Pearson Butler Carson & Cook

Utah enacts new LLC law – Effective July 1, 2012

geoff — Wed, 25 Jan 2012 18:11:22 +0000

Upcoming changes to Utah LLC law are coming this year. The legislative changes takes effect for all new LLCs formed after July 1, 2012 and existing LLC will have the opportunity to opt-out until January 1, 2014. The major changes are highlighted as follows taken in part from the revised Utah Limited Liability Company Act (U.C.A. 48-3-100, et seq.) :

1. If an Operating Agreement is not adopted at formation, the new LLC will default to the statute. The statute allows that operating agreements can be oral, memorialized in one or more writings, or established through course of conduct, or any combination thereof. In other words, when a partner says to another, “You can have 30%” and it is never documented, said partner may rely on the discussion and establish a binding Operating Agreement .

2. The new laws do not require public disclosure of names and addresses of the members or managers, a business purpose, or the name and address of anyone not an organizer. This allows the owners to maintain some anonymity and keep personal information off the public record.

3. Our new LLC law will set forth with specificity the duties of loyalty required by managers or members. While that may increase concerns about personal liability, again, the operating agreement will be the defining document to state any exceptions to those duties and can be modified as the company requires.

We always recommend new business ventures negotiate and determine the terms of an Operating Agreement at the outset of the venture. However, most clients–out of budgetary concerns–decline. To illustrate, I have a client who did not create an Operating Agreement , he formed his LLC by himself, and then added a partner at 50%. Aside from mistakes in the Articles of Organization, he also verbally agreed with a new third partner for 30% and the second partner reducing to 20%. We were able to, at that time, eventually negotiate the third partner out of the company because there were no documents proving his ownership. He had never signed an Operating Agreement. For a new company formed after July 1, 2012, that same third partner could use the verbal statements to establish his ownership.

At Pearson Butler Carson & Cook, we focus our work on business owners and inventors, setting up new companies, and drafting Operating Agreements to suit the needs of the business owners.

When Debt Collectors Go Too Far!

jbutler — Fri, 13 Jan 2012 21:33:16 +0000

Although most bill collectors are careful to follow the law when contacting you, some are not. If a bill collector goes too far, you can take action.

THE FAIR DEBT COLLECTION PRACTICES ACT

The federal Fair Debt Collection Practices Act, or FDCPA (15 U.S.C. § 1692 and following), prohibits debt collectors from engaging in abusive behavior.

The FDCPA covers debt collectors who work for collection agencies. It does not cover debt collectors that are employed by the original creditor (the business or person who first extended you credit or loaned you money).

If a debt collector that works for a collection agency breaks the law, you can take steps to make sure it doesn’t happen again.

WHAT DEBT COLLECTORS CAN’T DO

Debt collectors from collection agencies cannot do any of the following:

Call you repeatedly or contact you at an unreasonable time (the law presumes that before 8 a.m. or after 9 p.m. is unreasonable).
Place telephone calls to you without identifying themselves as bill collectors.
Contact you at work if your employer prohibits it.
Use obscene or profane language.
Use or threaten to use violence.
Claim you owe more than you do.
Claim to be attorneys if they’re not.
Claim that you’ll be imprisoned or your property will be seized.
Send you a paper that resembles a legal document.
Add unauthorized interest, fees, or charges.
Contact third parties, other than your attorney, a credit reporting bureau, or the original creditor, except for the limited purpose of finding information about your whereabouts. Unless you have asked collectors in writing to stop contacting you, they can also contact your spouse, your parents (if you are a minor), and your codebtors.

WHAT TO DO IF DEBT COLLECTORS BREAK THE LAW

Here’s what you can do if debt collectors engage in illegal activity:

1. TELL THEM TO STOP

Under the FDCPA, you have the right to tell a collection agency employee to stop contacting you. Simply send a letter stating that you want the collection agency to cease all communications with you. All agency employees are then prohibited from contacting you, except to tell you that collection efforts have ended or that the collection agency or original creditor intends to sue you or take advantage of some other legal remedy.

Don’t hide from debt collectors. You can tell a collector to stop calling even if the collector is not breaking the law. However, many debt counselors feel that, unless you’re judgment proof (that is, broke for the foreseeable future) or truly plan to file for bankruptcy, the best overall advice is not to ignore the debt or try and hide from the debt collector. Usually, the longer you put off resolving the issue, the worse the situation and the consequences will become. Whether you negotiate directly with the collector or obtain a lawyer’s assistance, many counselors feel the best strategy almost always is to speak to the collector.

