Legal Considerations for Global Entrepreneurs

Wednesday, 17 December 2014

Contributed by Guest Blogger: Alice Harrison

Having a great idea and possessing the grit and determination to develop it into a profitable business is of vital importance for anybody that wants to succeed in the cutthroat world of global commerce in the 21st century. However, without a well-defined legal entity to act as a vehicle for one’s entrepreneurial ambitions, even the most determined of people will run into difficulties, sooner rather than later in many cases. Below is a short review of some of the issues to consider when forming a new company.

Liability  this is probably the singularly most important factor that should be considered when setting up a new commercial organisation to further your business ambitions. Whilst choosing to operate as a sole trader in the UK, or a sole proprietorship as they are known in the USA, involves less paperwork than the alternatives, it is also the riskiest option as far as personal liability is concerned. As a sole trader, your business debts will be treated as personal debts meaning that if your company goes under, so will you. Whilst hiding behind a limited company or corporation to avoid settling debts might seem dishonourable to some, one has to be practical when considering the possible ramifications of a failed business to the sole trader. A legal entity that protects the entrepreneur from having to satisfy the debts of the company he is running is normally the most practical solution for all but the smallest of business ideas.

Image – this might not seem like a big consideration for a one-man band selling handcrafted goods from home but as soon as you start to expand and find yourself having to negotiate terms with national or even international retail organisations your corporate image will become very important. A limited company in the UK, or a corporation in the USA, simply projects a more serious and financially stable image to potential customers and suppliers, which can make negotiating new contracts a much easier proposition. Whilst there is no reason to presume that a limited company is in a better position financially than a sole trader, the fact that the owners of such companies are obliged to publish year end accounts means it is easier to establish whether they actually are or not. This is why larger organisations prefer to deal with incorporated or limited firms.

Taxation – as a director of a limited company in the United Kingdom, you may choose to take part of your salary in the form of share dividends, which canhelp to lower the cost of your National Insurance contributions. The amount of tax that you pay on an annual basis will also normally be considerably less when paying yourself in this manner. If you decide to go down this route, you will need to produce accounts up to the date that the dividend amount is decided, as well as a set of minutes for the board meeting at which the dividend is authorised. Finally, you will need to issue dividend vouchers. Failure to comply with any of these steps could result in your dividends being declared illegal.

Location – certain locations have certain benefits for company owners when it comes to forming or incorporating a new commercial entity. For example, entrepreneurs in the United States frequently hire firms such as Delaware Corporate Services to incorporate in this business-friendly state and many global business owners choose to incorporate in tax havens such as the Cayman Islands and Bermuda, for obvious reasons. Whether it is both legal and practical for you to incorporate on a Caribbean island or a particular state in the USA will depend on the nature of the business in which you areinvolved and is something that you should establish by consulting a qualified legal professional.

If you are ready to take the first step toward turning your entrepreneurial dreams into commercial reality, you should first spend some time investigating all the possible forms that your new company might take. It is much easier to stay within the law than to extricate yourself from a legal mess after the fact so make sure that whatever choices you make will be looked upon favourably by the relevant authorities.

Posted by Sally Peat at 10:18 0 comments  

"Good" Law

Tuesday, 2 December 2014

As part of BIALL's November Newsletter, Daniel Hoadley examined 'Good' law

Back in September, Jane Riley (of the Manchester Law Library), posted an important question on LIS-Law which I have paraphrased below:

"If there is no case status (no positive, considered or negative treatment, etc.) on either [name of online service] or [name of another online service] next to a particular Court of Appeal case, does that mean that the case has not been judicially considered? And, if so, can the case be classed as good law?"

At the heart of this apparently straightforward query is a broader, more fundamental question: can we rely on online legal research platforms to tell us whether cases we are thinking of deploying still represent "good law"? My view on this is simple: no, we cannot.

The era of the traffic light indicator

Most online platforms incorporate some visual mechanism to indicate what the future authoritative value of a case may be. The mechanism favoured by most online publishers is some sort of "traffic light" system.
Notwithstanding minor variations in presentation and terminology, a common formula is green for positive treatment, red for negative, blue for neutral and yellow for mixed judicial.  The traffic lights undoubtedly have their uses, but it is critical to understand they do not relieve the user of the responsibility to check that the case remains good law by reference to the purpose for which it is to be deployed.

What does "judicially considered" actually mean?

The first thing we need to be clear about is what we mean by "judicially considered". Has a case really been "judicially considered" by virtue of fact that the judge refers to it once, along with an ocean of other authorities, in the course of a judgment running to a hundred paragraphs? The threshold must be higher than a mere mention. The better test is this: does the decision in the earlier case play a material role in the court's reasoning in the later case? If so, then the earlier case has been "judicially considered" in the later one.
However, to carry out this operation properly, "someone" needs to read and analyse the judgment in the later case to determine whether the earlier case is being considered. And, preferably, that "someone" needs to possess the requisite legal knowledge and skill so that the rest of us can place some trust in their assessment.

Okay, so the case has been "judicially considered".

What type of consideration did it receive?
The job doesn't end there. Logically, once we've concluded that a case has been judicially considered, the next task is to categorise the class of treatment the later case is meting out against the earlier case.
This is where the simple traffic light system starts to wobble. The traffic lights can tell us the broad mode of treatment (good, not good, neutral and in-between), but they do not tell us the specific class of treatment. If the traffic light says the case has been positively treated, what type of positive treatment was it given? Was the case applied, followed or approved? If the case has mixed judicial treatment, was it distinguished or explained by the later case? This may strike some as pedantry, but when it comes down to it, these modalities may have a significant bearing on the future application of the case and the researcher able to identify and understand these distinctions is in a better position than the researcher who cannot.
Again, these categorisations do not magically materialise out of thin air - "someone" has to read the case and make an assessment.


