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2005 in Review -- Timely Thoughts and Advice

Harford Business Ledger: February 2006

As we begin a new year it seems that the media has been filled with looks back at 2005 and a review of births, deaths, hurricanes and wars. While browsing our office web site, the listing of the 2005 articles I have written for the Harford Business Ledger prompted me to embark upon my own year in review.

January's article discussed the booming real estate industry and the then upcoming comprehensive rezoning process. The Master Land Use Plan had been adopted and provided for very little additional growth. The article expressed concern that growth would continue to occur, but the Master Land Use Plan and the comprehensive rezoning would not incorporate planning to accommodate that growth As I stated in January: "My personal view on all of this is that demand is strong and will remain strong and therefore growth will occur. The County should plan an area for that growth to occur and provide the infrastructure for the growth in a planned fashion, with adequate open space, recreation space, utilities and road network. If the County does not plan for that growth, then if it occurs, it will occur in an unplanned fashion in the rural areas which the County has expended great sums to preserve through the Agricultural Land Preservation Program. Without that planning, facilities for recreation, open space, utilities and road networks will not be sufficient."

It is interesting to move forward from the January article to the December article where the explosive growth anticipated by the Base Realignment and Closure Commission legislation ("BRAC"). The County needs to understand that BRAC is not a market or a trend or a "maybe," but is federal legislation. The course of the currently pending comprehensive rezoning has not changed. It should. Again, as I stated in January: "To me, it's a 'no-brainer'." If growth is planned and it doesn't occur, the harm is nowhere near as devastating as if you don't plan for growth and it occurs anyway.

February's article discussed New Year's resolutions for your business. In business, the resolution most often overlooked is the corporate resolution. The law allows the creation of legal fictions known as LLC's, corporations, partnerships, limited partnerships and other entities. These entities provide many benefits, but only if corporations play by the rules. If the signature of a corporate officer is not properly indicated, that individual may be personally obligated for the undertaking he has signed rather than corporately obligated.

The other corporate sin that occurs most frequently is the failure to file corporate personal property tax returns with the State of Maryland. Failure to file that tax return results in forfeiture of the corporate charter. You would be shocked how many corporate charters are not in good standing as a result of a failure to file a personal property tax return. Make your own New Year's corporate resolution to closely monitor your corporate activities to be sure that you can derive all of the benefits conferred by corporate existence.

March's article addressed the Harford Business Ledger's special feature section on sports and the business of sports. The biggest issue facing the business of sports is liability for injuries to participants and the spectators. This issue is of interest to businesses involved in sports related fields, fitness professionals and anyone who participates in organized athletic events. The most valuable tool in the business owner's tool box in this area is the release which is signed by activity participants. All business owners should make sure that such releases are available and are properly signed before anyone is allowed to participate in an athletic activity. Contract law allows venue owners, spectators and participants to contract away certain rights and obligations. Business owners should take advantage of those opportunities in order to protect themselves.

The topic of April's article was "Get It In Writing!". Everyone in business these days is very busy. The failure to confirm understandings or agreements in writing is the easiest to overlook and causes the greatest damage. Anytime more than one person is involved in the ownership or operation of a business, the relationship should be documented. Issues such as death, disability, compensation and responsibility should be clearly understood in a written document. The whole issue comes down to risk management and, generally, the more writing, the less risk.

May's article was appropriately titled "Ready, Fire, Aim"; it was critical of crisis legislation. The legislative over reaction on the federal level in the case of Terry Schiavo occurred several times this year on the local level. The most glaring example of ill-conceived legislation which is still in effect is the ban on all gas station construction not served by public water and sewer. In response to the MTBE contamination, a moratorium was initially passed halting the construction of new facilities with a gas dispensing component. The article quoted a friend of mine who stated: "That's like passing a moratorium on the construction of banks because one was robbed!" How does preventing the construction of brand new state-of-the-art facilities -- in an industry which has experienced a technological revolution in the past decade -- solve the problem of 30-year old leaking tanks? Although the blanket moratorium was ultimately repealed, the law remains on the books prohibiting the construction of new service stations in areas not served by public water and sewer. Shouldn't we be worried about the old gas stations and not the new ones?

June's issue of the Harford Business Ledger featured the family business. My article focused on the legal challenges peculiar to family businesses. As stated in the article: "It is bad enough to have a falling out with a partner you will never see again, but when the falling out impacts the invitation list at Thanksgiving, it strikes much closer to home and heart! From a legal standpoint the goal of any family business should be to eliminate as much opportunity for dissension as possible." Get it in writing from the April article is the most important part of the operation of the family business highlighted in the June article. In addition to concerns about what happens in the event of death, disability, retirement, quitting or being fired, other complexities are presented by family businesses in which not all family members are involved. This presents a tricky situation when trying to be fair in the estate planning scenario. There are a myriad of ways to structure solutions to these problems, but it is absolutely essential that the issues be identified and resolved in writing, in advance, to avoid dispute and dissension.

The Harford Business Ledger's special edition on residential and commercial development in July of 2005 was very timely. County Executive Jim Harkins had just resigned and BRAC was beginning to look very beneficial for Harford County employment and economic development. Of course, with that benefit comes the burden of housing and providing services for those new residents. The theme of the January article repeats itself -- and it should, because growth is clearly the biggest issue facing this County. As stated in July, air is coming into the Harford County balloon whether you like it or not. We must direct the balloon to expand where we want it to, or it will simply expand on its own. The problem must be addressed, and quickly, or the balloon will expand in areas where we don't have facilities and where we have not planned properly.

The August article was quite simply a call for civility in the workplace. Voice mail, e-mail, text messages, faxes and other technological advances have certainly increased the quantity of communication, but have strained the quality of communication. Not only has grammar and syntax suffered, but, most importantly, human interaction and relationships have suffered. Old-fashioned face-to-face meetings where several minutes were spent exchanging pleasantries simply don't occur very much any more. Very few e-mails, faxes or text messages start with an exchange of pleasantries.

I think the conclusion of that article is worth repeating: "Remember -- these days, most of us spend more time with those with whom we do business than we do with our spouses and our families". When all is said and done, the greater part of our entire lives will have been spent working. It is therefore, especially important that we make the work experience as pleasant and as enjoyable as possible. Take a breath and try to do a few things each day to make your business life and your relationships with those with whom you do business more pleasant, enjoyable and fun.

The September article dealt peripherally with planning issues. My visit to a local engineer's office and review of huge aerial photograph of Harford County taken 20 years ago prompted me to think about what that aerial photograph may look like 20 years from now. The bottom line of the article -- we should imagine what that photograph will look like in 20 years and start planning now.

The October issue was a call to action for estate planning, updating your will, revising and updating your power of attorney and revisiting your medical power of attorney. The World Trade Center attacks, Terry Schiavo court fights and the hurricanes of 2005 should change the way we look at these issues. Events previously uncomprehended and incomprehensible are now occurring. The only way for you to be sure that you are not the next Terry Schiavo is to do something about it now. Make sure all of your estate planning documents are in order and up to date.

After space issues and changes at the Harford Business Ledger caused me to take a "bye," December's article (in the "January" issue) took a hard look at BRAC and the economic development opportunities that BRAC will present to Harford County. The article also spent time bestowing well deserved praise on the Office of Economic Development for its efforts, which were nothing short of heroic, to land the BRAC coup for Harford County. Little did I know when writing the article over two months in advance of its publication that my praise for Harford County Economic Development Director Tom Sadowski would appear in an issue with the front page announcing his transition to a new job as Executive Vice President of the Economic Alliance of Greater Baltimore! The good news for Harford County is that in his new role heading the Alliance's business development efforts in the information technology/defense and financial services sector, Tom will continue to be a valuable asset to Harford County's economic development and expansion.

Thanks for your support of the Harford Business Ledger and Harford County business in 2005. We are all looking to a very prosperous 2006. And, although this article will appear in the February issue, I'm writing it in late December, so: Happy New Year!

The materials and information posted on this web site are for informational purposes only, and do not constitute legal advice. If you are a current client of Brown, Brown & Young, P.A., please contact your attorney to obtain advice with respect to any particular issue or question, including any of the information provided on our website, or any other matter.

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