In recent years, it has become increasingly convenient for individuals to set up their own corporations in Indiana. The availability of form articles of incorporation on the Secretary of State’s website and the ease of online filing have encouraged many individuals to set up corporations on their own without the traditional approach of using an attorney.
However, when individuals take care of setting up their own corporation, they often will neglect to create By-Laws. By-Laws are a document adopted by the corporation that the corporation will use as a “roadmap” for how it conducts its business.
By-Laws can range from the very simple to the very complex, but usually cover such basic information as officers, when and how meetings will be held, voting rights, and similar items. Because By-Laws are not filed with the Indiana Secretary of State, individuals often think they are not required. Also, form By-Laws are not available from the Indiana Secretary of State, compounding the incorrect perception that they are not needed.
However, Indiana’s business corporations law states that the incorporators or directors “shall” adopt By-Laws. Thus, under Indiana law, they are required. Further, the shareholders and directors of the corporation should want to have By-Laws in place in order to further assure their shield from personal liability and to head off any disputes that may arise regarding the governance of the corporation.
If you have a corporation that does not have By-Laws, it’s not too late. Feel free to contact one of the attorneys at Bamberger to help prepare By-Laws and take any other necessary corrective action.
Author: Laura A. Scott (bio)
Phone: 812.452.3557
email: lscott@bamberger.com
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