How can spouses divide a business during a divorce?

When divorcing a marriage, spouses are faced not only with the question of who the children will stay with or how to divide the property, but also who will continue to run their joint business. In the process of dividing firms and enterprises during a divorce, one has to rely not only on the Family, Civil and Civil Procedure Codes, but also on federal laws (for example, on the laws “On Limited Liability Companies”, “On Joint Stock Companies”, “On Peasant (Farming”) ) farm"). Moreover, federal laws can play a primary role in this matter.

How to divide a business between spouses during a divorce?

The RF IC provides spouses with the right to divide property both on a contractual basis and through the court.

Contract section

If there is mutual understanding between the husband and wife on the issue of property, then the division of the common property of the spouses can be carried out using a division agreement. It is concluded both during the existence of the marriage and after the divorce. Spouses can discuss all the nuances, the main thing is that the points of the document do not contradict Russian laws.

Before the wedding or during the marriage, the husband and wife can also sign a marriage contract and establish in it any option for division in any shares. Both documents must be notarized.

Judicial division

If it was not possible to reach an agreement during the division of the business, then there is only one way out - to file a claim in court. Each spouse has the right to file a claim. Most likely, when it comes to dividing a business, the cost of the claim is estimated at more than 50 thousand rubles. Therefore, the magistrate’s court is not suitable, and the application must be filed in a court of general jurisdiction. You should choose the one that is located at the defendant’s place of residence. If this is not possible, then at the location of the enterprise that must be divided.

When making a decision, the judge will be guided by which of the spouses is actually engaged in business and what legal form the divisible enterprise has.

How LLCs and individual entrepreneurs are divided during a divorce according to the law

As we have already said, each spouse receives half of the jointly acquired property. This does not mean that you have to divide every item in half.

Ideally, spouses agree on who gets what. For example, the apartment and share remain with the wife, but the husband does not pay the mortgage. The terms are written down in the agreement and certified by a notary.

The usual story is that spouses argue, so they go to court. Then the court decides who should give what.

Most often, the business is rightly left to the spouse who was involved in it. This rule is not in the law, this is how court practice develops. But sometimes the share is divided in half. Then a new participant will appear in the business, which is not always good.

If one spouse is given a share of the LLC, the other is awarded compensation at half the cost.
In one case, the husband was awarded a nominal value of 7,000 rubles - apparently, the business was not of particular value. In another case, the wife received compensation based on the market value of the share in 4,986,000 rubles.
The same principle applies to individual entrepreneur assets.
One was given the property, the other was compensated for half. For example, a husband who was engaged in cargo transportation was left with two Kamaz trucks, a trailer and a Chevrolet Niva, and was ordered to pay his wife half of their total market value.

There are rarely situations where spouses share only a business. They usually argue about everything at once: an apartment, a car, a set of red antique chairs and a share in society. An entrepreneur can give away other property for the business, for example, a car. This is a way to save business.

Quietly transferring your business to a trusted friend is a bad idea. The LLC share is sold with the notarized consent of the spouse, which he most likely will not give. It is possible to sell IP equipment. But there will be a suspicion that the spouse has withdrawn the marital property, and the court will return everything back.

The court on division has three years from the moment when the spouses began to argue over property. This is stated in paragraph 19 of the Resolution of the Plenum of the Armed Forces of the Russian Federation No. 15 dated November 5, 1998. It is a mistake to think that three years are counted from a divorce. It may turn out that the ex-spouse will sue in five years, when the business becomes successful - and it will have to be divided. Or even after the death of an entrepreneur. It happens.

Individual entrepreneur loans will also be divided in half between spouses. However, this will happen with any borrowed money, but this is a topic for a separate article.

Options for dividing a company during divorce

It is quite difficult to predict how the business will be divided between spouses. Everything will depend on the form of ownership and the number of participants in the enterprise. If we analyze judicial practice, we can identify the main options that judges adhere to when dividing.

– Transfer of rights to the enterprise and monetary compensation

The most common method of division is this: the business becomes the property of one of the spouses, and the other is paid monetary compensation . Its size is established by the court. Typically this is half the value of the entire business. The owner becomes the one of the spouses who invested more time and money in the enterprise and manages its current affairs, and also considers it as the main source of income.

