As stated by BusinessDictionary.com, a separate legal entity is a business that is given its own individual legal status. This is usually done by forming a limited liability company or a corporation so that the company's actions may be legally declared as separate from those of an individual person, the company's shareholders or another company.
One reason why businesses create separate legal entities is so that the debts of those separate entities are not shared by the shareholders. As the Houston Chronicle explains, if a separate legal entity owes money to creditors, the creditors can not take that money from the shareholders' personal wealth.
Another reason for creating a separate legal entity, according to the Houston Chronicle, is that such entities have "perpetual existence." In other words, if any person tied to the entity dies or leaves the company, the entity continues on without that person. This also allows shareholders or investors to sell their interest in the company and allow the company to continue on without them.
The history of the separate legal entity is a long one, going at least as far back as mercantile trading companies in the 1600's such as the British East India Company and the Hudson Bay Company, as explained by the University of Tennessee.Learn More
"The Legal Environment of Business" by Roger Meiners is a college textbook regarding the basics of business law for a business professional who is not a lawyer. The book is in its 12th edition, as of October 2014, and co-authors include Al H. Ringleb and Frances L. Edwards.Full Answer >
The Free Dictionary gives the legal definition of "disposed" as apportioned or distributed. US Legal further explains that dispose means to attend or settle a situation.Full Answer >
Nolo.com states that a QDRO (qualified domestic relations order) is an order involving pension or retirement benefits during a divorce. The order requires that the person responsible for a pension must give a specified amount of benefits to the nonemployee spouse once the employed spouse begins receiving benefits.Full Answer >
A legal signature is one which indicates the signer's intent to comply with the terms of a contract. This signature can be either physical or electronic; the only requirement is that the signature be both voluntary and legitimate.Full Answer >