Recently, in California-American Water Company v. Marina Coast Water District, a California court of appeal found prevailing parties could recover attorneys’ fees based on a void contract under Code of Civil Procedure section 1717 (“section 1717”). The non-prevailing party challenged the trial court’s award of attorneys’ fees, posing the question, “How can an attorney fees provision in a contract govern the parties’ fees obligations when the contract itself is deemed to have been void...

Previously on our blog, we described what information members of a corporation’s Board of Directors can rely on in discharging their duties and explained how they can use the Business Judgment Rule ("BJR") as a defense to liability imposed in the event of an alleged breach of their duty of care. The use of the BJR as a defense by directors creates an obstacle to shareholders attempting to hold directors personally liable for a...

Ezer Williamson Law proudly announces the addition of Robert C. Hayden as Senior Counsel. Mr. Hayden brings with him over 37 years of legal experience and expertise in the areas of labor and employment law, as well as extensive experience in business and commercial litigation, including contract and intellectual property disputes. Prior to joining Ezer Williamson, Mr. Hayden was a partner at RG Lawyers LLP where he practiced for over six years representing both employees and...

We have previously written about doing business in California, and how the California Corporations Code uses a “transacting intrastate business” test.  Importantly, if a corporation or other entity is deemed to be doing business in California under the “transacting intrastate business” test, that entity must obtain a “Certificate of Qualification” under Corporations Code § 2105.  This post will look at what will and will not constitute “transacting intrastate business.” Transacting Intrastate Business Transacting intrastate business means that...

Previously on our blog, we discussed how more complex contracts allude to other existing contracts and documents. Incorporation by reference is the method of making these alluded-to documents part of a contract, and is often used to save space when parties want to include or reference another legal document or contract into a new contract. To properly incorporate another document by reference, it has to be adequately described in a new contract, and it...

If a party was dishonest about a material fact during the drafting process of a contract, the other party may be able to take the contract to court and argue that it should be rescinded, or cancelled, due to misrepresentation.  Moreover, if the honest party performed the contract because he, she, or it justifiably relied on the misrepresentation in a contract of material fact, he, she, or it may be able to collect damages...

There are many reasons to invest in a business, such as joining a new startup, or becoming part of an established and successful business poised for more growth.  Sometimes these new or established companies just need a little additional working capital to be successful.  Before committing, however, it is important to approach the opportunity with objectivity, weigh all investment considerations, and understand the risks and goals associated with the potential investment. First, assess whether your...

Whether you are drafting a contract or reviewing one before signing it, it is important to understand the significance of a Forum Selection Clause. Although you may never need to use it, in the event of a dispute a Forum Selection Clause may become critical. A forum selection clause is a provision in a contract in which the parties agree that any litigation resulting from that contract will be initiated in a specific forum. In other words, it...

Disputes between business partners often center on issues of money and control. As common as business partnership are, they can be quite difficult to sustain. Partnerships between any number of people often entail complicated relationships, which lead to conflicts within partnerships. Most issues between partners do not necessarily mean that the entity should be dissolved, liquidated, and split-up.  Rather, the problems can be solved with a collaborative approach and the relationships preserved. Concerns about control...