What is Corporate Law
Corporate law is a branch of law that deals with issues and disputes relating to corporations and other businesses. Because a corporation is regarded as a single entity by the law, corporate law involves the organisations themselves, rather than the individuals who run or work for them. This gives corporations a unique kind of status within the law, as the organisation is considered to be distinct from its shareholders, owners, and directors.
Corporate law is for all businesses
While this kind of law is called corporate law, all kinds of businesses can be involved in corporate matters. This includes partnerships and sole traders as well as businesses of all sizes. However, the specific nature of each kind of business does make a difference in how they’re viewed in the eyes of the law. The most significant differences relate to finances: the source of the business’s finance, who profits from the business, and who is liable for its debts.
Note that the distinction of corporations as separate legal entities applies only to public and private companies. The people who own and run sole traders and partnerships are legally liable for the debts those businesses incur; the people who own shares in or run corporations are not.
What do corporate solicitors and litigators do?
Corporate solicitors deal with a wide range of issues relating to businesses of all sizes; for instance, they can:
- Provide legal advice for people who own and run sole traders and partnerships, and public and private companies.
- Help with paperwork and other matters involved in starting a new company.
- Help a small business, sole trader, or partnership with legal issues involved in securing funding.
- Help a corporation list on the stock exchange.
- Act and offer advice in matters relating to corporate restructuring, mergers, and acquisitions.
The role of a corporate solicitor often varies depending on the kind of businesses they typically deal with. For instance, a solicitor who usually works with small businesses, sole traders, or partnerships will likely deal with matters such as helping businesses file paperwork or secure funding. On the other hand, a corporate solicitor is more likely to be involved in legal transactions such as company mergers and acquisitions that involve months of work and potentially millions of pounds.
In corporate law, it’s often the case that a lawyer specialises as a solicitor or barrister, meaning they restrict themselves to working outside or within the court system. Some corporate lawyers may perform both roles, but in corporate law specialisation is the norm.
Methods of dispute resolution
Corporate solicitors may also be involved in litigation and other court processes. Businesses of all sizes can appeal to the courts, or to alternative dispute resolution methods, for a wide range of reasons. Examples include breach of contract, disputes between shareholders and the companies they invest in, and disputes between two or more people or businesses.
There are several different ways to resolve corporate disputes, including arbitration and mediation as well as the court system.
Arbitration is typically the preferred method in corporate law, being similar to a court hearing, but with the advantage of complete privacy. An arbitrator is appointed to decide the case, and the decision they make after hearing the evidence is legally binding.
Mediation is a method in which a mediator helps the disputing parties come to an agreement, but does not make a binding decision.
The court system is the last resort, and is typically appealed to only when a dispute can’t be settled via a more private method. Going through the court system may involve months of costly preparation as well as the trial itself, and most businesses prefer to avoid the publicity that often surrounds corporate cases.