DISCOVERY 101 – RESPONDING TO REQUEST FOR ADMISSIONS

1.  TIME LIMIT FOR RESPONDING TO REQUEST FOR ADMISSIONS:

You have 30 days from the date of service to respond to Request for Admissions. Check the Proof of Service to determine the date the Request for Admissions were sent to you. You can request an extension of time to respond, but make sure you confirm any extension in writing. Unless the extension specifically states otherwise, an extension of time preserves your right to respond with an objection.

The effect of a late response can mean that all of the requests will be deemed admitted. For example, the request for admission can say “Admit that you have no defense.” If you fail to respond to that request, the other side can motion that the request be deemed admitted. You may also be subject to sanctions. If you think you will need more time, then call the other side to request an extension or file a motion to request that the court grant you an extension.

2.   WAYS TO RESPOND TO REQUEST FOR ADMISSIONS:

You must respond separately to each request. You cannot say “see above” or “see response to request number 1.” Those are unacceptable responses.

(A)  You must admit, deny, or object to each request.

(B)  You can partially admit or deny portions of the request.

(C)  You can also state that you lack sufficient knowledge or information to admit or deny the request. However, if you choose state you lack sufficient knowledge or information, YOU MUST ALSO STATE WHAT EFFORTS YOU MADE TO OBTAIN THE REQUISITE KNOWLEDGE OR INFORMATION. You cannot use that response as a way out of properly responding.

HINT: Sometimes requests are strangely worded. Look at the request and ask, “Is this statement true or false?” If it is true, admit the request. If it is untrue, deny the request. If part of it is true, admit that part that is true and deny the rest.

You do not have to retype the entire request out when you respond, but it makes it a lot easier to read if the request is typed out and followed by the response.

CHECKLIST FOR RESPONDING TO REQUEST FOR ADMISSIONS:

Step One: Identify who the responding party is.

Step Two: Identify who the propounding party is. (Propounding means the party that sent you the requests).

Step Three: Respond in writing: admit, deny, partially admit or deny, object, or state lack of sufficient knowledge or information.

Step Four: Identify which set number of requests for admissions you are responding to.

Step Five: Respond to each request separately. Identify using the same number of the request you are responding to. The text of the request does not need to be repeated; however, I feel that it is courteous to do so.

Step Six: Verify your Response.

This checklist is based upon the California Code of Civil Procedure Section 2033.210-2033.230.

For more information on Request for Admissions please click here.

Disclaimer: The contents on this blog are informational only and not meant, intended, nor should be considered legal advice, advertisement, or solicitation for business. The material posted on this blog is not intended to create, and receipt of it does not constitute, a lawyer-client relationship, and readers should not act upon it without seeking professional counsel.

Furthermore, the information contained on this blog is not specific to any particular set of circumstances. All links to outside information are meant to provide further information on the topic addressed, I make no warranties, express or implied, as to the accuracy of the information contained herein or in the attached links.

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Fashion Law Friday: Cottage Industries and the Myth of the $100 Startup

  FashionDesignerwithColleagues       

I am currently working with two small businesses, one makes accessories and the other makes dresses. I don’t want to discourage either of their enthusiasm, but both entrepreneurs were operating under the myth that they could start-up their businesses for a mere $100.00. Every cottage industry handicraft business needs to know, if the business wants to sell products and operate legally in the state of California, it is going to cost more than $100.00.

Here, are some costs my client Sally is facing right from the start, and this is exclusive of the costs to actually make her accessories.

Business Permits and Home Occupational Permits

Sally will need a business permit for the city she is based out of. Business permits in the Inland Empire counties run from $50-100. Sally plans to run the business from her home so she will need a home occupational permit. Home occupational permits in the Inland Empire counties run from $25-200.

Fictitious Business Name

 If she plans on using the cute name she has chosen for her business, she will need to obtain a fictitious business name. The fee in San Bernardino county is $45.00, but that does not include the cost of newspaper publication, which is approximately $50-$200.

Business Entity Registration

If she wants to protect herself from liability, she will need to form a limited liability company or corporation. The filing fee for a limited liability company, which has fewer formalities, is $90.00. Then add to that the $800 Franchise Tax Board minimum for each year her business is in operation.

Seller’s Permit

To operate legally she will need to obtain a tax identification number and obtain a seller’s permit from the Franchise Tax Board. To keep track of money she receives she will also need to open a separate bank account to track the money from sales and sales tax received on her products.

Marketplaces

A. Craft Stall: Stalls at local farmer and craft markets can cost up to $100.00 or more.

B. On-line Marketplace: There are posting fees on most handmade marketplaces.

C. Website: Setting up a website that is going to be seen and is optimized takes money, or a lot of know-how and time. There are also fees to register a domain name. There are fees to set up on-line shopping carts. (There are great services that keep those costs minimal.)

Businesswomanonphone

CHECKLIST OF STARTUP COSTS

1. Fictitious Business Name: $45.00

2. Publication of Fictitious Business Name: $50.00

3. Business Permit: $50.00

4. Home Occupational Permit: $25.00

5. Limited Liability Company Registration with Secretary of State: $90.00

6. Minimum Franchise Tax Board Tax: $800.00

7. Costs of Opening a Bank Account for the Business: $100 (minimum deposit)

TOTAL: $1,160.00

This does not include trademark registration with the State of California or the United States Patent and Trademark Office.

I am not trying to discourage anyone or cause anyone to despair trying to begin a small fashion line of clothing, accessories, t-shirts, or other handicraft products. However, I am trying to dispel the myth that it can be done legally for a mere $100 bucks.

So what should the strategy be for a startup handicraft business? Save, Save, Save money! You can obtain a low-interest loan from the Small Business Administration. You can borrow from friends and family if there are no strings attached to those loans. Keep experimenting with products while you save!

The key thing is to plan to take your business seriously from the beginning. Plan the start-up costs. Plan the maintenance costs. Plan for your success from the get go!

Disclaimer: The contents on this blog are informational only and not meant, intended, nor should be considered legal advice, advertisement, or solicitation for business. The material posted on this blog is not intended to create, and receipt of it does not constitute, a lawyer-client relationship, and readers should not act upon it without seeking professional counsel.

Furthermore, the information contained on this blog is not specific to any particular set of circumstances. All links to outside information are meant to provide further information on the topic addressed, I make no warranties, express or implied, as to the accuracy of the information contained herein or in the attached links

Fashion Law Friday: Online Marketplaces for Indie Designers

          This post is for all the indie designers who have asked me to help them pick out an online selling platform. I cannot tell you what I personally think is the best or the worst platform. Each has their pros and cons. I have created a list with basic information on some of the platforms available to indie sellers.

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Remember that even online sellers must meet federal, state, and local business laws. Online sellers in the State of California are at least required to have local business permits and a seller’s permit from the California Board of Equalization. Read more about licenses and permits here and here!

LIST OF ONLINE MARKETPLACES FOR INDIE DESIGNERS

ETSY

  • Address: www.Etsy.com
  • Listing Fees: $0.20 USD
  • Transaction Fees: 3% to 3.5% (may include additional processing fees)

ARTFIRE

MEYLAH

ECRATER

SPOONFLOWER

  •  Address: www.Spoonflower.com
  • Commission: Seller earns 10% commission fee if his design sells
  • Limitations: Fabrics, Wallpaper, and Decals only      

ZIBBET

  • Address: www.Zibbet.com
  • Fees: Free Account w/50 item limit; Premium $9.95/month or $79/year

BONANZA

GOODSMITHS

  • Address: www.goodsmiths.com
  • Listing Fee: None
  • Transaction Fee: 2.5%
  • Monthly Fee: Free for 25 items; Classic Package $5/month        

HANDMADEARTISTS

  • Address: www.handmadeartists.com
  • Listing Fee: None
  • Transaction Fee: None
  • Monthly Fee: $5/month or $50/year      

Please be advised this is not an exhaustive list. If any reader is using a selling platform and absolutely loving it, please post a comment with the address, fees, and why you have chosen to use that particular selling platform.

There are so many different marketplaces out there and each promises a new and improved experience, or lower fees, or no fees, etc… Just be aware that no matter where you decide to sell your items, you still need to spend the time marketing and developing your products. No marketplace, however optimized, can do that for you.

Disclaimer: The contents on this blog are informational only and not meant, intended, nor should be considered legal advice, advertisement, or solicitation for business. The material posted on this blog is not intended to create, and receipt of it does not constitute, a lawyer-client relationship, and readers should not act upon it without seeking professional counsel.

Furthermore, the information contained on this blog is not specific to any particular set of circumstances. All links to outside information are meant to provide further information on the topic addressed, I make no warranties, express or implied, as to the accuracy of the information contained herein or in the attached links.

Discovery 101 – Responding to Demand for Production of Documents

Lady J

1. What is the time limit for responding to a Demand for Production of Documents?

          You must respond to a demand for production of documents within 30 days of service. That time is extended if the document was sent through the mail, overnight delivery, or fax.  (C.C.P. 2031.260.) Check the date next to the signature on the last page of the document. That usually will give you the date it was served. Sometimes there is a proof of service attached that is different from the date and signature on the last page. If a proof of service is attached (and it should be), check the date on that document to find out when the clock started to run.

 The response is not filed with the court. (C.C.P.2031.290.)