– Division of one company into several new ones

Business reorganization is more often used if both spouses are engaged in entrepreneurial activities. Otherwise, the idea may turn into the downfall of the entire business. There are several forms of reorganization of a legal entity. If this option is used in a divorce, it is usually in the form of a division into two companies. Less often - in the form of accession or separation.

In any case, when reorganizing, it is necessary to consult a good lawyer throughout the entire process. This form of division is only possible if the entire business belongs entirely to the spouses .

– Sale of business and division of proceeds

The sale of business shares is another common form of division between spouses. And perhaps the simplest. The spouses simply sell their assets to interested parties, and divide the proceeds between them in half or in other proportions established by the court.

– Liquidation of the company

Closing a company is a long and multi-stage procedure. They resort to it as a last resort, when the spouses decide to completely withdraw from entrepreneurial activity . At least within this structure.

When deciding to take such a step, spouses need to remember that first of all they will have to liquidate all the company’s debts to creditors.

Legal support for the division of spouses’ business after divorce

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Divorce is a very troublesome matter for business owners.

Although divorce rates have decreased in some countries over the past couple of years, it is sad to say that many people still choose divorce. The end of a marriage is a problematic situation as it is, but there are some additional challenges for business owners.

Life as a business owner—especially first-time small business owners operating on a shoestring budget—can be challenging and stressful. As the leader of a company, a lot of responsibility will rest on your shoulders, and getting distracted by your personal life can be an immediate blow to your effectiveness in business.

Dividing up a business in a divorce not only causes great emotional distress, but it can also take a toll on your finances. In this post, we'll look at several reasons why business owners find divorces especially difficult. However, we will outline here what you can do to make the proceedings as minor as possible for you.

As for the legal point of view, this issue is the subject of debate and was discussed by scientific advisory councils (for example, at the Moscow Arbitration Court in 2021). At the same time, the position has been established in judicial practice that the allocation of a spouse’s share in society is possible, but for this it is necessary to take into account a number of conditions. If you are wondering what a wife or husband can claim in an LLC during a divorce, then let’s find out.

Features of business division of different organizational and legal forms

Dividing a business can be very difficult. Various organizational and legal forms of enterprises dictate their own methods of division.

Individual entrepreneur

If one of the spouses has the status of an individual entrepreneur, then the property used to conduct business activities is equal to common or personal property. This means that all objects purchased during the marriage for the purpose of running a business will be considered common . Therefore, the court will divide them into two equal parts between the spouses.

Division of shares in LLC

A limited liability company in its activities is subject to the Federal Law on LLC, as well as the Charter of the organization.

In case of divorce, only the division of shares in the authorized capital belonging to the spouses is possible. LLC property cannot be divided during a divorce .

Be sure to study the company’s statutory documents before the division. Often, in order to insure its assets, a Limited Liability Company has serious restrictions on accepting new members. This means that even if a spouse receives a share in the authorized capital, he still will not be able to enter the business as a partner . In these cases, it is more appropriate for the spouse who was not a member of the LLC to demand monetary compensation for his share, rather than the share itself.

Division of shares in the Joint Stock Company

When dividing a significant block of shares, spouses will definitely need a securities specialist . The main difficulty here is not in determining the shares, but in calculating the value of the shares: exchange, market and nominal. Again, you should study the statutory documents, because JSCs also practice imposing restrictions on the admission of new members . This means that either the shares are sold and the proceeds are divided between the spouses, or the shares go to one of them, and the second receives compensation.

Farming

The peculiarity of the division of a collective farm is that it is divided not on the basis of the RF IC, but on the basis of the law on peasant farms (provided that both spouses are its members). There are two options here:

The farm ceases operations . The land is divided between spouses based on the Land Code of the Russian Federation. Other property is divided in equal shares or sold and the funds are divided.
The farm continues to operate , but one member leaves, who receives monetary compensation.

Division of property of a legal entity in case of withdrawal from the founders of the LLC

The division of the company's property when a participant leaves the founders takes place in accordance with the charter. The distribution occurs based on the established size of shares in the capital of the enterprise of each founder.

However, the actual and nominal value of shares may differ. With the actual value of the shares, this means the proportional value of the net assets, with the nominal value - only a part of the authorized capital of the Company.

When leaving the founders, the participant has grounds to receive the actual value of the share. Then the share is issued in the form of cash. It is also possible to receive property, but only with the consent of the remaining founders. Let us note that the material assets of the company do not belong to an individual participant, they are owned by all the founders, and it does not matter whether the contribution to the capital of the Company was made in the form of property or in cash.

