Business Divorce

Reviewed and approved by Kathryn Wayne-Spindler

Family businesses can be both a blessing and a profitable venture. Partnerships that are created with similar values, interests, and goals are often more successful, as the partners have similar expectations and ideas. With that being said, it is not uncommon for those involved in a business partnership to also have disagreements with one another. The issue becomes when the disagreement involves a married couple which ends in a divorce. This creates an even bigger and difficult situation at hand.

For obvious reasons, divorce with a couple that has business interest will ultimately affect the businesses management and the operations of said business. This can also create a trickle-down effect which can impact other members of the family including children, siblings, and/or parents. Married business partners should prepare a documented management plan to make sure that the business will continue to run as usual in case a divorce should occur.

In a case where a couple preforms as business partners, there is always a chance that the marriage could end in divorce. This is a situation which must be considered, as it impacts the business. No one wants to plan ahead for these types as situations, but it should be something that is planned for. Couples as owners need to do what is best in order to protect themselves and the assets they have. It is important for the attorney taking on a case where the divorcing couple owns a business to inform the potential client of the worst-case scenario. Planning for these situations may be undesirable, but it is something that should be done to prepare for all possible outcomes. This in turn creates some peace of mind and guidance as to what will happen in the event that a divorce happens. Furthermore, this can allow for the business to continue to operate smoothly and continue to prosper after the divorce is concluded.

Prenuptial agreements and postnuptial agreements should be created whenever possible in these types of cases. This ensures that the married couple is making agreements and arrangements while clear headed. With that being said, it is expected that they will want what is best for the business and for one another to achieve their goals and needs.

Arrangements can help couples see what is important to the other person to help them get a better understanding of one another and their values. These agreements can always be altered if other situations arise and both parties’ consent to the alteration of the agreement.

These agreements create a predetermined property division which can be beneficial as it can help for a more peaceful separation between the parties. Therefore, the parties can avoid common issues that arise when dealing with a high net worth divorce. An attorney needs to look into every possible scenario to protect their client.

Ownership of a business can come in many forms, such as a joint ownership. A soon to be ex-spouse may have business shares as a marital asset, but are not an owner. In Michigan, there are laws that require an equitable distribution of all property. This means that property is to be divided equally between the parties based on contribution and earning ability. There is a difference between marital property and separate property. In a divorce, financial assets are normally seen as marital property, this includes debts (of course there are exceptions to this). The parties must agree on a fair division of property, or the Court will.

When you have a couple who wants to argue over every piece of property, this process can be difficult. In a situation where the division of property becomes an issue, unwanted outcomes can happen, especially when it comes to a business.

The division of a business will be determined by the business and law. A business is usually one of a couple’s biggest shared asset. With that being said, how the business is divided is important to both parties’ financial and economic stability.

A family law attorney should be prepared to draft and execute succession plan documents for a business in case a succeeding owner goes through a divorce. There should also be incorporation documents that provide ownership rights and stakeholder value that will take hold in case that the owners of the business do end up in divorce court.

In the case of a divorce, a business should stay open throughout the divorce. The attorneys and clients should find resolutions to avoid the complete closure of the business. A divorcing couple may be able to continue as co-owners even after the conclusion of the divorce. If that is not possible, the couple may choose to have one buyout the other spouse, sell the business, or divide the business if applicable.

Divorces often have complications and other issues that arise throughout the case. Attorneys working a case where a business is involved should give their clients a wide range of options with the dissolution of the marriage and business.

With the appropriate arrangements made in regard to the business, an attorney is able to help their clients by easing any concerns regarding the uncertainty of the divorce and the business that is involved.


The attorneys at Kathryn Wayne-Spindler & Associates are experienced attorneys who change with the times to meet the needs of their clients. Contact the Milford, Michigan law office of Kathryn Wayne-Spindler & Associates at 248-676-1000 for assistance. The attorneys of Kathryn Wayne-Spindler & Associates practice law throughout Southeastern Michigan including Oakland, Wayne, Washtenaw, Genesee and Livingston counties as well as four mid-Michigan counties Clare, Gladwin, Ogemaw and Roscommon. The attorneys handle cases in Milford; Highland; Hartland; White Lake; Wixom; Commerce; Walled Lake; Waterford; West Bloomfield; Linden; Fenton; Flint; Grand Blanc; Holly; South Lyon; New Hudson; Howell; Clare; Gladwin; Houghton Lake; Higgins Lake; and many more Michigan communities. And soon to be opening another office in Dadeville, Alabama.


For more information, please see article “When Family Divorce Leads to Business Divorce” by Matthew P. Barach on