In simple terms, commercial law relates to the rules governing business and commerce. More specifically, and depending on the type of business you run, you will need to understand and comply with a range of laws such as corporations law, employment law, taxation law, and trade and consumer law. Each of these areas can be a speciality in itself, with numerous rules and regulations. Owners and company directors can develop an understanding of these rules from the daily activities of managing their businesses. In many cases, however, these laws can be incredibly complex, and it is wise to seek specialised legal advice.

Corporate Governance and Advisory

Corporate law focuses on the governance and regulation of business, in particular the rules contained in the Corporations Act. The Act sets out strict rules for how you start, run, and close a company. All incorporated entities in Australia must comply with the Act, and company directors have serious obligations to discharge their responsibilities under the legislation. As a person responsible for a company, you have positive obligations and the personal penalties for deliberate breaches of your obligations can be severe.

Whether you are a sole director/shareholder, or the head of a multinational, good corporate governance is essential to operate effectively in a regulated market. We counsel members of the board of directors, the board as a whole, or key executives on a range of corporations law issues including compliance, shareholder communications and corporate best practice. We can assist with:

• Advice on directors’ duties, responsibilities, rights, and protections
• Litigation for breaches of corporations law and directors’ duties
• Advice on directors’ duties on risk oversight and mitigation
• Defending shareholders’ rights
• Succession planning and advice

Corporate Restructures

Whether due to crisis or opportunity, a company restructure may be imminent. You may be looking to raise equity, change ownership arrangements, or refinance your business. The restructure of an organisation triggers a range of considerations, for example, the transfer, termination, or possible redundancy of employees. It is important to flag and effectively deal with these matters. We provide strategic advice to help owners and executives navigate complex and sensitive commercial issues to achieve focused and compliant outcomes.

Buying or Selling a Business

The sale or purchase of a business is often a high-stake transaction, where the terms of the sale can have far-reaching financial consequences. One of the most common scenarios is for the purchaser of a business interest to already be a co-owner. In such cases, it is beneficial if there is a buy/sell agreement in place, as this will dictate how changes can be made to ownership of the business. For instance, an agreement may require that the remaining owner pay a percentage of the value in an original lump sum and the balance in regular repayments. Ensuring that your buy/sell agreement is realistic, flexible, and enforceable is a critical risk management step for anyone who co-owns a business.

Buying a Franchise

A franchise is essentially an arrangement whereby the owner of a branded product or service (the franchisor) assigns to an independent third party (the franchisee) the right to sell that product or service using the franchisor’s brand, marketing, and systems.

The relationship between the franchisor and franchisee continues for an agreed time and, typically, the franchisor will be involved on an ongoing basis to ensure that training, marketing, and management of the business is carried out to an acceptable level. Franchises in Australia are governed by the Franchising Code of Conduct.

Franchises typically involve large capital outlay and ongoing operating expenses. Like any business venture, if you are considering a franchise opportunity, it is important to obtain advice from an experienced lawyer and have your proposed agreements reviewed so you can make an informed decision.

Business and Commercial Contracts

As your business grows, various negotiations and transactions will take place that should be documented in a legally binding agreement. These might include contracts for the provision of goods and services, terms of trade, shareholder agreements, employment contracts, and distribution agreements.

We can draft your commercial contracts from scratch or review and negotiate an existing agreement to flag issues and add provisions to protect your interests and that would otherwise prove very costly. Lawyers generally think outside the box and contemplate what could, and sometimes does, go wrong. A well-drafted business contract puts the parties on the same page from the beginning of their relationship by providing clear terms that balance their rights and responsibilities, and provisions to cover a range of contingencies and to deal with unforeseen events.

Debt Recovery

In a perfect world, you would never have to chase outstanding debts. In reality, however, it is likely that some clients or customers will be slow payers or refuse to pay their invoices at all. The best approach to chasing debts will depend on the circumstances, the identity of the debtor, and the amount owed.

If the debtor is a company, serving a statutory demand under the Corporations Act creates a presumption of insolvency unless the company pays up or successfully has the demand set aside. The debtor company is then at risk of being wound up.

If the debtor is a sole trader or partnership, you might start with a letter of demand or pursue payment through the courts. Depending on the circumstances, there may be room for negotiation, and you could enter into a deed with the debtor for repayment of the debt by instalments.

Corporations operate in a heavily regulated market and laws are continually changing. To remain compliant and competitive, and to mitigate loss and protect interests, it is important to be proactive and check in with your lawyer regularly.

We are experienced corporate lawyers and can assist with a range of standard and complex commercial matters, whether you are starting a new business, restructuring or growing an existing one, or involved in a commercial dispute. We offer practical commercial legal solutions to individuals and businesses across a range of industries.

If you need any assistance, contact [email protected] or call 02 8005 6577 for expert legal advice.