Kline Legal Group P.L.C.

Divorce and the family business

Michigan couples who own a business together should take steps to safeguard that interest in case they get divorced. For those who are already married, there are still steps they can take to protect one of the biggest assets they may own.

For those who are not, a prenuptial agreement is a useful legal document that can stipulate what will happen to the business if the couple gets a divorce. Care must be taken when they are drafted, however, and they should be signed well in advance of the wedding date in order to preclude a subsequent challenge by one of the parties that he or she was forced to sign it under duress.

Instead of a prenuptial agreement, engaged couples can opt to use a buy-sell agreement. This is a contract between the co-owners of a business, and it specifies what should occur if one of the owners leaves the business for any reason.

A business owned by a couple can also be protected for future generations. A trust can be used as a long-term tool to ensure that the business remains in the family in case the next generation gets a divorce. The trust can be created with the provision that assets related to the business can benefit only the beneficiary, and if the beneficiary gets a divorce, his or her spouse will not have access to the assets long as the assets and any proceeds remain within the trust. Estranged couples can also opt to remain as co-owners. However, this may not be ideal for those whose divorces are particularly acrimonious.

Property division is often one of the most difficult aspects of a high-asset divorce. Couples who own a business may want to have the help of their respective attorneys when attempting to reach an accord on this issue.

No Comments

Leave a comment
Comment Information
Email Us For A Response

Contact Kline Legal Group P.L.C.

Kline Legal Group P.L.C.
483 Little Lake Drive, Suite 200
Ann Arbor, MI 48103

Phone: 734-249-6100
Fax: 734-302-7222
Map & Directions

Contact Our Office

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy