed whether an LLC can be used to form a law firm in California. I’ve also described the minimization approach law schools in the US typically use when teaching about business entities, like an LLC. I’m going to talk about LLCs in this post, but the basic logic I’m describing will apply to other types of entities also. In this post, I am going to expand on this idea of minimizing tax and legal liability. Most law schools start there and, unfortunately, also end there which means there is a bias towards always forming an LLC because, essentially, why would wanting to minimize tax and legal liability ever be a bad thing? In my view, it’s not a bad thing, but it might not be as good a thing as you initially think. The reason is because of Cost-Benefit Analysis. In other words, forming an LLC will result in several benefits, advantages, or positives. If you just stop there, then you should clearly always form an LLC. Realistically, of course, forming an LLC will also involve certain costs, drawbacks, or negatives. This should not be a groundbreaking concept to anyone because the same is true for all decisions you make in life. What ultimately matters when deciding to form an LLC is — like it is in other arenas in life — what the net result is. Do the benefits of having an LLC outweigh the costs of having an LLC? One relevant consideration here would, for instance, be whether...
by Andy Chen | Jul 9, 2023 | California, Enterprise, Law, in real life
A lot of people now have side hustles or are otherwise self-employed. If you’re one of these people, you might have wondered at some point whether or not you should form a legal entity of some kind, such as a Limited Liability Company (LLC). Doing so is much easier now than it was, say, even 5 years ago. Many websites advertise that they will help you form an LLC in California, Nevada, or Delaware in 10 minutes or less for $99, for example. In this post, I’m going to discuss just LLCs given how common and popular they are. They are, by no means, the only entity out there. In 2021, for example, I wrote a post about whether you can use an LLC in California to form a law firm. Specifically, I’m going to describe something simple, namely how the question of “Should I form…” is taught in law school. Law schools in the US often address this topic in a survey course discussing business organizations or entities. At my law school, the survey course was, in fact, called “Business Organizations”. That course analyzed this question from the perspective of minimization. In other words, when forming a business or running a business, the typical owner is concerned about minimizing two things: Minimizing their legal liability. In other words, if their business does get into legal trouble of some kind (e.g. lawsuit from a customer or vendor, etc.), the business wants to limit the scope of their potential loss or exposure. Minimizing their tax liability. I’m sure you’ve heard many, many stories about how very large publicly-traded companies that...
by Andy Chen | Jul 4, 2023 | California, Criminal law, Law School Help
In looking over my blog posts, it appears I started — or at least had aspirations to start — making posts aimed at law school students. Specifically, I wanted to add some real-world details to the offenses that law school only teaches in a general or basic way. To be fair to law schools, this general or basic way is by necessity as the school has no idea which jurisdiction, if any, the student will ultimately practice law in and how that jurisdiction defines that particular offense. Many legal offenses are defined in terms of a criteria-based approach. In other words, the offense in question (e.g. robbery) has a set number of requirements or criteria that have to be satisfied. If the “net evidence” shows that these criteria have been satisfied or proven to a specific standard (e.g. beyond a reasonable doubt), then the defendant will be guilty or liable of that offense. I say “net evidence” here because you should remember that the decision of guilt or liability will be made after considering (1) the evidence tending to show guilt or liability as well as (2) the evidence tending to not show guilt or liability. There is no quantitative way to compute what evidence cancels what, but the idea of a net balance should still make sense. In other words, is there ultimately more credible and reliable evidence showing guilt or liability or is there more credible and reliable evidence showing that the defendant is not guilty or not liable? If all of that made sense, I’m going to talk about the crime of robbery in this post...
