Business owners who go through a divorce are in a vulnerable position. They may fear being forced to shutter the doors of the businesses they co-own with their spouses during the settlement phase of the process.
Suppose that you and your spouse took a big risk and combined your savings right after college and opened your own restaurant. You kept the doors of your fledgling business open through the lean years and together grew it into a successful enterprise from which you both draw your income.
But somewhere along the way, the two of you fell off the track in your marriage. Now, one of you has filed for divorce. But what will happen to the business?
The best case scenario may be for one party to either take out a loan and buy the other party out of the business or to use their share in the business as leverage to negotiate for other marital property (e.g., their half of the family home).
In some circumstances, it could be necessary to take on another partner to provide the cash to cover the heavy debt load of buying the other spouse out of the shared business.
Perhaps the worst scenario of all is if neither spouse is willing to compromise when dividing business assets. Then, the court could rule that the business must be sold and the proceeds divided. That decision will rarely be a win for either spouse.
There is another solution, but it is not for the faint of heart: Remain in ownership of the business with your spouse. This might work better if one party remains a silent partner who is uninvolved with the day-to-day activities of the business.
Still, there are some divorced couples who manage to continue operating shared businesses as co-owners even after they legally split. This solution requires a commitment to dealing with one another with civility and respect in all interactions, as you don’t want your fights to become entertainment for your customers.
If you want to fight for your business, make sure that you share your intentions with your Atlanta family law attorney in order to make that a settlement priority.
