Establishing the Valuation of a Business in a Carlsbad Divorce

Pierre Domercq Professional Practice & Business Ownership

What is the process to establish the valuation of a business in a Carlsbad or North County divorce? How will the business ownership be handled in the divorce? These questions are actually quite legally complex and this is why it is important to be represented by North County divorce attorneys with decades of experience in cases which involve a professional practice or closely-held business.
Generally speaking this is an issue of community property division. The primary questions are centered on the valuation of the spouse’s interest in the company or practice, and the nature of the property in the divorce – community, separate or a blend of the two.
When did the spouse obtain the interest in the business or professional practice? Was it prior to the marriage, or during the course of the union? In most cases businesses obtained during the course of the marriage are community property and the value of the community’s interest in the business should be divided as part of the community property division. If the business or practice was formed prior to the marriage, it is entirely possible the business interest would be separate property in this case.
There will be questions of how much (if any) marital money or community assets were used to support the business. If any marital assets were invested into the business a complex calculation of the community’s interest in the business must be performed.
The valuation of the business interest itself is a separate issue. This is usually accomplished by an external expert witness with extensive experience in the valuation of like businesses or professional practices. These cases can become quite contentious as the two sides go back and forth regarding the actual value of the business interest and the resulting community property interest therein.
If you are involved in a Carlsbad or North County divorce case and one or both of the spouses have an interest in business ownership or a professional practice you will need the experienced and seasoned attorneys at Burke & Domercq to protect your interests and advocate on your behalf.
We invite you to review the comments and recommendations of our clients, and contact us or call 760-712-3741 to schedule an appointment with one of our lawyers.