by Andy Chen | Jul 2, 2023 | Family Law, New York, Statutes... and stuff
I’ve been licensed to practice law in New York since 2012. Unfortunately, I do not maintain an office in New York. This means that I cannot take clients who live in New York due to the NY Court of Appeals‘ 2015 ruling interpreting NY Judiciary Law section 470 in the case of Schoenefeld v. State of New York, et al. That appears to be changing, though. Legislation has been passed by both the New York State Senate and, as of June 7, 2023, the New York State Assembly to repeal Judicial Law Section 470. Stay tuned for updates. Because Section 470 is still in effect, I can’t practice law in the state of New York. However, what I’m going to discuss in this blog post and all my NY blog posts that follow is information any member of the public can look up for themselves. I offer no opinion on whether the particular statute or case I go over is advisable or prudent for their particular situation. My hope is that, even though my blog posts are purely factual, my post will give the enterprising reader an idea or plant a seed for further research that they would otherwise not have had. Put simply: after reading my factual post, maybe you can do more research that didn’t occur to you before and, hopefully, be better off for it. In this post on the laws of the state of New York, I’m going to talk about the residency requirements for a divorce. A residency requirement is the basic idea that in order to file for divorce in a given state...
by Andy Chen | Jun 29, 2023 | California, Statutes... and stuff
In today’s post, I’m going to go over what is often referred to as the “Pink Tax” or the practice of charging more for products aimed at women simply even when the same product for men, for instance, has a lower price. In September of 2022, the California Legislature passed Assembly Bill (AB) 1287 which became effective as of January 1, 2023. AB 1287 added a new section — Section 51.14 — to the California Civil Code. As always, I encourage to actually look up the entire text of the statute section. I am only going to point out the major parts of Section 51.14. The main part, in my opinion, is Section 51.14(b), which says: “A person, firm, partnership, company, corporation, or business shall not charge a different price for any two goods that are substantially similar if those goods are priced differently based on the gender of the individuals for whom the goods are marketed and intended.” If you’re wondering what terms like “business” or “substantially similar” mean, that’s described in Section 51.14(a). As an example, “substantially similar” is defined as (1) there being no substantial difference in the materials used to make the item, (2) the intended use of the items are similar, (3) the functional design and features of the items are similar, and (4) the brand of the items is the same or the brands of the items are owned by the same party. I bolded and underlined “and” above to emphasize that (1) to (4) must all be true simultaneously in order for the items to be “substantially similar” within the meaning of...
by Andy Chen | Jun 26, 2023 | California, Family Law
If you’re involved in a California family law case of any kind where there are minor children present, there’s a good chance you’ve heard of terms such as “joint legal custody”, “joint physical custody”, etc. Terms like these are not difficult to understand, but many terms in court are used so frequently that lawyers, judges, etc. will assume their meaning is obvious. This is especially true in family court where, at least in my experience, most people are unfamiliar with the laws and procedures that are used. A huge amount of unnecessary confusion results, which is obviously not helpful to anyone getting a good outcome. In this post, therefore, I’m going to define these terms, tell you what statute sections they come from, and any practical commentary that pops to mind. Joint Legal Custody (CA Family Code Section 3003) For whatever reason, California’s Family Code doesn’t define “legal custody” or “physical custody”, but rather defines those terms with the modifier of “joint” or “sole” instead. Joint Legal Custody is defined in Section 3003 of the California Family Code as: “’Joint legal custody’ means that both parents shall share the right and the responsibility to make the decisions relating to the health, education, and welfare of a child.” I’ve bolded and underlined the terms “health, education, and welfare” because that’s fundamentally what legal custody is all about. When it comes to minor children (again, this is a child under age 18 typically), imagine something that the parent would have to give permission or authorization for regarding that child. This might be, for instance, a permission slip for the child to...
by Andy Chen | Jun 24, 2023 | California, Family Law
If you’re involved in any sort of child custody or visitation case in California, it’s just a matter of time before you encounter the “Best Interest” standard. In other words, the California courts want to do whatever will be in the “best interest” of the minor child or children in question. In my view view, though, the term “best interest” is tossed around so much that practically-speaking, it’s lost a great deal of its meaning. The vast majority of people involved in a custody and visitation case — lawyers and litigants alike — will no doubt use the term “best interest” but be unable to define what the term actually means. In this post, I’m going to provide you two definitions for the term “best interest”: (1) the formal technical definition from the California Family Code, and (2) a more practical definition which will hopefully be more useful in the real world. The Formal Definition Regardless of what you may feel personally, the only definition of “best interest” that ultimately matters is the formal technical one as specified in either California statute, California case law, or both. Discussing the case law is going to make this blog post way, way, way, way too long so I’m going to be limited to the statute only, namely Section 3011 of the California Family Code. That section says as follows: “(a) In making a determination of the best interests of the child in a proceeding described in Section 3021, the court shall, among any other factors it finds relevant and consistent with Section 3020, consider all of the following: (1) The health, safety,...
