A question that sometimes drives me hazy: am I or are the others crazy? - Albert Einstein
Business law encompasses business, consumer transactions, commerce, and the establishment and management of business entities, which includes incorporation. Important areas of business law involve sales, leasing of goods, debtor and creditor law, secured transactions, and negotiable instruments.
State law usually governs contracts for the sale, lease, and distribution of goods. This includes the rules for sales contracts and sales warranties.
A secured transaction takes place when a borrower agrees that the lender may take collateral owned by the borrower in the case of a loan default. State law also governs the law of secured transactions.
A negotiable instrument is a promissory note, bill of exchange, check, or other document that represents money. State law also mainly governs the law of negotiable instruments.
Creditors, a business owners, and borrowers need to have a basic understanding of credit law. People use credit to buy or borrow now in exchange for a promise to pay in the future. Most credit transactions take place using credit cards or loans from banks or other financial lending organizations. However, some businesses provide direct financing and credit to customers. These businesses need to comply with applicable federal and state credit and debt collection laws.
In the field of business law, significant federal debt collection and credit statutes are the Equal Credit Opportunity Act (ECOA), Truth in Lending Act (TILA), Fair Credit Billing Act, Fair Credit Reporting Act (FCRA), Fair Debt Collection Practices Act (FDCPA or FDCA).
An important aspect of business law is the forming and managing of business entities, like the sole proprietorship, general partnership, limited partnership, limited liability company (LLC), and corporation. This is critical for the business owner.