If a participant disagrees with the actual value of the share, he has the right to file a claim with a judicial authority.

Division of company debts during divorce

The division of debts that a company has acquired can take place in two ways:

who took out the loan will be considered responsible for the debts . It is possible provided that the spouse spent the money received on personal needs, on his own property, etc.
Debts are recognized as common , and the spouses will both bear responsibility for them in the future. This option is carried out if the funds were spent on business development or the acquisition of common property of the spouses.

Methods for dividing an existing business

The approach to dividing a business during a divorce should be strictly individual and take into account not only the monetary investments of the spouses, but also the existing assets of the company. Any business is a complex of property and property rights. Property can be real estate, equipment, intangible assets, existing inventory, and even the brand itself. The question arises: how can you divide an entire business?

All rights to the business are transferred to one spouse, and the second spouse receives financial compensation. In practice, this means buying out a share. This method is usually used when one of the spouses is very interested in business, and the second has no desire to engage in it, and only wants to receive benefits.
Reorganization, that is, an existing business is divided into several new ones. In this case, the husband and wife receive equal shares in the joint venture. The right to reorganize a business is reflected in the Federal Law “On LLC”. According to this law, there are two possible options for dividing a business:

division involves the termination of the enterprise's activities with the subsequent transfer of its rights and obligations to new enterprises;
spin-off involves the creation of a new enterprise, to which part of the rights and obligations of the reorganized enterprise is transferred, while the original enterprise does not cease to operate, but continues to function.

This method is suitable for those who participated in the business on equal terms and want to continue the development of the company. When spouses are each responsible for their own company, the financial interests of the parties are not violated. To reorganize a business, you need to go through a number of stages:

holding a meeting of the company's participants, making a decision on reorganization, the method, procedure and conditions of the reorganization;
making changes to the constituent documents, approving the separation balance sheet;
holding a meeting of participants in newly formed enterprises, approving constituent documents, electing governing bodies;
state registration, making changes to the register of tax authorities.

Sale of an existing business and division of funds equally. Most often, such a decision is made when all the joint property of the spouses is in business and it is impossible to divide it otherwise. The specifics of selling a business depend on the legal form of the operating organization. If, in addition to the spouses, there were other participants in the business, then it is necessary to remember about the pre-emptive right to buy out the share. Only if the participants refuse the offer and notarize the refusal, the business can be sold to third parties.
Liquidation of business. This method is used only if it is not possible to sell a joint business. Then the simplified bankruptcy procedure is applied. The rights of spouses to the business cease from the moment the business is liquidated. When the decision to liquidate is made, all of the company's assets must be sold at liquidation value, which is often below market value. After the sale of property, debts and loans are paid off, and only after that the remaining money is divided between the spouses.
The spouses remain co-owners of the existing business. This is the case when spouses decide not to divide the business as property. Everyone remains the owner of their share, and the business continues to function as an entire economic unit.

“Spousal share” in case of bankruptcy of individuals

1.11.19

M. Poluektov / AK Poluektova and partners

In the case of bankruptcy of individuals, it often turns out that the debtor is or was married.

In this case, many questions arise related to what property can be included in the bankruptcy estate of the debtor and sold, how the proceeds are distributed, how the common debts of the spouses are taken into account, etc.

Let's try to sort out some of these questions. For ease of understanding, we will refer to the spouse of the debtor (bankrupt) in the feminine form as “wife”.

Is the common property of the spouses, which is their common joint property, subject to inclusion in the bankruptcy estate and sale?

Yes, it is subject.

As is known, property acquired by spouses during marriage is their joint property, the shares of which are not defined.

If the debtor's spouse does not file a claim for the division of common property, then the financial manager will include this property in the debtor's bankruptcy estate and put it up for auction.

It does not matter which spouse is the owner of the common property.

The legal basis is clause 7 of Article 213.26 of the Bankruptcy Law, according to which: “The property of a citizen, owned by him by right of common ownership with his spouse (former spouse), is subject to sale in a bankruptcy case of a citizen according to the general rules provided for by this article.”

Is the common property of the spouses, which is their common shared property, subject to inclusion in the bankruptcy estate and sale?

Shared property of spouses may arise as a result of the division of common property, when a specific jointly acquired object cannot be physically divided. In this case, the court determines the shares of each spouse in the right of common ownership of the object (usually 1/2 share, but may deviate from the principle of equality of shares). The property remains common, only its type changes - from joint to shared.

Accordingly, the question arises - what to include in the bankruptcy estate and implement:

1) all property with subsequent compensation to the debtor’s wife for her share in the common property

2) only the debtor’s share in the right of common ownership of the property?

Obviously, the second option is more beneficial to the debtor’s wife and is not at all beneficial to the creditors. Will there be many people willing to buy a share in the right to the property and subsequently be one of the co-owners?

Before the introduction of the institution of bankruptcy of citizens in 2015, the law provided for the possibility of bankruptcy of individual entrepreneurs. The second approach was applied to them (clause 19 of the Resolution of the Plenum of the Supreme Arbitration Court of the Russian Federation dated June 30, 2011 N 51). Shares in the right were put up for auction. It was believed that the forced sale of the property of a spouse who is not a debtor is unacceptable.

However, then the Bankruptcy Law was supplemented with Chapter X “Bankruptcy of a citizen” together with clause 7 of Article 213.26, which contains a special rule devoted to the sale of the common property of spouses in the bankruptcy case of one of them: “Property of a citizen belonging to him by right of common ownership with a spouse (former spouse), is subject to implementation in a bankruptcy case of a citizen according to the general rules provided for by this article."

After some time, the Plenum of the Supreme Court of the Russian Federation adopted Resolution No. 48 dated December 25, 2018 “On some issues related to the peculiarities of the formation and distribution of bankruptcy estate in cases of bankruptcy of citizens” (hereinafter referred to as Resolution of the Plenum of the Supreme Court No. 48). At the same time, he canceled the above paragraph 19 of the Resolution of the Plenum of the Supreme Arbitration Court of the Russian Federation dated June 30, 2011 N 51.

Clause 7 of this Resolution of the Plenum of the Supreme Court No. 48 states: “In a bankruptcy case of a debtor citizen, as a general rule, his personal property is subject to sale, as well as property belonging to him and his spouse (former spouse) under the right of common ownership (clause 7 Article 213.26 of the Bankruptcy Law, paragraphs 1 and 2 of Article 34, Article 36 of the RF IC). At the same time, a spouse (former spouse) who believes that the sale of common property in a bankruptcy case does not take into account the legitimate interests of this spouse and (or) the interests of his dependents, including minor children, has the right to apply to the court with a demand on the division of the common property of the spouses before its sale in bankruptcy proceedings (clause 3 of Article 38 of the RF IC).”

Taking this into account, when answering the question posed, the following interpretation seems correct:

The concepts of “division of the common property of the spouses” and “determination of the shares of the spouses in the common property” are different (they are used separated by commas in paragraph 3 of Article 38 of the RF IC and Resolution of the Plenum of the Supreme Court No. 48). The first concept, unlike the second, involves the division of property in kind without maintaining the common property regime.

You should also distinguish between “what is included in the bankruptcy estate” and “what is subject to sale.”

According to clause 4 of Article 213.25 of the Bankruptcy Law, “The bankruptcy estate may include the property of a citizen, constituting his share in the common property, which may be foreclosed on in accordance with civil law and family law.”

Therefore, if the court only determined the spouses’ shares in the common property, but did not divide it in kind, then only the debtor’s share is included in the bankruptcy estate (clause 9 of the Resolution of the Plenum of the Supreme Court No. 48 talks about including all common property in the bankruptcy estate, but This statement seems not entirely correct, although it does not affect the result of further reasoning).

Issues regarding the sale of common property of spouses are regulated by another norm contained in paragraph 7 of Article 213.26 of the Bankruptcy Law (its text is given above).

This rule is special, as it regulates issues related to the sale exclusively of property that belongs to the debtor and his spouse (former spouse) under the right of common ownership. If the second participant in the common property is not a spouse, but a third party, then this rule will no longer apply.

Moreover, in the text of paragraph 7 of Article 213.26 of the Bankruptcy Law we will not find the words “joint” or “shared” ownership. The term “common property” is used there, which can be either joint or shared. Therefore, the conclusions of some courts that this clause applies only to joint property and does not apply to shared property do not correspond to the letter of the law.

This means that if the court did not divide the common property of the spouses in kind, but only determined the shares of the spouses in this property, then the entire common property of the spouses should be put up for auction, and not the debtor’s share in the right to this property. The debtor's spouse has the right to count only on part of the proceeds from the sale of common property.

