Doing Business With Your Spouse

Do any of these remind you of yourself?

1. You want to take your spouse into the business?
2. Or you have a business, maybe at home, and your spouse is just helping out?
3. Or are the two of you are thinking of starting a business together?

I suggest – strongly – under any of these scenarios that you get yourself to an attorney now.

Why? Take the second scenario first because it hides its problems like a snake in the grass. You may not know that the law can imply partnerships by actions as well as by a formal agreement. Two spouses start a business and even without a formal agreement, a partnership can be created by their acts. I willingly admit to an aversion against partnerships. I think most attorneys do not like them. Law school beats us over the head to avoid liability for our clients as much as possible. If anything goes wrong with a partnership, then business creditors can go after all the joint assets. Since most businesses fail, why would you not be talking to a lawyer before problems start?

The other two scenario at least get the horse before the cart. The first scenario might only require tinkering with the business format and maybe a prenuptial agreement or a post-nuptial agreement while the third does require advising on the business format (corporation, limited liability company or partnership) and a post-nuptial agreement.

Why a prenuptial/post-nuptial agreement? If the clients want to keep the business running as long as possible, they need to consider all of the problems including divorce. I think this kind of l agreement needs to be considered regardless of the business type used by the husband and wife. With a partnership and limited liability company having a written document (and a LLC requiring a written operating agreement) setting out how the business shall be run, incorporating some of the prenuptial/post-nuptial’s terms does not seem out of place. Based upon that reasoning, they need a separate prenuptial/post-nuptial agreement if the business is to be set up as a corporation.

Then they need to consider their retirement and estate planning objectives. If the business entity is a partnership or a limited liability company, these objectives need expression in the partnership agreement or the LLC operating agreement and for corporations in a separate document.

Source: Sam Hasler’s Indiana Divorce & Family Law Blog

Top Divorce Lawyers Say Postnuptial Agreements On the Rise

 

Agreements Most Often Requested by Both Parties

In a recent poll of American Academy of Matrimonial Lawyer (AAML) members, 49% of the divorce attorneys cited an increase in postnuptial agreements during the past five years. Interestingly enough, 58% of the respondents most frequently draw up the agreements as a result of a request made by both parties, rather than it coming from either a husband or wife individually.

Rising in popularity throughout recent years, postnuptial agreements are voluntary marriage contracts between couples who are already married. The terms of postnuptial agreements can cover a wide variety of issues within a marriage, including disputes over potential finances, assets, children, and household chores. Couples can also seek a postnuptial agreement if the financial status of one or both partners changes dramatically after the marriage. The overall goal of the agreements is to help stop any potential conflicts and promote a stronger relationship.

“Postnuptial agreements, where valid, can be a good tool for addressing and solving problems spouses might be experiencing in their marriage,” said Gaetano “Guy” Ferro, president of the AAML. “Having a written document with expectations and obligations clearly set forth reduces the areas of disagreement for spouses and can remove a good amount of stress from everyday married life.”

Among the strangest items included in some postnuptial agreements, AAML members have noted: limits of the future number of children, provisions for pet visitation and care, and the dividing up of cemetery plots in the event of divorce.

From Yahoo Finance.

Source: California Divorce and Family Law