It has been reported that Camille Donatacci the estranged wife of Frasier star Kelsey Grammer will gain at least £19 million from their split as she is a joint owner of his television company Grammnet Productions. It is understood that Ms Donatacci will therefore be entitled to receive syndication rights from episodes of the hit drama that were made while they are married.

A business may have been in a family for generations. Often when the business proprietor marries the spouse becomes an employee for practical and tax reasons. Consideration is rarely given to what the implications might be for the business if the marriage breaks down. It is therefore important, if unromantic, that the business proprietor seeks legal advice on appropriate steps that should be taken, e.g. a pre-nuptial agreement or contracts of employment, prior to marriage.

Family businesses will usually be regarded as an asset of the family that can be considered in divorce proceedings. The task of the court is to establish the value of the business and how that value should be reflected in the financial settlement. A court is unlikely however to make an order for the sale of the business as usually the business will be a source of income for the family.

The court will normally wish to consider the value of the business and whether there is scope for capital to be extracted from the business for example, by selling off part of the business or borrowing against the business. More importantly the court will wish to know what income can be derived from the business.

Business interests are often the most important asset in divorce proceedings due to the capacity of the business to produce income. When considering a business in the context of divorce proceedings it is important to firstly determine whether a valuation is actually required at all. If necessary, it is normal practice to for the parties to jointly instruct an accountant to prepare a report on the relevant issues.

Should you require any advice as to how a business or business interest can be protected or will be treated upon divorce, please do not hesitate to contact a member of our family department on 0161 926 9969.