Nevertheless, it should be noted that even after the publication of Resolution of the Plenum of the Supreme Court No. 48, the courts continue to resolve this issue differently. It comes to the point that judges of the same court make opposite decisions on this issue (for example, the Resolution of the Arbitration Court of the Moscow District dated 09/25/19 in case No. A41-52233/2015 and the Resolution of the Arbitration Court of the Moscow District dated 10/1/19 in case No. A40-249642 /2015).

Is it possible to divide the common property of spouses after bankruptcy proceedings have been initiated against one of them?

Yes, it's possible.

Previously, some courts of general jurisdiction refused to consider such cases, citing the same paragraph 7 of Article 213.26 of the Bankruptcy Law. We ourselves have appealed against such determinations more than once.

However, in paragraph 7 of the Resolution of the Plenum of the Supreme Court No. 48, this issue was finally resolved.

The debtor's spouse has the right to apply to a court of general jurisdiction with a demand for the division of the spouses' common property before its sale in bankruptcy proceedings. The financial manager must be involved in this case, and the debtor’s creditors also have the right to participate as third parties.

Moreover, the common property of the spouses subject to division cannot be sold within the framework of the bankruptcy procedure until the specified dispute is resolved by a court of general jurisdiction.

Taking into account the above, the spouse should strive to divide the common property in kind, and if this is not possible, then at least convince the court to deviate from the principle of equality of shares.

According to paragraph 2 of Article 39 of the RF IC, “The court has the right to deviate from the beginning of equality of shares of spouses in their common property based on the interests of minor children and (or) based on the noteworthy interest of one of the spouses, in particular, in cases where the other spouse does not received income for unjustified reasons or spent the common property of the spouses to the detriment of the interests of the family.”

Does it make sense to divide property out of court or determine the shares of spouses in common property?

Often, spouses divide the common property in such a way that the spouse, burdened with debts, has almost nothing left or his share in the common property turns out to be much less than ½. For this purpose, a marriage contract or an agreement on the division of common property is concluded. Sometimes a sham trial is held in which a settlement is reached.

As a rule, such spouses fail to achieve the desired result. Not only are such agreements quite easy to challenge within the framework of bankruptcy proceedings, but they also do not entail legal consequences for those creditors whose obligations arose before the conclusion of the corresponding agreement between the spouses.

Such “pre-existing” creditors are not legally bound by changes in the marital property regime. By virtue of clause 7 of Article 213.26 of the Bankruptcy Law, this means that both the debtor’s property and the property transferred to the spouse as a result of division are subject to sale (clause 9 of the Resolution of the Plenum of the Supreme Court No. 48).

It should be taken into account that if the agreement on the division of common property is not declared invalid, then it can be opposed to those creditors to whom obligations arose after its conclusion. The claims of such creditors will be satisfied taking into account the terms of the agreement on the division of property (determination of shares).

What rules apply to the common property of spouses encumbered with a pledge?

The same, taking into account the fact that after the sale of the common property, the debtor’s spouse does not receive compensation for her share in the common property if the proceeds are not enough to pay off the claims of the secured creditor.

Although it happened that the wife managed to withdraw her share from sale. For example, in the Resolution of the Arbitration Court of the Moscow District dated December 15, 2017 in case No. A40-197841/2015, the following conclusion was made: “the common property of the spouses, including those encumbered with a pledge, cannot be fully included in the bankruptcy estate from the moment the shares are determined in court in the right of common joint property of the spouses, and therefore the share of the debtor’s wife - G.L. Makareva. cannot be in the bankruptcy estate of S.M. Makareev.”

But what if we look at this situation from the position of the secured creditor? After all, he issued a loan to the debtor on the security of the entire object and the wife agreed to such a pledge. Why should he be deprived of the right to receive satisfaction from the sale of the entire object, which is the subject of the pledge?

After all, it is obvious that much more money can be gained from the sale of the entire property than from the separate sale of shares in the ownership of it.

Therefore, it is impossible to agree with this position of individual courts. If the common property is encumbered with a pledge, then it must be sold entirely as part of the bankruptcy case. Otherwise, the rights of the secured creditor will be violated.

And it must be said that it is precisely this approach that prevails in judicial practice (Decision of the Supreme Court of the Russian Federation dated October 31, 2017 N 309-ES17-15692).

