Category: Business Valuation

Lack of Expert and Evidence Foils Business Valuation in Divorce

Personal Goodwill versus Enterprise Goodwill

When a business is an asset in a Pennsylvania divorce, the court needs detailed information — and often a business valuation in divorce — to perform equitable distribution. The information must be presented in court in an effective way.  Not having a business valuation or detailed information can lead to unexpected results.  Recently, in Sweeney v. Sweeney, No. 2164 EDA 2015 (August 30, 2016) (non-precedential), the Superior Court confronted a divorce case in which the […]

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Corporate Successor Not Marital Property Following Post-Sep Business Failure

There is often suspicion when a business that would be marital property fails shortly after marital separation, particularly if the owner spouse subsequently starts a new business.  This is the situation that the Superior Court addressed in its recent opinion, Weisman v. Weisman, Nos. 1471 EDA 2014 (July 14, 2015), a non-precedential decision. Husband was the founder of PRN Healthcare Services, a company that provided skilled and non-skilled nursing care in Montgomery […]

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“Excess Cash” of Professional Practice is not Marital Property in Business Valuation Divorce Case

The Superior Court’s memorandum opinion in Edkin v. Edkin, No. 2017 MDA 2013 (December 23, 2013) arose from a case involving a veterinary practice in the context of divorce.  The wife in Edkin filed a divorce action in 2001. Equitable distribution hearings were held in 2002, 2003, 2004, 2007 and 2009, resulting in a master’s report issued in 2010. Exceptions were argued in 2010 and 2011, resulting in a final […]

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In-kind Distribution of Stock Disfavored by Divorce Court

A decision announced recently by the Supreme Court of Rhode Island, McCulloch v. McCulloch, 69 A.3d 810, illustrates why buyouts are generally favored over in-kind distributions of stock when dividing the value of family businesses in equitable distribution proceedings. The trial court in McCulloch, faced with uncertain valuations of the businesses from both sides and a court-appointed expert, elected to award 25% of the stock to Wife and 75% to […]

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