SUPERCentral legal services are provided by TOWNSENDS BUSINESS & CORPORATE LAWYERS
Business Succession Services
It is truly important to have effective arrangements in place to deal with the death of a business owner.
It may be that some members of the family are capable of continuing to operate the business while others are not. This issue must be dealt with in advance so as not to result in conflict and unhappiness if the time ever comes. It would be necessary to balance the gifts from the estate to allow the family member who can operate the business to take the interest in the business while other members take other assets.
If the family is unable to operate the business then thought must be given to the best way to deal with it. If it is to be sold should that be to its employees, competitors or on the open market?
If the deceased business owner had partners then their situation must be considered. They may have rights of veto to any transfer of part of the business or a right of first refusal. If there is a buy/sell agreement in place then the family may have no right to sell the deceased’s share at all.
There is also the issue of how the business is structured. So, for example, if the business is owned by a trust then it may be that the business is not part of the deceased’s estate and the only asset that can be gifted through their Will is their shares in the trustee company. The deceased may want to issue a Memorandum of Wishes to their executor advising how they want the trust dealt with.
Great care should also be taken when gifting shares among surviving family members because if it is done incorrectly one family member may have control of the shares to the detriment of the others.
Dealing with issues of business succession upon the death of a principal of the business needs much care and considerable thought and that’s where we can help.
For a confidential discussion about our business success services, please call Townsends Lawyers on 02 8296 6222