by Gahram Kang, Esq.

(adapted from a presentation to FUSION Leaders, Anaheim chapter on July 13th, 2021)

Here at Avodah Law Group, we believe that the Bible contains wisdom not only for our lives, but also for business as well. Based on these Biblical principles, we wanted to share three (3) PITFALLS TO AVOID that we hope is useful and practical for anyone in business, whether you are a business owner yourself or you advise/ assist other business owners.

“People may cover their hatred with pleasant words, but they’re deceiving you. They pretend to be kind, but don’t believe them. Their hearts are full of many evils. While their hatred may be concealed by trickery, their wrongdoing will be exposed in public.” ~ Proverbs 26:24-26

1) Doing Business with Questionable Characters – Normally, we do business with people we like and people we trust. But sometimes, out of the goodness of our hearts, even though there are alarms going off in our heads, and red flags waving everywhere, we decide to give someone a chance to prove us wrong, because we felt sorry for them. Those inevitably end up costing us the most – it could be a customer, an employee, a business partner or even a vendor, but whatever role they play, they end up betraying your trust, demanding something they feel entitled to, consuming your time & energy, and ultimately becoming an expensive lesson that you wished you had learned before you met them. The longer you’ve been in business, the more likely you have had experiences like these at least once or twice.

Takeaway: Let’s learn our lesson and listen to your gut (for us as believers, that’s the indwelling Holy Spirit speaking to you) telling you to turn away from this “business opportunity” and instead do business with people that we can trust.

Food For Thought: Reflect upon an experience when you took on a client or employee against your better judgment. What did it end up costing you?

“When there is no counsel, the people fall; But in the multitude of counselors there is safety.” ~ Proverbs 11:14

2) Trying to be DIY expert at the highest level – DIY legal services or tax services instead of delegating, listening to advice and letting experts be experts Now, I’m not saying that there aren’t certain things that we can DIY successfully and save some money along the way, like I’ve helped my friends paint their oldest son’s nursery room before he was born BUT as things get more specialized, like legal services, electrical wiring or other types of services that could have extremely negative consequences if you do it wrong – is it really worth the risk? (My favorite clients are the business owners who are really good at their specific business but also wise enough to trust others to be experts over other areas.) For example, my partner Andrew recently looked into the Terms & Conditions on LegalZoom’s website because we were wondering why some of our clients used their services and then ended up coming to us to FIX those very same formation documents or contracts after the fact, since they were missing very important clauses or stated some terms that were contrary to the client’s intentions. He found that it states on their website that you are “your own attorney”, that you are using their services “at your own risk”, and that LegalZoom is not liable for any bad consequence of you using or depending on their legal documents or services (!) On top of that, since there is no attorney-client relationship established, there is also no confidentiality obligation that LegalZoom has to keep your information private. [Last month, we released an article where Andrew warns consumers about the “fine print” that they don’t understand when LegalZoom leads them to believe that they can be their own lawyer.]

Food for Thought: Reflect on an experience when you or someone you know tried to perform the services of a professional, just to save money; instead of hiring one. Ex. fixing your own car instead of going to a mechanic, crack your own back instead of going to a chiropractor, etc.

“Or suppose you make a foolish vow of any kind, whether its purpose is for good or for bad. When you realize its foolishness, you must admit your guilt.” ~ Leviticus 5:4

3) Not Reading the Contract Before You Sign It – I’m sure that none of us have ever knowingly signed a contract that we didn’t read thoroughly in advance, but then again, does anyone ever really read all of the fine print, especially in your commercial leases? OR sometimes you get so focused on the major terms of a business deal that you are excited about, that you gloss over the other minutia, never dreaming that there could be critical provisions in there that will come back to bite you later. Unfortunately, after the worst case scenario occurs, “I didn’t know it said that” is not a valid excuse when you’re being held accountable for a specific contract provision.

Takeaway: The good news is that even if you have signed business contracts that you haven’t read, it’s not too late to review them NOW, before something terrible happens that makes those minor provisions significant. If you at least read the contract now, you can determine what your rights and obligations are, and before certain situations arise, you can plan ahead and protect yourself knowing what you need to brace yourself for. (Note: especially after the unexpected COVID-19 pandemic hit, a lot of people were looking to get out of their contractual obligations, whether it was commercial leases or other business transactions, and there are certain defenses that would have been good to know about, such as if the contract itself had a “force majeure” clause versus trying to claim other defenses like impossibility, impracticability or frustration of purpose.)

Practical Tip: Go back and REVIEW all of your contracts now, whether they are commercial leases, loan agreements, business partner contracts, vendor agreements, etc. Check for dispute resolution clauses (does it mention arbitration or waiving your right to a jury trial?), termination or default/breach (what is considered an essential obligation that you may be breaching if you don’t read this), and governing law & venue (are these contracts governed by California law or the law of another state or country?) Sometimes the parties’ names aren’t even spelled correctly or their legal names weren’t used (!)

“Choose a good reputation over great riches; being held in high esteem is better than silver or gold.” ~ Proverbs 22:1

BONUS Tip: Remember to Protect Your Brand (IP) – it sounds crazy to think that anyone would knowingly do business while exposing their most precious possession (their company’s IP) without protecting it, but we do it all the time! After you come up with a brilliant company name or creative product name, and you start selling goods or services using that name, don’t forget to protect it from someone else copying your idea!

Takeaway: It costs nothing to utilize the “TM” symbol to claim your common law trademark, and the © symbol to copyright written materials, AND you’d be surprised at how little it costs to actually register your trademarks (so that you can earn the ® symbol) or to register your copyright, especially when you consider how valuable your brand / name truly is to your business.

As you continue to operate your business and do what you do best: provide quality products and services to your customers and clients, we wanted give you practical tips to help you so that you can stay in business for years or even decades to come. May God bless you & pour out His favor on you!

Gahram Kang is the Founding Partner of Avodah Law Group, a business law firm that serves small to mid-sized businesses in a variety of industries from retail and restaurants to e-commerce and professional practices. For more information on Gahram, please check out her full bio here.