If you are a follower of basic cable house “flipping” shows or of celebrity gossip, chances are you’re familiar with the stars of HGTV’s “Flip or Flop” show. The weekly show follows a married pair of highly successful house flippers from Orange County, who appeared on screen as a happy husband and wife with two children. In late 2016, though, the couple announced that they were separated, and in early 2017, the husband filed for divorce, according to an Orange County Register report.
Before the husband filed, though, some online sources claimed that executives at HGTV were demanding that the couple go back to holding out the appearance of a happy family, at least for the remainder of their TV contract, or else face a lawsuit for breach. While your impending divorce may not lead to litigation launched by a TV network, it still may involve many complex hurdles you must address if you and your spouse share a business together.
One of the biggest business-related things that you’ll have to address in your divorce is the valuation of your business. Take, for example, this 2015 case involving a pair of extremely successful upscale grocery stores. In this couple’s case, the stores were held by an S corporation, of which the husband was president and the wife vice president. Each of the spouses retained experts who created valuations of the business.
An important part of the case and the appeal that followed related to the issue of business valuation. In this case, the husband received a more favorable result because the trial judge determined that his expert was more credible when it came to assessing the value of the grocery store business. The wife attacked this finding on appeal but was unsuccessful. The appeals court also rejected her appeal regarding the trial court’s decision on the valuation date of the business. This case illustrates how both the business value amount and the date of business valuation are both very important parts of the process.
If you (or your spouse) owned the business separately before the two of you married, that will also be an important factor in your divorce case. You will need to present evidence to the court regarding how long you owned the business prior to the marriage, how much of the business’ success occurred pre-marriage as opposed to during the marriage, and how much of the business’ increase (or decrease) in value during the marriage happened due to “community sources,” meaning the amount of time or money expended during the duration of your marriage.
In these types of cases, working with experienced California divorce counsel, who can help you and guide you through the process of locating and retaining a knowledgeable and skilled financial expert to assess the value of your business, is an essential step in seeking a favorable outcome in your business-related divorce case. The diligent San Diego property division attorneys at Doppelt & Forney have been assisting clients throughout Southern California, including in San Diego, Encinitas, La Jolla, and Chula Vista, for many years when it comes to divorce issues. For a free consultation, reach out to Doppelt & Forney through our website or call toll-free at (800) ROY IS IT (769-4748).
More blog posts:
California Court Upholds Attorney Fees Award in High Asset Divorce Case, San Diego Divorce Lawyer Blog, April 19, 2016
California Court Upholds Marital Settlement Agreement Covering LA Dodgers’-Related Assets, San Diego Divorce Lawyer Blog, March 10, 2015