One of the most valuable assets of a decedent may be the decedent’s business. Dealing with the task of managing and/or winding down a decedent’s business can be difficult depending upon whether the decedent had business partners or whether the decedent was the sole owner of the business.
If There are Business Partners Involved…
If the decedent had business partners, there may be a buyout agreement in place. A buyout agreement means that the decedent’s partners must buy out the decedent’s heirs under the provisions of the agreement. However, it may not always be that simple because either the business may not have enough liquid assets, or there may not be a buyout agreement, and the partners may not be willing to give the decedent’s share to the decedent’s heirs.
An inventory of the business assets would need to be prepared by the executor of the Florida estate and an appraisal obtained in order to determine the value of the business. The heirs would then have to negotiate with the partners. Sometimes this can turn into litigation if the parties cannot agree as to the fair market value of the decedent’s share of the business. Therefore, the services of a skilled and experienced Florida estate attorney are typically required to help with resolving the matter. Normally, both sides will hire their own attorneys to represent them in the negotiations and/or in a litigation proceeding.
If Decedent is the Sole Owner of the Business…
If the decedent was the sole owner of the business, then there are a couple options. The heirs may decide that they want to sell the assets and liquidate the business or run the business themselves. The executor may need to get approval from the probate court in order to continue managing the business or to sell assets.
Once the estate has been wound up, either the proceeds from the sale of the business would be distributed to the heirs or ownership of the business would be transferred to them if they decide to keep the business. It is not uncommon for family businesses to be handed down to the surviving spouse and/or the adult children to run or the adult children if the spouse is unable to do so.
I have been involved in many cases involving the management or sale of an active business which is part of an estate. If you are thinking of hiring a Florida probate and estate attorney to assist you with the matter, give me a call and I will be happy to speak with you.