For business owners facing divorce, the prospect of having their company scrutinized in open court can be overwhelming. The business you have spent years building suddenly becomes subject to valuation, division discussions, and potentially public testimony. However, there is an alternative path that offers greater control, privacy, and flexibility: divorce mediation.
At Joseph Law Group, P.C., we understand the unique concerns that business owners bring to the divorce process. With over 100 years of combined experience serving families, our team provides the honest guidance and robust advocacy that high-net-worth individuals need during these challenging transitions.
Control Over Business Valuations
One of the most significant advantages of mediation for business owners is the control it provides over how, when, and even whether your business is valued. In traditional divorce litigation, a court may order a business valuation as a matter of course. In mediation, you and your spouse have the power to make that decision together.
Some couples choose to waive formal business valuations entirely. They may already have an understanding of what constitutes a fair resolution and prefer not to expend the resources required for a professional valuation. As long as both parties knowingly enter into such an agreement and understand their right to have the business valued, they can choose to proceed without one.
For those who do want a valuation, mediation still offers advantages. You can choose when the valuation will be conducted and have input into which professional or company performs it. This is a significant departure from litigation, where these decisions are often made by the court without your input.
Flexibility in Choosing Valuation Professionals
Mediation provides options that litigation simply cannot offer when it comes to selecting business valuation professionals. Rather than having a valuator assigned or ordered by the court, you have the opportunity to meet with different professionals, understand their methodologies, and learn about the costs and fees involved before making a commitment.
If one spouse selects a particular valuation company, the other spouse has the option to choose their own professional as well. This can be particularly valuable when both parties want independent assessments of the business. In these cases, the results can be compared, and couples often agree to take an average of the two valuations to reach a resolution that feels fair to both parties.
This flexibility allows for tailored solutions that address the specific circumstances of your situation rather than a one-size-fits-all approach imposed by the court system.
Privacy and Confidentiality
Many business owners are deeply concerned about the exposure and liability that comes with litigating a divorce in court. Taking the stand to testify about your business operations, finances, and valuations creates a public record. Competitors, employees, clients, and others may potentially access this information.
Mediation offers a private alternative. Discussions about your business take place in a confidential setting, typically in an attorney's office. You can address valuation issues, discuss the distribution of business assets, and reach agreements without the public nature of courtroom proceedings. For business owners who value discretion and want to protect their professional reputation, this privacy can be invaluable.
Scheduling Flexibility for Busy Professionals
Running a business requires your attention and presence. Urgent matters arise, deals need to close, and clients require your focus. When you are involved in divorce litigation, court appearances, depositions, and hearings are scheduled without regard to your business calendar. Missing a court-ordered appearance is not an option and can result in serious consequences.
Mediation operates differently. If something urgent comes up in your business that requires your attention, there is no harm in rescheduling a mediation session. This flexibility allows you to prioritize your business when necessary without facing penalties or complications in your divorce proceedings. You maintain control over when and how you address your divorce in a way that does not interfere with your day-to-day business operations.
Prenuptial and Postnuptial Agreements
If you have a prenuptial or postnuptial agreement in place, these documents become central to any discussion about business asset distribution. At the start of a mediation, your attorney will review these agreements carefully because they can significantly impact how business assets are treated during the divorce.
Generally, business assets acquired before the marriage are considered separate property. However, the situation can become more complex when a business started before the marriage experienced significant growth during the marriage. Conversely, if the business declined in value during the marriage, that too affects the analysis. The terms of any prenuptial or postnuptial agreement will guide how these situations are handled.
A Client-Centered Approach to Business Owner Divorces
At Joseph Law Group, P.C., we recognize that every business owner's situation is unique. Whether you own a small local business or manage a substantial enterprise, the concerns about protecting your assets during divorce are real and valid. Our team takes a client-centered approach, providing clear and ethical guidance while developing flexible and tailored solutions for your specific circumstances.
As a premier and deeply-rooted family law firm, we are committed to strength, empathy, and long-term family solutions. We understand that divorce is not just a legal process but a significant life transition that affects your family, your business, and your future. Reach out today for a consultation.
