Lauren Preedy – Senior Solicitor – Head of Divorce Team
Companies & Divorce
Special considerations for business assets within a divorce
Business assets, whether in the form of shares in a limited company, an interest in a partnership or LLP, or those of a sole trader, will be considered part of the relevant assets of the relationship alongside other property or investments.
Unlike land/buildings, bank accounts and investments, an interest in a business can be difficult to value and is usually, by its very nature, illiquid.
A business interest is not necessarily an asset that can simply be valued by an accountant and its value added to the balance sheet of other assets owned by the couple.
There are also cases when a business owner has been particularly successful and will want to argue that he/she has made a stellar contribution to the assets of the couple and that this stellar contribution should be reflected in a more lopsided settlement than might otherwise be the case.
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Paul Jacobs FCCA – Finance Manager – Our in house accountant
Other possible complications:
But there are also other possible complications:
if the value business is added to the matrimonial balance sheet and the settlement reflects the value of the business in the capital division – but then periodical payments are then funded by profits from the business – does this mean that the recipient is receiving a double benefit from the same asset to the detriment of the other?
To what extent was the value of the business generated before the marriage and has the growth in its value since the marriage been more passive growth? Should this mean that only some of the value of the business should be treated as a non-matrimonial asset?
Are there other shareholders/partners/investors who have an interest in the negotiation and may wish to intervene? (If the business is a limited company – then it should not be forgotten that the legal company is a legal entity in its own right).
Is there actually a market for shares in a company?
If money is raised from a company either through withdrawing money or the sale of the company or shares in the company – then what are the tax implications?
Ian Walker – Solicitor/ Mediator/ Arbitrator/ Managing Director
Running a business is inherently risky and therefore how should a business be valued and its value be compared to safer assets such as property?
Have the couple can run the business together and do they wish to continue to do so? Or are there ways in which the business can realistically be split?
No two cases are the same and therefore it is recommended that expert advice is sought at an early stage.
Mixed messages from latest Family Court statistics
The Ministry of Justice has published its latest Family Court statistics for cases dealt with by the Family Courts, for the quarter October to December 2020, and the messages sent by the statistics are somewhat mixed.
Research provides insight into child applications made by mothers and fathers
We wrote here last month about research carried out by The Nuffield Family Justice Observatory (‘NFJO’), which carries out research with the aim of improving the family justice system, into who is going to court to resolve children disputes
As everyone knows, anyone involved in court proceedings should tell the court “nothing but the truth”. This applies not just to giving oral evidence at court hearings, but to every dealing with the court
As we will see in a moment, those involved in disputes over financial arrangements on separation/divorce are constantly being implored by judges, lawyers and others to resolve the dispute by agreement. But simply reaching an agreement isn’t
Court proceedings can generate a vast quantity of documents. These include applications, statements and, most importantly, judgments and orders.
Normally of course the court, the parties and their lawyers will access court documents
Welcome to Lisa Holden and Elle West and Julia Sacco
We are delighted to welcome solicitors Lisa Holden and Julia Sacco and Elle West to our team. This takes our legal team to 16 qualified lawyers supported by 8 trainee and future trainee lawyers and means that we are comfortably amongst the
Research suggests separated parents in deprived areas more likely to use family courts
As we all know, the distribution of wealth in England is not evenly spread. Many areas of the country are poorer than others, and that certainly applies to parts of the ‘catchment area’ of Ian Walker Family Law and Mediation Solicitors.
Husband not entitled to rent from wife who occupied matrimonial home
When a couple divorce the former matrimonial home can be sold. (What happens will depend on the needs of the family). If this happens, it may take some months. Until the sale is completed just one party will normally remain in occupation.