Q:
What kinds of divorce issues impact Family Businesses that many people overlook?
A:
Well, there are several really. First is c
haracterization of Property, which involves
determining what is separate, what is community, and what will be co-mingled. Other issues include
Family Gifting,
Succession Planning,
Spousal Consent for business contracts and transactions,
Premarital
and
Postmarital Agreements, and
Estate Planning
that is consistent with characterization.
Determining I
ncome Available for Support
purposes is also important, as are the
Buy-Sell/Shareholder or Partnership Agreements
as they relate to keeping business interests in the family. In addition to Discovery of business documents and information, another key issue is
Joinder
of third parties in divorce actions.
Q:
You talked about Spousal Consent, what type of documents and processes will lead to valid consent?
A:
The first step is getting an
education and explanation
about characterization of property and transmutation. You should also inquire about
Recognition of
Fiduciary Obligations, get
Legitimate independent
Attorney review and advice, and consider w
ell drafted and thorough
Consent Agreements
that address the following Characterization, Transmutation, Transfer, Rights and Obligations pursuant to the Family Code, Fiduciary Obligation.
Q:
What can you do to avoid becoming a party in a Family Law action?
A:
Seeking the advice of a skilled Family Law Attorney
and having that person always available for questions is essential. Additionally, you should c
ooperate with the discovery process, h
ave a good Stipulated Protected Order, have
Premarital
and Postmarital Agreements and a
void Co-Mingling
Q:
What Shareholder Agreements and Restrictions on Stock Transfers are enforceable in Family Court?
A:
In court, any agreements that is well written and thorough may be enforceable. Such agreements should be
reviewed
by a skilled Family Attorney before finalizing,
not made in the process (or in contemplation) of a divorce, h
ave been
historically followed,
are not obviously biased against “The Out Spouse”
and are accompanied by a valid Spousal Consent.
Q:
Who should consider a Premarital or Postmarital Agreement and how can such agreement help avoid expensive tracing and apportionment?
A:
Every business owner and their children
should consider a Premarital Agreement. For those who are already married, the
second best alternative is a Postmarital Agreement
.
Thank you so much to Mary for her excellent presentation and information. We are grateful to have such a knowledgeable resource in our FBC Family!
We hope you can join us at our next T3Me when we discuss Corporate Culture with Ken Pense with LeadershipOne on May 2nd.
