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Prenups can make sense where a family business is concerned

On Behalf of | Nov 19, 2019 | Family Law |

A prenuptial agreement is a legal tool/document that is never accorded casual or indifferent treatment when raised as a family law topic. We duly noted that in a recent Berdon, Young & Margolis blog post, stating in our September 16 entry that prenups are “endorsed by some parties and flat-out slammed by others.”

Endorsement was once a firm minority view, routinely being drowned out by a vast demographic espousing a “premarital contracts kill romance and destroy marriages” position.

Much of the instinctive anti-prenup rhetoric has receded in recent years, though, with a strong dose of logic and objectivity progressively supplanting a mere emotional reaction to such contracts.

Indeed, and as we underscore in the above-cited blog post, legions of people in Connecticut and nationally now strongly embrace marital contracts as planning tools of great utility. Many of them especially note the benefits conferred by prenups “relevant to financial certainty and security.”

Those upsides are prominently underscored by two business/family law commentators in a recent Forbes article. Those writers stress that “having a prenup can be particularly valuable in the case where one or both parties own a business.”

The reasons why are many. Among other things, a prenuptial contract can provide clarity concerning the following key matters:

  • Accurately pegging the value of a business at the outset of marriage and clarifying it as one party’s separate – not marital – property
  • Determining how profits and losses will be construed following marriage
  • Specifying non-titled spouse’s role in the business, if any
  • Detailing salary/income matters

The Forbes authors stress that a timely and dispassionate prenup discussion can promote a couple’s peace of mind concerning weighty business factors. A proven legal team that focuses professionally on both commercial and family law can provide relevant information and help guide the process.