2. What are the ways to respond to a Demand for Production of Documents?

            You can respond in writing and produce all of the documents the other party asked for, you can produce some of the documents and object to others, or you can write a motion for a protective order.

            You are only required to produce the documents “as they are kept in the usual course of business, or be organized and labeled to correspond with the categories in the demand.” C.C.P. 2031.280.

            HINT: Even if you keep your documents thrown into a shoe box, it is not the other side’s job to dig through and organize your mess. If your docs are a mess, organize and label them so the other side knows what request you are responding to.

            HINT: Do not think that if you roll up to their office with a shipping container of documents that you are actually responding. You need to identify what documents respond to which request. That kind of “have at it” attitude may land you with sanctions. So BEWARE!

            The response can contain the following three options: a statement of compliance, a statement of inability to comply and the reason for the inability to comply, or a statement of objection.  (C.C.P 2031.030, 2031.210, 2031.220.)

            I am not going to list all of the possible objections available to you because too often people abuse objections to get out of complying. There is a liberal policy favoring discovery so if you are self-represented and do not actually understand an objection, please do not copy and paste objections from the internet so you can avoid responding to valid requests.

            HOWEVER, if you honestly believe the documents requested are confidential or somehow private I would suggest contacting an attorney or going to your local law library so that you can fully understand any objections or privilege claims you intend to make.

4. What are the consequences if you do not respond to a demand for production of documents?

          You waive all objections. You risk a motion to compel. You risk sanctions. If you need additional time to respond, call the other side and request and extension or put a request for an extension in writing. Do not abuse the extensions you are given, but make every attempt to respond! Eventually the other side may tire of giving you extra time without seeing results.  (C.C.P. 2031.300.)

CHECKLIST FOR FORMATTING RESPONSES TO DEMAND FOR PRODUCTION OF DOCUMENTS

If you have no basis to move for a protective order and no grounds for objection, then follow the checklist below for preparing your response:

Step One: Respond in writing. Whether you intend to respond with a statement of compliance, partial compliance, objections, and/or direct them to a third-party who has the item they are requesting. If something does not exist, say so. If it never existed, say so.

Step Two: Identify who the responding party is.

Step Three: Identify who the propounding party is. (Propounding means the party that sent you the demands).

Step Four: Identify which set number of demand for production you are responding.

Step Five: Respond to each demand separately. Identify using the same number or letter of the demand you are responding. The text of the demand does not need to be repeated; however, I feel that it is courteous to do so.

Step Six: Verify your answer. (Sign it and attest that the foregoing is true and correct.)

Step Seven: Prepare a proof of service and either mail or personally deliver your responses. Make sure that they will still arrive on time if you send them in the mail. Keep a copy for yourself!

This checklist is based upon the California Code of Civil Procedure Sections 2031.210-2031.320. For information on preparing demand for production of documents, please see my earlier blog post here.

by Attorney Judith Elaine Hoover on 03/02/13

Disclaimer: The contents on this blog are informational only and not meant, intended, nor should be considered legal advice, advertisement, or solicitation for business. The material posted on this blog is not intended to create, and receipt of it does not constitute, a lawyer-client relationship, and readers should not act upon it without seeking professional counsel.

Furthermore, the information contained on this blog is not specific to any particular set of circumstances. All links to outside information are meant to provide further information on the topic addressed, I make no warranties, express or implied, as to the accuracy of the information contained herein or in the attached links.

Partnerships 101

 

This will be the first post in a series regarding partnerships. First, I will begin with an overview of what a partnership is and how it is formed. The next post in the series will address partnership agreements. Stay tuned!

1. What is a partnership?

A partnership is when two or more persons enter into business together to make a profit. (California Corporations Code Section 16101(9).)

An oversimplified example: If you and your sister decide to open a clothing store together, you would be operating as a partnership.

2. Are there different types of partnerships?

There are two types of partnerships, General Partnerships and Limited Partnerships.

In a general partnership all partners are personally liable for the debts and liabilities of the partnership. In a limited partnership, the limited partners have limited liability and in exchange do not participate in the day-to-day management of the partnership.

3. How do you form a partnership?

General partnerships do not have any formal filing requirements with the Secretary of State. Limited partnerships do have formal filing requirements with the California Secretary of State. The forms can be found here.

4. Benefits of forming a Partnership

Minimal formalities for formation.

-Profits are not double taxed like in a corporate setting.

-Minimal reporting requirements to government agencies.

-Losses can be reported on individual income tax returns.

-No limits on the number of partners.

-Limited partners can enjoy limited liability and make equity investments. The general partners get the advantage of the additional capital without giving up managerial control.

5. Disadvantages of forming a Partnership

-If one partner dies, the partnership may terminate.

-Potential deadlock in 50/50 decision-making situations.

