Divorce and claims against an old business
Discussion
Il try and keep it simple,
I’m going through divorce and previously had a small business that was loss making. My ex knows there were a few assets left over from that business that I sold (I used these to pay off business debts though which she may not know that)
They are claiming that they were involved in the business but in all honesty she did very little and dined out on saying she did.
What I’m wondering though is if they are so keen to claim they were involved in the business and contributed to it and thus claiming they deserve a share of the money (there is none) then can I also claim that if they want a share if it’s profitable can I counter claim that they can be responsible for the same share of the debts?
I’m going through divorce and previously had a small business that was loss making. My ex knows there were a few assets left over from that business that I sold (I used these to pay off business debts though which she may not know that)
They are claiming that they were involved in the business but in all honesty she did very little and dined out on saying she did.
What I’m wondering though is if they are so keen to claim they were involved in the business and contributed to it and thus claiming they deserve a share of the money (there is none) then can I also claim that if they want a share if it’s profitable can I counter claim that they can be responsible for the same share of the debts?
Perfect that’s what I was thinking. The money put into the business was from the sale of assets I had before the marriage, she didn’t put in a penny into the business and has no chance of proving she actually did anything to help the business not that she did.
As soon as I saw the claim I thought she’s assuming there’s money to be had so if those rules were applied in law then debt would be shared too. Thanks very much.
Am I also right in assuming that they can’t force me to sell my current business either? I’m a sole trader, company is in debt, the only asset it has is the building I work from which is mortgaged and clients which I can’t sell. If it was to be sold and all creditors paid off I’d still be owed about £10k by the business which I’d need to pay off the personal debts I have.
As soon as I saw the claim I thought she’s assuming there’s money to be had so if those rules were applied in law then debt would be shared too. Thanks very much.
Am I also right in assuming that they can’t force me to sell my current business either? I’m a sole trader, company is in debt, the only asset it has is the building I work from which is mortgaged and clients which I can’t sell. If it was to be sold and all creditors paid off I’d still be owed about £10k by the business which I’d need to pay off the personal debts I have.
Try to look at it as the shares in the business being the joint marital asset, not the business itself. The shareholder's liability is limited, so she can't be held liable for any of the company's debts (unless there are any shareholder guarantees still in existence). The worst that can happen is that you are forced to provide an independent valuation of the shares, carried out by an accountant.
hutchst said:
Try to look at it as the shares in the business being the joint marital asset, not the business itself. The shareholder's liability is limited, so she can't be held liable for any of the company's debts (unless there are any shareholder guarantees still in existence). The worst that can happen is that you are forced to provide an independent valuation of the shares, carried out by an accountant.
You are over complicating it.There are no shareholder funds.
The business has no assets, only debts, and apparently no longer trades. It is worthless.
My Ltd co has been disregarded in my ancillary relief proceedings - it’s just a vehicle for my contracting with no substantial assets. They were initially jumping all over it trying to force disclosure of business bank statements accusing me of using it like a hidden personal account, but the judge threw that out.
hutchst said:
Try to look at it as the shares in the business being the joint marital asset, not the business itself. The shareholder's liability is limited, so she can't be held liable for any of the company's debts (unless there are any shareholder guarantees still in existence). The worst that can happen is that you are forced to provide an independent valuation of the shares, carried out by an accountant.
The now closed business was purely owned and funded by me there was no financial input whatsoever from my partner. The only way they could say they contributed really is that we had free accommodation through her employer and for a time the business functioned out of these premises but only really for me doing company paperwork. The business I run now as a sole trader is purely owned by myself, ex has never put any money into it, it is client based and they are technically my only other asset outside of the property which is mortgages. I can’t sell clients and being forced to sell the property I’m thinking that all of the business debts would have to be serviced before what’s left can be divided as a marital asset? (Not even considering she has had nothing to do with this current business whatsoever)
NuckyThompson said:
The business I run now as a sole trader is purely owned by myself, ex has never put any money into it, it is client based and they are technically my only other asset outside of the property which is mortgages. I can’t sell clients and being forced to sell the property I’m thinking that all of the business debts would have to be serviced before what’s left can be divided as a marital asset? (Not even considering she has had nothing to do with this current business whatsoever)
I've no idea how it's handled in a divorce but operating as a ST means everything belongs to you personally, not to another entity such as is the case with a limited company so I can see how it would all be up for assessment in a divorce. You need a good divorce solicitor.NuckyThompson said:
Married 10 years, no children. I have a child from a new relationship though. Both me and the ex on similar minimum wage incomes. She probably earns a bit more than me on paper and perhaps a slightly bigger pension.