by Andy Chen | Feb 19, 2023 | California
If you’re an inmate in California and you want to be able to talk to your friends and family, it’s going to cost you money. Shockingly, there is not much — cough, none, cough — competition in California’s jails and prisons when it comes to an inmate choosing what company to use to place a call to their family. Prices for calls are very high. There are two reasons why these high prices matter. First, the family of an inmate can go into debt. More often than not, the families who do go into this kind of debt are already living with precarious finances. Punishing the family of an inmate makes no sense. Second, if the price is too high and the aforementioned debt is incurred, at some point the family members can no longer afford to incur it. For example, they can’t borrow any more money and the calls to the inmate have to stop. Now, some of you might be thinking that there’s nothing wrong with this. The inmate committed a crime after all and they need to suffer hardship for it. Looking at it from the perspective of making inmates suffer or not suffer misses the point, I think. There’s a more universal conclusion that I think we should all be able to get behind: reducing the occurrence of crime is a good thing so that fewer people get murdered, fewer cars get broken into, and fewer grams of cocaine or methamphetamine get sold. Having the support of family and friends makes it easier to accomplish almost anything in life. I’d say that includes inmate recidivism....
by Andy Chen | Oct 13, 2021 | California, Enterprise
Nowadays, it’s really easy to form a Limited Liability Company (LLC). A simple Google search leads you to a bunch of websites that — apparently — will fill out and file all of the forms for you in a few minutes for a low flat fee. I’ve not used any of those sites before so this is absolutely not an endorsement of any of them. Perhaps I’m old-fashioned in this regard, but I still form all of my California LLCs by hand myself with the California Secretary of State’s office. In this post, I’m going to go over a little bit about what California law allows an LLC to be used for. As it is me, I’m going to specifically answer whether an LLC can be used to form a law firm. If you’re a lawyer or law student in California, you probably know that the answer to that question is “no” but I’ll describe the specific statute(s) involved that support that answer. To answer the first question of what an LLC can be used for in California, the answer to that question is in the California Corporations Code, and specifically Section 17701.04. In short, an LLC can be used for a wide variety of purposes — assuming it is lawful, of course — in California, with the exception of a few purposes that are explicitly prohibited. For example, section 17701.04(b) says: “A limited liability company may have any lawful purpose, regardless of whether for profit, except the banking business, the business of issuing policies of insurance and assuming insurance risks, or the trust company business. A domestic or...
by Andy Chen | Oct 10, 2021 | California, Enterprise
In this post, I’m going to go over a very common question that people have when they form a Limited Liability Company (LLC) in California. Forming an LLC used to be very complicated and expensive. Very few people formed them. Nowadays, though, that cost and difficulty has gone way down. LLCs are now available to more people. Just do a quick Google search and you’ll inevitably find many sites promising to help you fill out and file all of the necessary forms in a short time for a low fixed fee. The question, though, is this: Is the Operating Agreement one of those documents that has to be filed with the State of California? Before answering that question, as background for those who don’t know, an Operating Agreement is, well, an agreement between the various people or entities who have decided to form the LLC together. As all of these parties are going to be involved in the LLC, two of many things an Operating Agreement typically goes over are (1) what the various parties are each responsible for doing, and (2) what the various parties are each entitled to receive. As you can hopefully guess, any time multiple people are involved in doing something, there is always the chance for disagreements to occur. Disagreements, fundamentally, are what lead to litigation. For a more complete list of what an Operating Agreement can cover, take a look at Section 17701.10 of the California Corporations Code. If you’re interested, the term “Operating Agreement” is defined in Section 17701.02(s) of the California Corporations Code: “’Operating agreement’” means the agreement, whether or not...
