“Economic” Shareholder Rights Shareholders invest in corporations primarily for economic gain or profit.  The two main ways shareholders can profit from a corporation are by receiving distributions of the company’s profits and by selling all or part of their interest in the corporation. These correspond with the two main “economic” shareholder rights: the right to receive dividends and the right to sell shares. Notably, shareholders only have the right to receive dividends as they are declared...

An adhesion contract is also referred to as a contract of adhesion or a standard form contract.  Often times this type of contractual agreement is drafted by one party, and usually looks like a template contract used in all agreements with that party. Adhesion contracts are commonly used for car purchases, cell phone and cable contracts, insurance matters, rental agreements, mortgages, and deeds. In an adhesion contract, the drafting party is usually a business (typically...

Title insurance protects real estate owners and lenders from property loss or damage that could arise from defects in the title to the property, or damages due to liens and/or encumbrances.  Each title insurance policy is different, as each one will have different terms and conditions. For most types of insurance (such as car or health insurance), the insured generally pays a monthly premium to protect against potential future events. With title insurance, the insured...

Intellectual Property Basics It is important to protect the intellectual property and proprietary aspects of any businesses’ goods and/or services.  There are a variety of different ways to go about protecting your intellectual property, and it is important to determine what method will accomplish your goals effectively. It is therefore important to develop an understanding of the different intellectual property protection options. Depending on your company’s needs, you may want to consider either a patent,...

The discovery of mold on rental property usually means costly remediation and litigation between the tenant(s) and the landlord.  However, California is one of the few states that have taken steps toward establishing permissible mold standards.  California's "Toxic Mold Protection Act of 2001" authorizes the state's Department of Health Care Services (“DHCS”) to set permissible levels of indoor mold exposure for sensitive populations, which include children and people with compromised immune systems.  The California law also allows the DHCS...

It is common practice for retailers to search their employees before they leave work. In a recent United States Supreme Court opinion,  Integrity Staffing Solutions v. Busk, the Court ruled that workers do not have a federal right to be paid for the time spent in these post-shift employee searches. This decision will save businesses billions of dollars, including companies like Amazon, who is projected to save over $100 million. In the opinion  the justices unanimously rejected former...

Many business are self-insured, meaning that they provide healthcare plans for their employees. However, because of the high costs associated with this practice, some companies have been paying employees with significant health issues to opt out of company medical plans and get coverage on the insurance exchange market. Recently, a number of federal agencies have said that this practice is illegal under current healthcare laws. From a business perspective, it is easy to understand why...

An indemnification clause is often found in contracts and is designed to protect one party from financial loss, and shift the risks and any potential loss to another party. Usually, the risk of loss is shifted to the party who is in the best position to control and prevent the risk at issue.  While an indemnification clause is a great term to have in a contract to protect parties from certain events, they can...

A common issue that arises in California property law surrounds public coastal access. In September 2014, a California Superior Court judge ruled in favor of coastal access advocates by holding that a property cannot block the only public access route to Martins Beach (located less than an hour outside of San Francisco, California), without permission from the Coastal Commission, and demanding the property owner to open the gate blocking access to the beach. The case,...

Despite the fact that it remains the better and safer practice to put all contracts in writing, many important business and partnership agreements are still made orally.  While oral contracts are enforceable in California in many circumstances, the California Civil Code specifically requires that certain agreements be put in writing to be enforceable. Specifically, California law requires that the following contracts be in writing in order to be enforced: A contract in which performance will necessarily exceed...