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It's a total contract myth that there are 'standard' contracts or contract terms. I've even heard other attorneys improperly stating that parties can not agree to terms because it's not 'standard.' The truth is that contracts are living, breathing documents that can be changed to suit people's needs and as long as the courts or law do not prohibit certain clauses, the parties can agree to it. On the flip-side, just because a contract term is 'standard' does not mean a court will or not will not enforce it and that you can't negotiate the terms. The purpose of this article is explore what people mean by 'standard' contracts, how and when to negotiate those terms, and what happens in court with 'standard contracts.'

What is a 'Standard Contract' or 'Standard Term'?

I typically people refer to 'standard' contracts in two contexts: 1) a company telling a customer to sign terms that 'just standard' and 2) when parties negotiating a contract and insist on arbitrary 'standard' terms. There is in fact no such thing as a 'standard' anything in contract. There are terms common and typical to a specific industry, there may be industry standards that are in contracts, legal requirements for certain transactions, and there are 'boilerplate' terms, but from a legal standpoint, there is no law that requires parties to contract to certain terms. Common industry standards include requiring parties to carry certain types of insurance or expect a certain quality of work, but they are not legal requirements for a contract. There are also legal requirements required by statute, but this does not need be in the contract to be applicable. For example, certain employers are legally required to provide health insurance to their employees. This does not need be included in the contract for it to be effective. Lastly, there are 'boilerplate' terms, which is really just another term for 'common terms.' As I will explain later, using boilerplate terms without consulting a business lawyer or contract lawyer can be a very bad idea.

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By Ronnie Farhat, Esq.

The vast majority of lawsuits in the United States do not go to trial. Litigation is an extremely draining process, both financially and emotionally, for all parties involved. As a result, the vast majority of lawsuits that are filed are ultimately resolved through settlement. Assuming you are already involved in a lawsuit either as the plaintiff (the person who filed the lawsuit) or a defendant (someone who the lawsuit was filed against), here are some of the factors you should consider to determine whether it is appropriate to settle at any given stage of the litigation. This article is perfect if you need to start or are involved in a lawsuit and need a business law attorney, business contract attorney, or business litigation attorney.

What Are Your Goals?

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A common scenario I see: Two or more friends have a grand business idea and file their Articles of Organization for their LLC. They start taking clients and all goes well... for awhile. They start making money and are excited for growth. Then the honeymoon phase is over. The business partners realize one of their comrades is not putting in as much effort but still reaping all the benefits. Or one partner has 'creative differences' with the other partners and the partners are deadlocked in how to grow the company. Conflict ensues and they start to fight over who gets what or how things get done. Ouch.

Problems of Not Having an LLC Contract aka 'Membership Agreement'

So what happens? Or could this have been avoided? Great questions. It is best practice to create a 'membership agreement' between LLC partners. Without the Membership Agreement, the Illinois Limited Liability Act will govern the rules. For example, if a member wants to leave the LLC, the LLC Act will dictate the terms. If, however, the members want to have different terms, they can put it in the Membership Agreement. For example, under the newer LLC Act, that became effective on July 1, 2017, the LLC no longer is required to be buy out a member who wants to leave the LLC. However, the LLC members can write up their own terms in their Membership Agreement such as requiring an LLC to purchase a member's interest or other terms that would dictate a conflict. Because members wanting to leave an LLC is very common, this is very important to negotiate with fellow LLC partners.

Another problem with not having a Membership Agreement are the terms of how profits and losses are divided. As a default according the the LLC Act, profits and losses are allocated based on ownership ratio. So if John and Jane go into business together and John owns 35% of the LLC and Jane owns 65% of the LLC, the profits and losses are split the same way. But if John and Jane want to agree to a 50/50 split instead, they can do that if they write it out in the Membership Agreement. Some LLCs even failed to decide how much the members own and just assume it's an equal split. Another huge failure that LLCs fall into is not clearly deciding what is an 'contribution' and what is a 'loan.' For example, Jane decides that she can give the LLC $10,000 but wants only $3,000 to be her contribution and the remainder she wants back. This is extremely important because if the LLC needs to close up or Jane wants to leave the LLC, whether she gets her money back really hinges on clearly communicating what part of that money is an investment and what is a loan.

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A few weeks ago, a nice woman scheduled a consultation with me and said, surprised, 'I had no idea I could get all of this out of just a consultation!' (She came to me, of course, after knowing how to properly look for a lawyer). ? In my many years of practicing law, it's becoming more clear to me that many people do not understand what a consultation is and all that they can get out of one.

We tend to associate consultations with personal injury lawyers as they tend to typically advertise (a lot) FREE consultations. But did you know that each type of lawyer has a different purpose for their consultations? Personal injury attorneys tend to assess whethe a person has a valid case. After the consultation, there isn't much information or value the attorney can provide after the consultation is over and the attorneys determine that the person does not have a good case. This is simply due to the nature of the claim, not because of any problem with the lawyers themselves.

Other attorneys, like myself, actually provide actionable advice to clients whether they end up hiring me or not. Like in this lovely lady's situation, she needed to know whether her non-compete was enforceable so she could work for a nearby employer. She did not realize she could simply schedule a consultation to ask me some questions with zero intent on hiring me for more services. What did she get out of the consultation? She learned that she could leave a job she was unhappy with and how to handle any threats from the current employer. She said she wished she came sooner prior to signing this contract to get advice if she knew she could do that.

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Posted on in Uncategorized

I don't practice criminal law but I can't help but to dabble in some current news. Since I also live near Chicago, this has become sort of local news to me as well.

The Curious Case of Jussie Smollett

On March 14, 2019, 'Empire' act Jussie Smollett pleaded 'not guilty' on charges that he staged a hate-crime attack against himself in Cook County, Chicago, Illinois. In case you are not aware, Smollett, who is black and gay, told police that he was attacked by two men as he walked to his Streeterville apartment around 2 a.m. that morning. He claimed that his assailants hurled racist and homophobic attacks at home, punched him, and wrapped a noose around his neck. After the attackers, who are brothers, were caught and were in custody for 48 hours, they told police that Smollett had paid them $3,500 to carry out the attack as a hoax in order to raise Smollett's street cred.

A grand jury has indicted Smoll ett for various counts of disorderly conduct regarding his false statements to detectives. So what is disorderly conduct? The Illinois statute 720 Ill. Comp. Stat. Ann. ยง 26-1 et. seq. lays out several categories of disorderly conduct but the most relevant one is probably:

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