2. DOCUMENT ILLEGAL BEHAVIOR

If a debt collector breaks the law, document the violation as soon as it happens. Start a log and write down what happened, when it happened, and who witnessed it. Then, try to have another person present (or on the phone) during all future communications with the collector.

3. FILE A COMPLAINT

File a complaint with the FTC. File an official complaint with the Federal Trade Commission (FTC), the federal agency that oversees collection agencies. Contact the Federal Trade Commission at 6th and Pennsylvania Ave. NW, Washington, DC 20580 or at www.ftccomplaintassistant.gov. In your complaint:

include the collection agency’s name and address, the name of the collector, the dates and times of the conversations, and the names of any witnesses, and
attach copies of all offending materials you received and a copy of any tape you made.

Send the complaint to state agencies. Send a copy of your complaint to the state agency that regulates collection agencies for the state where the agency is located. To find the agency, call information in that state’s capital city or check the state’s website.

Send the complaint to the creditor and collection agency. Finally, send a copy of the FTC complaint to the original creditor and the collection agency. The original creditor may be concerned about its own liability and offer to cancel the debt.

Once your complaint is filed, don’t expect immediate results. The FTC may take steps to sanction the agency if it has other complaints on record. The state agency may move more quickly to sue the collection agency or shut it down for egregious violations. Your best hope is that the creditor will offer to cancel the debt.

4. SUE THE DEBT COLLECTOR

If you’ve been subject to repeated abusive behavior and can document it, consider suing the collection agency. But if the illegal behavior was merely annoying, don’t bother. For example, if the collector called three times in one day but never again, you probably don’t have a case.

To sue the debt collector, you can represent yourself in small claims court or hire a lawyer and go to regular court. (The other side may have to pay your attorneys’ fees and court costs if you win.)

Money damages. If you win in court, you are entitled to recover:

the amount of any actual financial losses you suffered — for example, your therapy fees, if you suffered extreme anxiety as a result of the collector’s actions, or the amount you paid to switch to an unlisted number to avoid harassment, and
an additional amount (unrelated to actual losses) up to $1,000 for any violation of the FDCPA.

Hostess Prepares to File Chapter 11 Bankruptcy Again

jbutler — Tue, 10 Jan 2012 06:37:07 +0000

The Utah Chapter 11 bankruptcy attorneys at Pearson, Butler, Carson & Cook, PLLC have learned that Hostess Brands, Inc. is preparing to file for Chapter 11 bankruptcy protection, according to news sources. Hostess is best known for its Twinkies and Wonder Bread products.

The company has over $850 million in debt and employs almost 19,000 workers. The tight money supplies and high labor costs are large factors for considering filing for bankruptcy protection. It filed Chapter 11 in 2004 in an attempt to reduce debt and lower costs. The company hopes that the Chapter 11 bankruptcy filing will enable them to renegotiate labor contracts, reduce benefit costs, and raise additional capital to update production and distribution.

The Chapter 11 attorneys at Pearson, Butler, Carson & Cook, PLLC consult with business owners throughout Utah whose business operations are likewise struggling. If your Utah business is struggling and you want to know what restructuring options are available, feel free to call our office at #801-495-4104.

Tooele bankruptcy attorney office opens

jbutler — Fri, 16 Dec 2011 06:24:01 +0000

The bankruptcy attorneys at Pearson, Butler, Carson & Cook, PLLC are happy to announce the opening of their Tooele, Utah office on the corner of Main and Vine. Our experienced bankruptcy lawyers offer Chapter 7 and Chapter 13 bankruptcy protection.

Our Tooele, Utah bankruptcy attorneys have already assisted several Tooele residents file bankruptcy. In the past, however, the Tooele residents would travel to our South Jordan and Layton offices in order to file bankruptcy.

Jeff Butler, one of the partners at Pearson, Butler, Carson & Cook had the following comments: “We have had such a positive experience helping our clients from Tooele that we have chose to open an office to provide a more convenience for people looking to get relief from their debts.”

If you need assistance filing bankruptcy and would like a free consultation with a bankruptcy lawyer or attorney in Tooele, please contact us at #801-495-4104 to schedule a consultation.

Franchise Attorneys in Utah

jbutler — Sat, 03 Dec 2011 18:11:57 +0000

Franchising

The franchise attorneys at Pearson, Butler, Carson & Cook, PLLC helps business owners grow their businesses by franchising. Our franchise attorneys draft disclosure documents and franchise agreements, register franchises, and assist with franchise compliance. Our franchise lawyers represent franchisors, franchisees, companies developing franchises throughout Utah, including Salt Lake City, South Jordan, Layton, and Tooele.

Call a Utah franchise attorney for a free consultation a (801) 495-4104.

Utah Chapter 11 Bankruptcy Attorneys

jbutler — Wed, 30 Nov 2011 07:10:47 +0000

Utah Chapter 11 bankruptcy provides businesses an opportunity to reorganize their business debt to allow them to continue running business operations while allowing for debt servicing.

The Chapter 11 bankruptcy provides debt relief for all types of businesses and becoming more common place as the business sector attempts to recover from this lated recession.

Feel free to talk with a Chapter 11 bankruptcy attorney at PEARSON, BUTLER, CARSON, & COOK, PLLC at (801) 495-4104 for a free consultation.

Bankruptcy Fees Rise

jbutler — Fri, 28 Oct 2011 06:25:19 +0000

when it rains, it pours

The cost of filing bankruptcy just got more expensive, but not by much. On September 13, 2011, the Judicial Conference of the United States Bankruptcy Court has announced an increase in bankruptcy filing fees effective November 1, 2011. The filing fees are paid directly to the court usually in full at the time a debtor’s case is filed. The increase will occur to the following fees for bankruptcy cases:

Filing Fees:
Chapter 7: from $299 to $306
Chapter 13: from $274 to $281
Chapter 11: from $1039 to $1046

Document Amendment Fee: from $26 to $30

The cost of filing bankruptcy may have increased $7.00; however, for many debtors the benefits of filing for bankruptcy still greatly outweigh the costs.

Is Your Student Loan Debt Dischargeable?

jbutler — Thu, 06 Oct 2011 15:59:18 +0000

Friends, this is the question every college, vocational, masters program, state college, or other grad asks at some point when they look at the balance on their student loan debt.

Chances are, the answer is “No.” If you received a loan from someone that paid directly to an educational institution, you have a most likely non-dischargeable student loan debt. Several amendments and changes to the Bankruptcy Code (Title 11 U.S. Code) have made discharging your education debt nearly impossible.

The Bankruptcy Amendments and Federal Judgeship Act of 1984 made private student loans from all nonprofit lenders excepted from discharge, not just colleges, by striking the words “of higher education”. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 expanded this to include all “qualified education loans”, regardless of whether a nonprofit institution was involved in making the loans. This includes your best friend and mine, Sallie Mae.

However, the applicable Bankruptcy Code section and the corresponding Internal Revenue Code section discuss “indebtedness” and “educational loans,” of which we contend unpaid tuition represents neither. Tuition debts are contractual obligations and are not student loans unless they are supported by a promissory note.

Two relevant cases that discuss this in matter in detail are: In re Kevin Renshaw and In re David Regner, 222 F3d 82 (US Court of Appeals for the Second Circuit, 2000) and In Re: Sandra Ann Chambers, 348 F3d 650 (US Court of Appeals for the Seventh Circuit, 2003), where the court held that unpaid tuition bills were not an education loan and hence could be discharged.

If you find that you owe unpaid tuition, you may be able to find relief under bankruptcy law.

Contact us today to find out if your unpaid tuition or student loans are dischargeable.

Number of College Grads Filing Bankruptcy Rises

jbutler — Wed, 05 Oct 2011 21:26:26 +0000

CNN Money reported recently that an increasing number of college graduates are filing bankruptcy. High education costs, daily living expenses, and prolific credit card applications seem to be the biggest offenders.

If you incurred higher education debt, that is generally going to be non-dischargeable under Bankruptcy law, contact us today to discuss special circumstances under which we may be able to help you obtain relief from your student loan or other debts.

Call us now to discuss relief from your debt under Chapter 7, 13, or debt settlement options. 801-495-4104

For the full story click here!

Chapter 13 Plan Payment Help

jbutler — Tue, 13 Sep 2011 23:06:37 +0000

We get a lot of questions about how do we figure out the Chapter 13 Bankruptcy Plan Payment. Our bankruptcy attorneys are highly trained and capable to answer this question, but in the interest of adding more information to your arsenal, thought this presentation might be of assistance.

Of course, we disclaim the fact that nothing in here creates an attorney-client relationship, so we encourage you to come down to our South Jordan office, our Layton office, or our Salt Lake City office and create that attorney-client relationship so we can give you advice on your specific needs.