Can creditors “reach” property if it is registered to the debtor’s spouse?

They can if the property is “acquired during the marriage,” i.e. general

Previously, in accordance with paragraph 18 of the Resolution of the Plenum of the Supreme Arbitration Court of the Russian Federation dated June 30, 2011 N 51, bankruptcy managers had to apply to a court of general jurisdiction with a demand for the division of the common property of the spouses.

By Resolution of the Plenum of the Supreme Arbitration Court No. 48, this paragraph of the Resolution of the Plenum of the Supreme Arbitration Court of the Russian Federation was canceled. Therefore, there is reason to believe that practice will change and financial managers will have no need to go to court with such claims.

It is enough for the manager to prove that the property is common (regardless of which spouse it is registered in the name of), which means, by virtue of clause 7 of Article 213.26 of the Bankruptcy Law, it can be put up for auction in a bankruptcy case.

To understand whether property is common or not, it is necessary to find out when and how it was acquired.

If a spouse has property registered that she received before marriage or even during marriage, but through inheritance, donation, or other gratuitous transaction, then such property is the personal property of the spouse (Clause 1 of Article 36 of the RF IC), and not general.

Various misconceptions may arise here.

If, for example, a spouse received a land plot for free on the basis of a resolution of the local administration, then, despite the gratuitousness, such a plot will still be common property, since the resolution is not a transaction (clause 1 of Article 36 of the RF IC deals with gratuitous transactions, and not about any gratuitous receipt of property).

Go for another example. The spouse bought non-residential premises using money donated or proceeds from the sale of personal property. In this case, the regime of common joint property of spouses will not apply to this premises, since the source of its acquisition was the personal funds of the spouse. The premises will remain with the wife.

If the premises were partially paid for from the common funds of the spouses, then it could already be recognized as the common property of the spouses. In this case, the spouses’ shares in the ownership of the premises are subject to determination in proportion to the invested funds (clause 10 of the Review of Judicial Practice of the Supreme Court of the Russian Federation No. 2 (2017)). Such premises are subject to sale as part of a bankruptcy case.

How is the money proceeds from the sale of the spouses' common property distributed?

They are distributed in proportion to the spouses' shares in the common property. If the shares in the common property have not been determined, then the financial manager must proceed from the presumption of equality of the spouses’ shares in the common property.

Taking this into account, the proceeds from the sale of common property are distributed as follows:

- part of the money attributable to the debtor is sent to his creditors;

- the other part of the money attributable to the spouse’s share is used to satisfy the claims of creditors for the common obligations of the spouses, if any (in the outstanding part);

— the remaining funds attributable to the spouse are transferred to this spouse (clause 6 of the Resolution of the Plenum of the Supreme Court No. 48).

In what cases can the bankruptcy estate cover the debts of the debtor’s spouse?

For example, the debtor's wife received a loan. As a general rule, such a debt is the personal debt of the spouse and the lender cannot be included in the register of claims of creditors of the bankrupt spouse.

However, in some cases such debt may be considered common. Thus, in paragraph 5 of the Review of Judicial Practice of the Supreme Court of the Russian Federation No. 1 (2016), the following is explained: “in order to impose on P. (in the case, this is the borrower’s spouse) a joint obligation to repay borrowed funds, the obligation must be general, that is, as follows from clause 2 of Article 45 of the RF IC, arise on the initiative of both spouses in the interests of the family, or be an obligation of one of the spouses, according to which everything received was used for the needs of the family.”

This means that in the case under consideration, the lender can be included in the register of claims of the bankrupt spouse’s creditors (and therefore will be able to receive satisfaction from his bankruptcy estate) only in one of two cases:

1) the spouses jointly decided to take out a loan in the interests of the family;

2) the entire loan amount was used for the needs of the family (even if the bankrupt spouse did not know about this loan).

The issue of recognizing an obligation as a general one is resolved by the arbitration court in a bankruptcy case at the request of the creditor.

Conclusion

The above-described approaches to resolving the issues raised, although based on the law, nevertheless open up wide opportunities for various abuses.

For example, spouses can model the situation as if the bankruptcy estate included the personal property of the spouse of the bankrupt debtor and this property should be excluded from the bankruptcy estate.

To do this, unscrupulous spouses “retroactively” draw up the corresponding receipts, contracts, agreements on the division of common property (until 12/29/15 such agreements could not be certified by a notary).

Or they can artificially increase accounts payable so that real creditors get less.

However, such abuses can be effectively combated. True, for this it is not enough to be a specialist in the field of family law.

Arbitrage practice

An analysis of judicial practice shows that small and, less often, medium-sized enterprises are usually divided through the courts in Russia.
If we are talking about the division of large corporations, then their owners try to stipulate all issues in advance in marriage contracts or resolve the issue behind closed doors with the involvement of their lawyers and without public interference. To avoid undermining trust in the company. Carrying out the division of a business during a divorce in 2021 is not an easy task. In this matter, judges have to focus on a large number of federal regulations and the organizational form of the enterprise itself.

What cannot be divided

The RF IC strictly establishes categories of property that are not recognized as jointly acquired property, which means they are not subject to division. First of all, these are objects that became the property of one of the spouses even before marriage, if during their life together no significant improvements were made using funds from the common family budget.

Is it fair to divide a business if only one of the spouses was involved in it?

Not really

Also, a business that was inherited by only one in a married couple or became property under a gift agreement will not be divided.

Also, parents do not have the right to divide parts of the business that belong to their minor children.

Marriage contract

One of the legal ways to preserve property during bankruptcy is a marriage contract. With its help, the standard regime of ownership of jointly acquired property is changed at the discretion of the parties. When resolving disputes, including during bankruptcy proceedings, the court is obliged to take these provisions into account. However, a marriage contract is not a panacea. First, creditors have the right to appeal all transactions for a period of three years before the bankruptcy is initiated. Secondly, obviously unfavorable terms of the contract for one of the spouses may cause the agreement to be declared invalid by the court. That is, concluding a marriage contract on the eve of the sale of property or immediately before the bankruptcy procedure is reckless. This step is taken in advance, including to minimize risks in the course of business activities. The advantage of a marriage contract is that for each item and property of the spouses, joint, shared or separate ownership can be established. This is additional protection against collections.

Important nuances

Before proceeding with the division of an existing business, it is necessary to determine what will happen next - liquidation, sale or reorganization. Once the goal is determined, you need to find a business valuation specialist. Depending on the tasks, he will be able to determine the market or liquidation value of the business. Business valuation results are necessary as evidence if the case comes to court.

If the value of the valued business is less than 50 thousand rubles, then the case will be considered by a magistrate; if the value is more than 50 thousand rubles, then you must go to the district court. According to Article 28 of the Civil Legal Code of the Russian Federation, a claim for division of property must be filed at the defendant’s place of residence.

Sources:

Civil Code of the Russian Federation Chapter 28. CONCLUSION OF AN AGREEMENT

Federal Law on LLC

RF IC Article 42. Contents of the marriage contract

Change of ownership regime

Jointly acquired property can be sold, donated, exchanged, including for the benefit of children or relatives. In bankruptcy cases, the interests of minor children are always taken into account. In addition, spouses can agree and use an extrajudicial division mechanism during a divorce, that is, enter into an agreement on the division of property. This way, ex-spouses are protected as much as possible from possible problems if the second of them becomes bankrupt. At the same time, creditors have the right to appeal all such actions committed in the three years preceding bankruptcy or after filing an application with the court. Consequently, changing the property regime solely for the purpose of circumventing liability and not paying debts will be ineffective. At Legal, you can get detailed advice and bankruptcy support services. We have qualified financial managers on our staff, so you don’t have to hire an outside specialist. It is important to consider that the financial manager represents the interests of both spouses, and not just the debtor.

What share can a spouse claim if the owner is the husband?

Property that is subject to division upon divorce is determined by Art. 34 RF IC. This includes all property acquired during the marriage. This does not apply only to objects donated and inherited by one of the spouses. But it refers to shares in business, capital, valuable shares.

That is, if one of the spouses or both together have an enterprise or own part of it, then during a divorce they are allowed to divide it. Moreover, it does not matter to whom this business was originally registered. It is possible that the wife had nothing to do with commerce at all, but was only involved in raising children. Russian legislation still establishes the principle of equality of shares in joint property. This means that if the owner of the enterprise is the husband, then the wife should still receive half.

However, dividing a business during a divorce in 2021 is very difficult, if only because equality of shares in this case can lead to a complete stop of the enterprise. The division procedure is even more complicated if the husband founded or acquired a business before marriage, but lived in the family for a sufficient number of years. This section will require serious calculations.