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martyburbanklaw, Attorney
Category: Business Law
Satisfied Customers: 163
Experience:  Attorney with a post doctorate law degree (LLM) in tax
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Is it true in California that during a divorce when the ...

Customer Question

Is it true in California that during a divorce when the partnership is between a married couple, when one member of the partnership leaves, the business ceases to exist? And would a court order be issued instructing all business to cease until the court appointed accountant could conduct an inventory?   If so would this have had to happen and been served along with divorce papers? How quickly could one change to a sole proprietorship?
Submitted: 8 years ago.
Category: Business Law
Expert:  martyburbanklaw replied 8 years ago.

The business does not cease to exist, but the partnership does. By definition a partnership requires two or more people. You become a sole proprietorship the second you only have one proprietor. You should discuss this with your family law attorney. There are community property issues involved but the business can continue to run while an appraisal is done or if you can reach an agreement with your ex about the value of the company then you can skip that expense.

Very respectfully,

Marty Burbank, Esq., JD, LLM

California Bar

Customer: replied 8 years ago.
Reply to martyburbanklaw's Post: Does the partnership end at time divorce papers are served or when both partners agree it ends or the divorce becomes final? As far as the business continuing to run, is there ever a case when the court or the other partner, might order a halt for a temporary period of time, for example for an audit or inventory? And would a court ever allow a halt that would result in a great lose of income that might set that business back for years? I would think that would be way to unfair to all parties involved.
Customer: replied 8 years ago.
Should I continue to expect a reply to my reply to martyburbanklaw?

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