Divorce and the Entrepreneur: Part 1

more+
less-
more+
less-

Hi there,

Whenever a business owner, major shareholder and/or entrepreneur gets divorced, the annoyances, intrusions and disarray caused by the process itself spread beyond the immediate family.  The business itself, regardless of size, is in for it too.

Entrepreneurs have a high divorce rate, and it is partially because the demands of business creation can outweigh the demands of family.  Given the statistics, it is a good idea for business owners and boards to have thought through and decided how to handle the inevitable involvement the business will have in an owner’s divorce.  There are a number of ways you can try and protect your business long before divorce is on the horizon.  Entrepreneur.com has some good suggestions.

If you are the entrepreneur, expect that for a while you will no longer have the focus on the business that you used to.  Everyone — and as far as I have seen it affects everyone — has short term memory loss in some stage of the divorce.  They are distracted, unable to think clearly, and often are just plain depressed.

I always request that my clients see a counselor during the divorce process, as it makes sense to have a neutral sounding board at the least, and some therapy and/or medications at the worst.  This does not mean that most people going through a divorce are mentally ill.  It just means that it makes sense to get some professional clarity at times of huge situational stress which may affect your capacity to clearly run your business.  It is a good idea to not make major business decisions at a time when a clear focus on business may be difficult.

Depending on how the business is held and how it is structured, it is a good idea for the business to get or consult its attorneys, as there will be a need (which will be a subject of future posts) to protect the business as well.

Best,

Nancy

Topics:  Business Ownership, Divorce, Entrepreneurs

Published In: Family Law Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Burns & Levinson LLP | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »