So Your Spouse Is Having an Affair with His/Her Business Partner

Work-related affairs are, unfortunately, not uncommon. But when the affair partner is also a business partner, it can become financially and legally complicated for all involved. Both parties need an experienced legal team with expertise in the challenges of dividing business assets. We want to ensure you receive the fairest and most beneficial final judgment or settlement in a divorce.

Factors to consider

For the divorcing couple, several considerations may play a part in how we start discussions about the business. First, is there a prenup or postnuptial agreement that governs or discusses the business? If so, we need to see that first. While such agreements are legally powerful, a judge may decide that some considerations in your case may override some aspect of the agreement.

For instance, did you work with your spouse to build the business? Did you provide support for your spouse in order for him or her to focus on building the business? Did you help pay for any training or education necessary to start the business or keep it going? Any financial or material support that you offered to the business may weigh against the prenup, or may at least weigh in favor of more compensation for you in other areas of the court judgment.

Of course, if you have no prenup, the business would likely be considered a marital asset, and you are entitled to a portion of the business’s value. If this is the case, you likely have several options, which we can discuss.

We also need to discuss the business partner; after all, there may be serious conflicts of interest, loss of objectivity, and power imbalances (just to name a few issues!) The affair could also impact the morale of employees, operating agreements, company reputation, and brand risk with news of the affair.  

The most concerning issue is valuation, which also plays a part in operating agreements. Your spouse could claim a lack of income (which is hiding in a deferred payment), inflate expenses, or redirect revenue and even hold contracts just to pay you less money. And, if the business partners are also romantically involved, it might be easy to doctor the books and agreements in the short term.  

We have experience and know exactly how to guide these discussions to ensure you are appropriately compensated.

Collecting your share of the business value

You may demand a payout of half of the value of the business. However, could this bankrupt the business? Would this be in your best interest and the best interests of your children? If your spouse’s business fails, will child and spousal support still be forthcoming?

You may negotiate for a stake in the business as a long-term source of regular income. Or you could schedule the payout of the business value that you are owed over the course of several years.

You could trade your equity in the business for other valuable considerations, both tangible and intangible. A business can be a very powerful leverage tool for getting other considerations that are more important to you.

Getting help to navigate a divorce

When negotiating or litigating the division of property that includes a business asset, you want an expert examining the books so you fully understand the value. You also want someone who has the expertise to weigh the business’s present and future worth in order to recommend the best strategy in your situation.

Discovering that your spouse is having an affair can be emotionally devastating. With the right legal team, it doesn’t have to be financially devastating. The legal team at Karen Ann Ulmer, P.C. has the expertise to advocate for clients in high-net-worth divorces, including those that involve business assets. If you are seeking a PA or NJ divorce, request a confidential consultation today by calling (866) 349-4721 so we can evaluate how best to lead you to a successful settlement or court judgment.