STARKVILLE — When Amanda Adkins, owner of Shelter Insurance in Starkville, opened her branch last year, she sought solid legal advice on how to operate certain parts of her business.
In May, she heard about the Greater Starkville Development Partnership’s new B.A.I.L. series consisting of four sessions to teach businesses about banking, accounting, insurance and legal services. She thought it would be a good opportunity to brush up on the legal aspects of her guild.
“I wanted to make sure that from an agency perspective that I have everything I need legal-wise with bringing on staff or making sure I’m covered in that area,” Adkins said.
Adkins was one of 11 who came to the fourth installment of the B.A.I.L. series Wednesday at the Starkville Community Theater downtown.
Panelists were Starkville-based attorneys Rob Roberson and Steven Adams, and Brandon Jolly with the Mississippi State University general counsel’s office.
During the session, panelists advised on how to set up legal entities, how to plan for uncertain futures and how to protect consumer data.
Roberson said the smartest thing business owners can do when it comes to managing their liability versus that of the company, is to register with the Mississippi Secretary of State’s office as a limited liability company.
Roberson added that owners should keep personal and business assets separate to maintain protection if they are ever sued.
“What that does is give you an insurance policy, basically,” Roberson said. “If you are sued, you’re sued in the context of the business.
My dad used to take his business and pay all of his bills with the money from it. Well, here is the problem with that: you have no protection because you’re treating your business like its personal income.”
Adams told attendees that lawyers can assist in drafting work contracts or purchase agreements when it comes to working with other businesses for special projects.
“The thing to think about when you’re going forward is always draft a contract if you’re doing business with somebody else,” Adams said.
Jolly added that when someone decides to purchase another company, having a lawyer look over the agreement can save money because the buyer inherits any liabilities, such as debt and taxes owed.
“You’re not just buying the asset, sometimes you’re buying the liabilities that come along with it and if there’s debt associated with it, you may be assuming without realizing it,” Jolly said. “It’s good to have that all spelled out when you go to buy.”
Panelists also discussed the need for having cyber security to protect financial and consumer data.
Roberson and Adams said while some businesses don’t always need iron-clad firewalls, companies that deal with financial information, Social Security numbers and other sensitive data could be liable for suit if they dont take measures to protect it.
“If it’s not real sensitive, you don’t have to be as concerned,” Adams said. “If you’re talking about bank accounts and Social Security numbers and things like that, that can rack up scrutiny on you with the risk you’re taking on. If you’re taking a lot of that information from your customers, I would suggest going and talking to your insurance broker about coverage that will cover you in advance of that happening.”
Jolly said as time goes on and businesses grow, owners may need to consider forming a legal framework for successors if they are ever incapacitated.
“We don’t want to ever think about those things, but when things happen, and they’re going to happen, (not having that) creates even more burden on your family members, or whoever is there to pick up the pieces,” Jolly said. “So try to account for that.”
Another attendee, Brittany Goss, owner of online marketing agency Bootstraps and Butterflies, said she came to learn more about cyber security and legal services.
“I have a digital business and you don’t necessarily know because everything is intangible,” Goss said. “So, knowing how to pass that down legally and the responsibilities that come with that has been beneficial.”
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