Posted by Nydia Streets of Streets Law in Florida Divorce
Divorcing spouses no longer want to be in a marriage together, and they may no longer want to be business partners in a jointly-owned corporation. Thus, Florida law favors not forcing ex-spouses to continue to jointly operate and own a marital business. Instead, the court is required to fashion a remedy that takes into account each spouse’s share of the business.
In the recent appellate case Bowen v. Bowen, 1D18-912 (Fla. 1st DCA 2019) the trial court awarded a fifty percent interest to each spouse in an ongoing marital business. An appeal was taken, and the appellate court reversed this ruling based on Florida case law which holds, “[I]t was improper for the trial court to leave the parties as joint owners of this closely held business." Other Florida case law on this issue has held that “[G]ranting a former spouse a shared interest in the stock of a closely held corporation has the effect of 'requiring the former spouses to operate as business partners. Such a financial arrangement is intolerable.’”
The trial court was instructed to award the business to one of the parties and “devise a plan of distribution which causes the least interference with the ongoing business of the corporation, yet which is practical and beneficial to both spouses." This may mean the spouse retaining the business would have to pay half of its value to the other spouse, possibly in a lump sum or installment payments.
Dividing a marital business at divorce may require an appraisal and other special assessments to determine the best way to divide it. Schedule a consultation with a Miami divorce lawyer to determine what special considerations need to be made in your case.