Business Practice
Welcome to Beffa Law, your trusted Toronto business lawyers. We care about your business’s success and are committed to providing expert legal guidance to businesses in and around the Toronto area. Our firm was built on the philosophy of developing long-term relationships with our clients, regardless of whether they are initially big or small. For business lawyers, long-term clients are successful ones, and we have a vested interest in helping you succeed. Whether you are an individual sole proprietor, a partnership, a corporation, or a non-profit organization, we are here to support your legal needs and help you navigate the complexities of business law. Our team of experienced lawyers is dedicated to negotiating, solving problems, and offering timely legal advice to ensure the growth and success of your business.
Extensive Business Knowledge
Whether we are acting as our client’s business lawyer, corporate lawyer, commercial lawyer, franchise lawyer, or commercial real estate lawyer, we pride ourselves on being able to negotiate, solve problems and provide timely advice for our clients.
Our Business practice specializes in all aspects of business law in and around the Toronto Ontario area.
Types of Entities we represent:
– Individual/Sole Proprietor
– Associations and Cooperatives
– Partnerships
– Corporations
– Non-Profits
Legal Guidance to Your Businesses
As a business owner you are the leader of your organization. Sales, staffing issues, accounting, customer inquires, human resources are just a few of the daily duties you have.
Legal issues that may arise from time to time can be overwhelming and may make you lose focus at the task at hand which is the growth of your business. Having a Business or Corporate Lawyer representing you for legal issues is an investment for your company.
We offer the following business services:
- Incorporations and re-organizations;
- Start-up Representation
- Asset Purchase Agreements
- Shares Purchase Agreements
- Contracts
- Partnership Agreements
- Buy-Sell Agreements
- Franchise Legal Representation
- Commercial Lease Reviews and Negotiations
- General Contract Review and Preparation
- Stock Purchase Agreements
- Commercial landlord and tenant issues and leasing;
- Employment agreements;
- Commercial real estate purchases/sales;
- Not-For-Profit corporations;
- Partnership agreements;
- Professional corporations;
- Shareholders’ agreements;
- Supply and services contracts.
- Intellectual Property
Business FAQ
What is Business Law?
Also known as commercial law, business law governs the dealings between people and commercial matters. A great part of business law will involve avoiding problems that can cause future legal disputes for an owner. It has been proven that more times then not when a small business owner handles their own legal matters that mistakes are made which can be extremely costly to the owner.
What Type of Business Structure Should I Choose for My Small Business?
When starting a small business, it is essential to choose a business structure that best suits your needs. There are generally three main types of business structures to choose from.
Sole Proprietorship: This is the simplest business structure. You will automatically be considered to have a sole proprietorship if you conduct any business activities. This structure does not require any registration (apart from registering a trade name in certain circumstances) and is best for people who engage in low-risk business activities.
Partnership: When two or more people own a business together, they will be considered to have a partnership. There can be Limited Partnerships and Limited Liability Partnerships.
Corporation. If you incorporate your small business provincially or federally, you will have formed a corporation. Corporations offer more protection to their owners from personal liability.
It is always best to seek advice from a lawyer to see which business structure is best for you.
Do I Have to Incorporate My Business?
You are not legally required to incorporate your business. If you do not, you will be considered to have a sole proprietorship. However, incorporating your business will provide you with many benefits and protections.
Through incorporation, a business becomes its own “separate legal entity”. At law, this means that the business is distinct from its shareholders, directors, and officers. This status allows the corporation to enter into contracts, buy, hold, and sell property in its own corporate name, and sue as a corporation. Most importantly, being a separate legal entity affords the shareholders, directors, and officers protection by limiting their personal liability in the event that the corporation is sued or is faced with other legal issues. In contrast, a sole proprietor opens their personal assets to liability if their business is ever sued.
Should I Incorporate Provincially or Federally?
If you plan to operate within a single province, you may choose to incorporate provincially. However, incorporating federally may be a good choice for individuals whose business operates on a national or international level. Federal incorporation will also afford your business the right to conduct business anywhere in Canada, with no restrictions between provinces.
Federal incorporation also offers heightened business name protection as Corporations Canada undergoes scrutinous checks to approve the company’s trade name. Once the name is approved, it is protected nationwide.
Furthermore, the cost to incorporate tends to be lower on a federal level in comparison to provincial incorporation. For example, as of 2022 federal incorporation costs $200 while incorporation in Ontario will cost $300.
On the downside, a federally incorporated corporation must file annual documents with Corporations Canada as well as with the province they primarily operate in.
What Kind of Registrations and Documents Do I Need for My Business?
There are a certain number of documents you require to form and then govern a corporation.
Name Search Report. This report is required to ensure to your business name is not similar to an existing business name or trademark. This is a pre-requisite to incorporating in Canada and in the province of Ontario.
Articles of Incorporation. These are documents that are filed with the government to legally form your corporation. They set out your business’s purpose, and regulations, and identify its members.
By-laws. By-laws are created by the corporation to set forth how the corporation will be governed. By-laws typically cover topics such as director meetings, voting rights, and stock transfer. You may add your own clauses into the by-laws as well.
Shareholder Agreements. Shareholder agreements are not mandatory but are useful contracts entered into by the shareholders to outline the rights and obligations between each other.
Should I Start a Non-For-Profit Corporation or a Charity?
While corporations are usually created with a goal to make profit, you may also find not-for-profit corporations. The legal aspects of not-for-profit corporations are the same as for regular corporations, however, a not-for-profit corporation must additionally operate solely for the purposes of social welfare, civic improvement, pleasure, and/or recreation. While it may earn a profit, this may not be its primary goal.
A charity is similar to a not-for-profit corporation, however, to be considered a charity, the charity must meet 3 additional criteria. It must (1) exclusively dedicate its property, (2) for a charitable purpose, (3) that is for a public benefit.
A charitable purpose must be the relief of poverty, the advancement of education, the advancement of religion, or any purpose beneficial to the community. The charity must be 100% charitable, 99% is not sufficient.
How Do I Select A Business Name?
It is vital to choose a unique and memorable corporate name prior to incorporation as the name is a representation of you and your business’s practices and standards. Although you may already have a name in mind, you should be aware that the name must conform to several requirements in order to be accepted during the incorporation process.
In Canada, your corporate name must not be the same as or similar to an existing corporate name. The name must also consist of three elements including (1) a distinctive element, (2) a descriptive element, and (3) a legal ending.
The distinctive element refers to the unique part of the corporate name which separates it from all other corporations. The descriptive elements may refer to the business activities carried on by the corporation. The legal ending must be a term such as Inc., Corp., or Ltd.
For example, if you have a flower shop with the name “Sadie’s Flowers Inc.”, the word “Sadie’s” is distinct, “Flowers” is descriptive, and “Inc.” is the legal ending.
How Do I Know If My Contract if Enforceable?
Contracts are a common part of our everyday lives. We sign contracts on a daily basis, whether it is clicking the box to accept the terms and conditions on a website or signing an agreement to purchase a home. In either case, the contract must be valid to be enforceable. A valid contract should have 5 criteria:
Offer. You can make the offer explicitly, such as in writing, or implicitly, such as by your actions.
Acceptance. Your offer must be accepted for the contract to be valid. You cannot force some to accept your offer.
Consideration. Consideration is a legal term referring to an exchange of value between the parties to the contract. This may include money or services.
Intention. Both parties to the contract must have entered into the contract voluntarily, not through coercion or under duress.
Capacity. Each party must be capable to enter into the contract. Being a minor or mentally incapacitated would typically make the contract invalid and unenforceable.
What is the Difference Between a Commercial and Residential Lease?
A residential lease is typically made between a landlord and an individual tenant for the purpose of providing a living space and a home for the tenant. In contrast, a commercial lease is created between a landlord and a business. While these leases both govern the renting of a space or property, commercial leases tend to be more complex and require a more thorough examination. Here are some differences between residential and commercial leases you should be aware of:
Unlike residential leases, commercial leases are typically subject to fewer consumer protection laws.
While residential leases tend to be created from standard form agreements, commercial leases are usually customized to fit the landlord’s needs. Thus, it is essential that you examine the contract to ensure there are no hidden terms.
Commercial leases often bind the tenant to a longer term. While a residential lease typically binds a tenant to a 1-year contract, a commercial lease may outline a term of 5 years or more.
Commercial leases are usually subject to more negotiation as both the landlord and the business want to include their own special terms that fit their needs.
What Terms Are Necessary For A Commercial Lease Agreement?
Leasing a space for your business is a large undertaking as the success of your business often depends on the terms of your lease. Prior to signing a lease with your landlord, you should ensure that you are well protected. Here are some critical terms to look out for before signing a commercial lease agreement:
– When and how you can terminate your lease and any notice requirements
– Length of your lease
– Cost of rent and rent increases
– Are there any additional costs such as property taxes, utilities, maintenance, etc., and who will pay for them
– Security deposit
– Allowability for improvements or modifications on the property, and any responsibility to take them down
– Assignment and subletting terms and allowability
– Options to renew the lease
– How disputes will be resolved
Do I Need A Lawyer to Prepare My Commercial Lease Agreement?
If you are starting a new business, you may want to rent a commercial space to operate in. Oftentimes, businesses believe that signing a commercial lease a simple process and that doing so without a lawyer will save them time and money. Unfortunately, this misconception actually leads to the opposite result. Commercial leases can be complicated and filled with legal and financial technicalities.
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