Family Law for Business Owners
Planning Opportunities
Many owners of closely held businesses exercise a high degree of enterprise control. An equitable distribution claim can substantially interfere with that control. The court is authorized to enter orders governing the financial control of a business that is marital property. In extreme cases a court can even appoint a receiver to take control of a business. At the very least, substantial effort is involved in producing documents for the purpose of classification and valuation of business assets. The existence of an equitable distribution claim can paralyze decision-making. When a marriage dissolves and a spouse becomes adversarial, sources of capital such as borrowing from third party lenders, related entities or retirement plans may become unavailable or too costly to use. After separation it is usually too late to strike a favorable agreement quickly. Just as you plan for property and casualty risks, the loss of key employees or errors and omissions, it is prudent to plan for the possibility of an equitable distribution claim arising out of the dissolution of marriage. After all, the statistics indicate that more than one of two marriages ends in divorce.
|
