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Detroit & Chicago Business Organizations Legal Blog

Former co-defendants now on opposing sides

People who have to look out for their professional or business interests know that many things can change a person's perspective at any time. Who may seem a strong ally one moment could well end up as an adversary down the road. Such seems to be the case for two professional fighters as one of them has just initiated legal action against the other in Cook County, Illinois. 

Interestingly, the current lawsuit that pits the two men against each other stems from a prior lawsuit in which they were joint defendants. Together, the two men were sued for alleged defamation by a physician who was apparently displeased with comments the men made on a podcast regarding issues with medical care. The Chicago Sun Times has reported that the two defendants won this lawsuit.

Business' options under new tax law

Business owners in and around Chicago or Detroit know that they have to watch their bottom line and many things go into this. Taxes are one of the factors that can make a big difference to a company's profitability and vice versa. In light of the new tax law that went into effect this year, some companies might be looking at making some changes to take maximum advantage of the law or to avoid paying even more tax.

As explained by Inc. Magazine, until this year, many people found it advantageous from a tax perspective to create limited liability companies or S corporations instead of C corporations. Today, however, many may be re-evaluating this decision and might even be considering converting their LLCs or S corporations to C corporations. Doing so would give them the ability to enjoy the dramatically reduced corporate tax rate.

Couple files lawsuit after being barred by senior community

Michigan residents may be aware that the Fair Housing Act protects individuals against discrimination based on gender and other attributes. However, a Missouri retirement community called Friendship Village recently rejected a lesbian married couple citing the fact that they were married. This was after they toured the facilities and made a $2,000 deposit. Friendship Village reportedly believes that marriage is between a man and a woman as stated in the Bible.

In a lawsuit, the couple claims that this violates the Fair Housing Act. One of the women says that she didn't check to see if the couple's lifestyle would be an issue because other facilities had said it would not be. They chose Friendship Village over the other options because of cost and the care that was made available to them. Legal professionals have mixed opinions as to how the case will be decided. One said that the law will probably side with the retirement community as it is a private organization.

Contract negotiation tips

Entrepreneurs and company executives in Michigan and Illinois know that negotiation is part and parcel of getting business done. Hammering out the details of contracts such as lease agreement, purchase deals, vendor or distributor agreements and more can be intimidating to some but there are ways to make it work effectively. 

As explained by Entrepreneur magazine, one of the most important things for people to do is to prepare for the contract negotiation process to take some time. It should be remembered that a contract is a legally binding document and rushing into a contract may have many negative consequences down the road.

Minorities more likely to live in dangerous conditions

People of color in Michigan and throughout the country are often shown homes in areas with poor environmental quality compared to white people. This is the finding of a study prepared for the National Bureau of Economic Research. Its results show that people of color are often steered into neighborhoods that are close to toxic sites or that have high levels of air pollution.

The research was based on data collected by the U.S. Department of Housing and Urban Development during its own housing discrimination study. That study looked at neighborhoods in 28 American cities and found that certain characteristics determined where individuals were most likely to live. The HUD study used both white and minority actors who presented themselves as similarly qualified to buy a home. Information about the homes suggested to them was then compared with Environmental Protection Agency data.

When is a contract legally binding?

Contracts are part of doing business, whether you are an individual or a corporation in Chicago or elsewhere. Although it is always a good idea to put any agreement in writing, oral contracts are enforceable under Illinois law if there is enough evidence to support that a deal was made. However, there are exceptions, which are covered by the statue of fraud 

The Chicago Tribune explains that the statute does not apply to real estate contracts. The three elements that are needed to make a contract legally binding are an offer, an acceptance and consideration. The process begins with the buyer making an offer. Most courts agree that merely advertising a house for sale at a set price does not make it an offer. Instead, it is asking others to make an offer.

Michigan housing community under investigation for discrimination

Bay View Association in Petoskey is under investigation for allegedly requiring homeowners to have Christian beliefs as a condition of residency. In addition, homeowners there have claimed that they aren't allowed to transfer their property to family members who aren't Christian. This is despite the fact that the community was told by the U.S. Department of Federal Housing that it isn't exempt from an anti-discrimination law.

In 2016, there were 18 complaints filed against Bay View claiming that the rule violated the Federal Fair Housing Act. A court hearing has been scheduled for July 30. Those who are in favor of the rule believe that it leads to more financial assistance as well as support from volunteers. They say that this is because the residents are fully invested in the Christian lifestyle that the community promotes. The association requires that a church leader confirm that cottage owners are members of the church or attend services.

The basics of Sarbanes Oxley

Company executives in Michigan and Illinois who have worked for private companies but now may be looking to switch employment to a public company or who may work for a company looking to go public will quickly learn that a very different set of oversight is involved for publicly traded companies. There are many advantages for a business to becoming public including the infusion of cash into the business that happens with an initial public offering. But, executive staff must be educated about their responsibilities and understanding Sarbanes Oxley is a good place to start.

As explained by Inc. Magazine, the Sarbanes Oxley Act of 2002 was passed in large part as a response to some highly prominent corporate bankruptcies and fraudulent reporting practices that left many employees and investors with significant financial losses. There are 11 unique elements of the act that cover everything from auditing and accounting practices to criminal penalties for white collar crimes.

Sexual harassment victims have rights

Those who are seeking housing in Michigan may find that they are the victims of sexual harassment. While victims can be of either gender, they are often single women with children or those who have limited housing options because of their income. Regardless of whether harassment is physical or verbal, it is illegal under the Fair Housing Act. Despite this, victims often choose not to report what has happened to them.

Typically, those who experience sexual harassment fear that they won't be able to stay where they are if they do speak up. However, those who do talk about their experiences could be entitled to compensation or other legal relief. In a case involving a Detroit property manager, a jury found that the manager and a landlord were liable for sexually harassing six tenants. They were ordered to pay $115,000 to the tenants.

Evaluating corporate status and tax options

Entrepreneurs who are looking to start a new business always need to choose an operational stucture. In so doing, they also choose a corresponding tax model and when it comes to C and S corporations, the tax model can vary greatly. Many companies elect to use the S corporation structure in large part due to the tax advantages they enjoy compared to with a C corporation. However, with the new tax code in place, many companies may be re-evaluating this decision.

As explained by Inc. magazine, the Tax Cuts and Jobs Act will see the maximum tax rate for C corporations drop from 35 to 21 percent. This change may make starting a business as a C corporation or switching from an S corporation to a C corporation financially advantageous. Another perk is that this change is permanent where some other elements of the legislation are only temporary.

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