A Third Party Needs to Testify the Value of the Business
Video Transcribed: My name is Jason Lile, and I am a Men’s Rights lawyer in Tulsa. We had previously spoken about dividing debts and assets in a divorce. Still, there’s one particular asset that’s very difficult to divide, and it will take an experienced attorney to help you out if that’s an issue in your divorce. And that is dividing a business.
As we’ve discussed, Oklahoma’s a joint property state frequently. That means it doesn’t matter whether you started a business or one of you started a business and ran it primarily and is on the board.
It doesn’t matter how the business is titled or who’s the owner/operator under the state of Oklahoma, and it is a joint marital asset. And if you’re going to divide that asset, it’s often an indivisible asset. It’s not like a car that you can sell easily. You can sell a business, but it needs to be dealt with in a way that best suits that asset and the situation.
One of the things that you need to do is to value the business. You need a lawyer who has experience in this matter. And by that, I mean knows who to call to do the valuation. Your lawyer should not do the valuation.
It needs to be a third party so that they can testify about the value of the business. If you want to keep the business and your spouse says it is worth a million dollars, you’re like, “No, it’s not. It’s worth $100,000.”
That’s very important that you get an accurate valuation because it could go very much against you. Because if the court believes her and says that the business is worth $800,000, to buy her out, you now have to pay $400,000 to that business.
The second thing is that business valuation is not rocket science. If you get three business evaluators to value a business frequently, they will get different numbers. There are different methodologies for evaluating a business.
So the lawyer must help you pick the right person to value the business, interpret the results, and use them properly in court to help you out because the result can vary depending on how the business is valued. And there are a lot of factors that go into valuing a business that will make it lower or higher, and the lawyers should be able to help you ably present those to the court so that the court can decide the best value and divide that asset.