But my speedboat is owned by the Company!
It may have sounded like a clever tactic after a few drinks at your mate’s barbeque as you tried to solve your list of problems, but the reality is it won’t work. Trying to hide assets is not the way to go.
Likewise, you should not try to hide any business or the assets of a business. There are Court procedures in place if a spouse or life partner engages in such non-disclosure. The end result is that a party guilty of breaching an undertaking of disclosure can be found to be in Contempt of Court. A serious matter, and not a recommended path.
Separation and divorce are invariably stressful times for all concerned. The complications and stressors mount up as one adds to the list of variables: children, family home, investment property, items of value—monetary or emotional—and of course, the family business.
There are many variations on the whole family business side of things. Is it…
- Sole trader
- Partnership – either with your spouse only, with other partners, or with spouse and other partners, some of whom may be family members
- Company or family trust – which may or may not be connected with personal superannuation arrangements
The Family Court will address the issue of the appropriate division of assets. This will include those mentioned earlier, and also, any and all business assets. It is in this arena that Company Law becomes entwined with Family Law.
A valuation calibration
It will be necessary for the Courts to make a proper valuation of business assets, as will have been done with personal assets.
The method of valuation will vary with the type of business, and this raises a first and very important consideration.
I’m all caught up with my paperwork… said no one ever!
It will greatly assist if your business or company has up-to-date, accurate and well-ordered records and accounts. Small business ownership, in particular, can place huge demands on time and resources, and sometimes the paperwork can get way behind. If this is an issue, it is worth addressing early.
It may well be that your company or business is your sole income, and if your spouse is involved in the operation, flared tempers and personal stresses can put the company at risk. This can be exacerbated if the company operates from a family residence.
Either way, the effect on other staff or other partners can be crucial, potentially detrimental to the business and the livelihood of all involved.
Keep calm and …
Having your business in good working order will benefit everyone involved, especially now. Your stress can be reduced if you have clear, quality information and advice on the way forward—not just for the personal side of your divorce, but in how the courts will deal with your business interests.
Now is not the time to just wing it. It is now that you must have sound legal advice. Family Law and Company Law … let us guide you. It will be easier with sound legal advice from the experts.
Owen Hodge Lawyers. We are here to help.