My experience (divorce concluded a year ago) is that it the 'whys and wherefores' and 'fairness' won't come into it at all.The split or division of assets liquidated or not will simply be based on an assessment of what you each need to establish a reasonable life post divorce.
If you can both realise that and get honest advice and reach a negotiated settlement you will save a bundle on lawyers fee's.
Good luck with the divorce.
psychoR1 said:
My experience (divorce concluded a year ago) is that it the 'whys and wherefores' and 'fairness' won't come into it at all.
The split or division of assets liquidated or not will simply be based on an assessment of what you each need to establish a reasonable life post divorce.
If you can both realise that and get honest advice and reach a negotiated settlement you will save a bundle on lawyers fee's.
Good luck with the divorce.
Couldn’t have put it better myself.The split or division of assets liquidated or not will simply be based on an assessment of what you each need to establish a reasonable life post divorce.
If you can both realise that and get honest advice and reach a negotiated settlement you will save a bundle on lawyers fee's.
Good luck with the divorce.
The OP and his ex risk spending thousands arguing over something worth nothing. There’s no point whatsoever.
theboss said:
psychoR1 said:
My experience (divorce concluded a year ago) is that it the 'whys and wherefores' and 'fairness' won't come into it at all.
The split or division of assets liquidated or not will simply be based on an assessment of what you each need to establish a reasonable life post divorce.
If you can both realise that and get honest advice and reach a negotiated settlement you will save a bundle on lawyers fee's.
Good luck with the divorce.
Couldn’t have put it better myself.The split or division of assets liquidated or not will simply be based on an assessment of what you each need to establish a reasonable life post divorce.
If you can both realise that and get honest advice and reach a negotiated settlement you will save a bundle on lawyers fee's.
Good luck with the divorce.
The OP and his ex risk spending thousands arguing over something worth nothing. There’s no point whatsoever.
ked up, then changed their mind when it’s too late, and are then filled with spite.theboss said:
Couldn’t have put it better myself.
The OP and his ex risk spending thousands arguing over something worth nothing. There’s no point whatsoever.
Basically this at present, I’ve been very open with all info requested of me. Company accounts basically show no money and levels of debt. I have personal debt. Ex still has the employer provided home and an income. I think she’s thinking that because my family have money that either I’m hiding something or that they’ll pay her off to save funding a solicitor. The OP and his ex risk spending thousands arguing over something worth nothing. There’s no point whatsoever.
It’s a bit risky though as she can’t afford to pay those bills as the info of bank accounts etc shows this.
NuckyThompson said:
theboss said:
Couldn’t have put it better myself.
The OP and his ex risk spending thousands arguing over something worth nothing. There’s no point whatsoever.
Basically this at present, I’ve been very open with all info requested of me. Company accounts basically show no money and levels of debt. I have personal debt. Ex still has the employer provided home and an income. I think she’s thinking that because my family have money that either I’m hiding something or that they’ll pay her off to save funding a solicitor. The OP and his ex risk spending thousands arguing over something worth nothing. There’s no point whatsoever.
It’s a bit risky though as she can’t afford to pay those bills as the info of bank accounts etc shows this.
There are no real assets to speak of, only debts (which I've offered to take ownership of) and some modest pension accumulations (which I've offered to transfer to her).
However there is the prospect of a damages settlement to me, for medical negligence, in a likely 2-5 year timeframe, which is driving her greed and insistence that there is something to gain.
Current legal burn is about £15k to me and about £10k to her. This is just for financials - we have burned money on other matters relating to the kids. We are at FDR stage so this could continue rising if we don't reach an agreement. My costs are funded from earned income (my only means, being completely drained) and hers by her parents.
It's absolutely futile and a waste of money which could further the prospects of our children.
I've also re-married which means I've renounced any future claim on her. She could win the lottery or inherit her parents estate tomorrow and I'd have no grounds to claim, which I'm perfectly happy about. There seems to be two types of people - like me, and like her.
Edited by theboss on Saturday 15th June 17:51
NuckyThompson said:
It’s a bit risky though as she can’t afford to pay those bills as the info of bank accounts etc shows this.
I would be concerned that the FDR can equally decide that her risk or rather the cost is also yours. In my experience they won't realistically look at how her debt has been accrued and will simply look to zero the clocks and then make a demands based assessment of what is left and distribute accordingly.My ex accumulated significant debt over a strung out divorce and that's how it ended up being dealt with.
I guess the reality of divorce a fair settlement is probably one where neither party are happy. Key is to get to a position as fair as you can and then settle before court and move on. Anything else just lines the pockets of your lawyers.
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