-Personal liability for partnership’s debts and obligations, unless you are a limited partner.

-Limited partners give up management and control for the limited liability, which means they have may have no say in the possible mismanagement of their investment in the partnership.

-Limited partnerships do have formal requirements for formation.

-The pass-through taxation may be subject to self-employment taxes and may increase tax liability at the end of the year.

by Attorney Judith Elaine Hoover on 08/08/12

Disclaimer: The contents on this blog are informational only and not meant, intended, nor should be considered legal advice, advertisement, or solicitation for business. The material posted on this blog is not intended to create, and receipt of it does not constitute, a lawyer-client relationship, and readers should not act upon it without seeking professional counsel.

Furthermore, the information contained on this blog is not specific to any particular set of circumstances. All links to outside information are meant to provide further information on the topic addressed, I make no warranties, express or implied, as to the accuracy of the information contained herein or in the attached links

Discovery 101 – Responding to Interrogatories

 

1. What is the time limit to respond to interrogatories in California?

30 days to respond.

However, there are exceptions. In unlawful detainer actions, the response time is 5 days. The court can order responses in shorter time. You can move to extend the 30 day response time. If you need more time, you can always call the party who served interrogatories for an extension of time to respond.

2. What are the ways you can respond to interrogatories in California?

You can respond with sworn answers or you can move for a protective order. Either response is due within 3o days.

3. What are the consequences for not responding to interrogatories on time?

You waive your right to object and you can no longer produce writings in lieu of written responses.

CHECKLIST FOR FORMATTING ANSWERS TO INTERROGATORIES

If you have no basis to move for a protective order and no grounds for objection, then follow the checklist below for preparing your answer:

Step One: Answer in writing

Step Two: Identify who the responding party is.

Step Three: Identify who the propounding party is. (Propounding means the party that sent you the questions).

Step Four: Identify which set number of interrogatories you are responding to.

Step Five: Answer each interrogatory separately. Identify using the same number or letter which interrogatory you are responding to. The text of the interrogatory does not need to be repeated; however, I feel that it is courteous to do so.

Step Six: Verify your answer.

This checklist is based upon the California Code of Civil Procedure Sections 2030.210-2030.310. For information on preparing interrogatories, please see my earlier blog post here.

by Attorney Judith Elaine Hoover on 08/06/12

Disclaimer: The contents on this blog are informational only and not meant, intended, nor should be considered legal advice, advertisement, or solicitation for business. The material posted on this blog is not intended to create, and receipt of it does not constitute, a lawyer-client relationship, and readers should not act upon it without seeking professional counsel.

Furthermore, the information contained on this blog is not specific to any particular set of circumstances. All links to outside information are meant to provide further information on the topic addressed, I make no warranties, express or implied, as to the accuracy of the information contained herein or in the attached links.

Business Entity 101 – Sole Proprietorship

WHAT IS A SOLE PROPRIETORSHIP?

A sole proprietorship is a business that consists of only one person.  The business and the owner are the same person.

WHAT ARE THE DISADVANTAGES OF A SOLE PROPRIETORSHIP?

The sole proprietor’s assets are at risk for all of the debts and liabilities of the business. A sole proprietor can minimize the risks with insurance, but the liabilities may exceed the insurance leaving his assets at risk.

The ability to raise capital is also very limited. A sole proprietor cannot borrow funds as an investment and remain a sole proprietor.

WHAT ARE THE ADVANTAGES OF A SOLE PROPRIETORSHIP?

There are no corporate formalities. The sole proprietorship does not have to pay the minimum franchise tax that limited liability companies and corporations are required to pay.

HOW DO I TERMINATE A SOLE PROPRIETORSHIP?

A sole proprietorship terminates when the sole proprietor dies or becomes incapacitated. There are no formal procedures for terminating a sole proprietorship.

IF I DO PLAN TO OPERATE AS A SOLE PROPRIETOR, WHAT SHOULD I DO?

1. Buy insurance.

2. You still need to apply for and obtain business permits and applicable licenses.

(For more info on permits and licenses, please visit my previous post here.)

3. You need to report the business income. You will file a Schedule C when you prepare your taxes.

4. Maintain a separate bank account for the business.

by Attorney Judith Elaine Hoover on 06/27/12

Disclaimer: The contents on this blog are informational only and not meant, intended, nor should be considered legal advice, advertisement, or solicitation for business. The material posted on this blog is not intended to create, and receipt of it does not constitute, a lawyer-client relationship, and readers should not act upon it without seeking professional counsel.

Furthermore, the information contained on this blog is not specific to any particular set of circumstances. All links to outside information are meant to provide further information on the topic addressed, I make no warranties, express or implied, as to the accuracy of the information contained herein or in the attached links.