All about business names

Understanding Corporations

It’s A Separate Legal Entity

A corporation is a separate legal entity.  It is a virtual legal being recognized by the courts, with certain legal rights and responsibilities.  All you have to do to create this virtual being is to submit the proper information in the proper format and pay some money.

It’s A Legal Fantasy That Comes Alive

According to the dictionary, one of the definition incorporation is “to give material form to, as to embody.”  Thus, to ‘incorporate’ is to create a new legal entity in the eyes of the law.  But in order to incorporate, the state has set out certain requirements.  Once the state has the necessary information, it will declare that a new virtual baby has arrive into the legal world – your corporation!  The birth certificate of this virtual entity is the Certificate of Incorporation, which is also proof of the existence of the corporation.  The date of birth of the corporation is the date of the certificate.

This new corporation, being virtual, must be given a mind and a body. The mind is provided by the Board of Directors, who make the decisions as to what the corporation will do.  The actions required of the corporation are performed by the individual(s) whom the Directors appoint.  Thus if contracts have to be signed, the Directors might designate the President do so.  It is the virtual corporation that will be bound by the contract, not the President, provided it is signed properly.

Understanding Corporation Names

The Corporation ‘Surname’

The law requires that the ‘surname’ of this entity be a special designation, such as Inc., Incorporated, Ltd., Limited, etc. Therefore, everyone knows that if a business has this designation it is a corporation.


The law also says that the corporate name cannot be confusing with another business name, corporate or otherwise.  It is your responsibility, not the government’s, to ensure this.  The government specifically waives that responsibility.  Even if the government registers your corporate name, that does NOT mean you have the right to use the name or can’t be sued for infringement.

Therefore, you should do searches for potentially confusing business, corporate and trademark names.