Going through a separation or a divorce is a tough situation for both parties, regardless of how amicable it is. One of the biggest issues for family law firms like Prime Lawyers however is not so much the divorce itself, but rather the splitting up of assets following the separation. This is even more complex when a business is involved, and when there are properties that are attached to the business. Even if both parties have some level of agreement in place, there is much to discuss around the splitting up of business assets and it is a process which is far from an exact science.
There are three main options here which will be considered, in order to finalize the separation and assign the properties of the business to one or more parties.
One option which will be discussed during the separation is that one party buys out the other. This of course would be subject to them having the funds that are needed to buy that half of the property within the business, and for the other party to accept this as an option. In general, we see that the business has usually been set up by only one party in the marriage, and they are of course much more keen on keeping the assets. In such an instance it is easier for a buyout. If however the business was set up by both parties in the marriage, this is a less likely option.
Selling The Business
Another option that ensures a clean break following the separation is to sell the business in its entirety, with all assets included. This is usually not something that either spouse wishes to do yet it will often be encouraged by the legal team because of how simple it makes the entire process. All that is needed is an agreement that the business will be sold, for the separation to be legally authorized. This will happen under the proviso that there will be no reneging on the sale of the business in the future. Should either spouse change their mind, they will be back to square one regarding the property of the business.
One ambitious option here is that both ex-partners will continue to work within the business and co-own it. This of course depends heavily on the status of the relationship. If there is a fracture that is irreparable then that could seriously damage the business and it is why this is an option that is often not chosen. This can work in one sense, should either of the spouses decide that they are happy to be a silent co-owner, thus giving up any say which they have in the day-to-day dealings of the company.
As you can see, the splitting up of business assets following a divorce or separation is a tricky situation for all involved, and it requires a great deal of thought and negotiation from both parties.