I have given the algorithmic approach to judicial consideration pretty short shrift elsewhere and I'm going to do the same here. This is not the kind of research operation that is amenable to the pushing of a button and trusting whatever a computer churns out. The problem is that when a judge is considering a case, she will very rarely say something like, "I am considering/applying/distinguishing this case" in the judgment. More often than not, any conclusion on judicial consideration turns on being able to distil the ratio of the later case, comparing it against the ratio of the earlier case and then inferring the class of consideration from that inquiry.
No computer-driven service can perform this task better than a person.
Good law?

Good law for what?

An important limitation of the traffic light system, or indeed any system of case-based legal analysis, is that it will only tell you whether the status of a case, or of a particular proposition of law established by that case, has been affected by subsequent case law. That is not, however, the only factor potentially affecting the question whether a case is "good law". A fairly stark example will suffice to point out this limitation.
In 2008, the House of Lords gave judgment in R v Davis [2008] UKHL 36; [2008] 1 AC 1128. R v Davis decided that where prosecution witnesses gave evidence from the witness box under conditions of anonymity, the conduct of the defence case would be so hampered as to render the trial unfair and a conviction unsafe.
Now, let's suppose I'm appearing in the Crown Court with instructions to resist an application by the prosecution for their star witness to give evidence anonymously behind a screen in the witness box. It looks like R v Davis will deliver a deathblow to the prosecution's plans, doesn't it?

If you look up R v Davis on WestlawUK, Lexis Library, JustCite and ICLR Online (see, I can be objective), you will see that WestlawUK's traffic light reports "positive or neutral treatment"; Lexis says "positive treatment indicated" and JustCite and ICLR Online rank Davis as having been "considered". The traffic lights on four online services are telling me that I should be safe to say that Davis is good law for the proposition that prosecution witnesses cannot give evidence anonymously in a criminal trial, right?
Wrong. The traffic lights are not telling me one, absolutely whopping detail that blows a massive hole in Davis's value as authority: the decision in Davis was overruled by Parliament (in the Criminal Evidence (Witness Anonymity) Act 2008, which was superseded by the Coroners and Justice Act 2009) only a month after the decision was handed down. If I had relied solely on the traffic light indicators, I would have been completely in the dark.

Moral of the story: the answer as to whether a case is good law for a proposition of law may not lie in the case law. The silver bullet or the fatal blow may actually be lurking in the statute book.
There are limits to what legal publishers are able to deliver
Comprehensively sweeping the case law landscape and analysing judgments requires massive quantities of time and qualified human resource. All of us publishers are trying to do the best job possible with the resources we have available. But there are limits to what we're able to do and as usual things boil down to a trade-off between quality and quantity of output.

It is not the job of legal publishers to pummel you with an endless torrent of ubiquitous and potentially flawed information. Our job is to approach legal publishing as carefully and as thoughtfully as our resources permit, in order to guide and equip the researcher as accurately and reliably as possible.  From there, the responsibility shifts to the researcher to apply their knowledge and skill to reach conclusions on the law that they are sufficiently secure in to put there name on. 

Law is an art, not a science. There are no binary questions and there are no binary answers. Online research has opened up mega quantities of information, some of it good, some of it not so good. But, let's not allow ourselves to be dazzled by the coloured lights and technical wizardry. At the end of the day, good old fashioned human research skills and savvy are what gets the job done best, both within and beyond the four corners of your computer monitor.

Daniel Hoadley, Barrister - The Incorporated Council of Law Reportingments retrievable using Search Center.

Posted by Sally Peat at 13:00 1 comments  

Legal Reference Materials Course

Thursday, 13 November 2014

BIALL is running the Legal Reference Materials course again on 15th December at City University.

This course is intended for recent entrants to law librarianship and for those working in more general libraries which have legal materials. The aim of the course is to introduce participants to the structure of law and legal materials as well as to teach participants how to use the basic legal reference materials. The one day course also provides participants with practical experience. This is an ideal course for both librarians and assistants.

- Tony Simmonds from the who is Senior Librarian at the University of Nottingham will be taking participants through legislation sources.
- Emily Allbon Lecturer in Legal Skills and Method and Director of Mooting at City University will be taking participants through case law sources.

Please see our website for full details and booking form.

Contributed by: Lisa Anderson

Posted by Sally Peat at 12:25 0 comments  

British And Irish Association Of Law Librarians (BIALL) – Written evidence (DSC0020)

Monday, 3 November 2014

Published on the Parliament website:

Essentially, it's a summary of the LETR work and how our response highlights the role information professionals can play in skilling the future workforce (in the legal sector).

Q4. What skills do future workers need in order for the UK to be globally competitive? How do the digital skills required for technical roles compare to those needed by the wider workforce to operate in a digitally competitive environment? Can the current supply chain deliver this?

In response to this question, the British and Irish Association of Law Librarians (BIALL)[1], will be referring to those working in legal practice and studying in Legal Education as those who fall under the ‘wider workforce’ who will need to work in the increasingly digital environment as opposed to those with the technical skills who will be building the future digital environment. As BIALL recently contributed to the Legal and Education Training Review (LETR), this response is a summary of BIALL’s contribution to the LETR.

Posted by Sally Peat at 13:28 0 comments