Unexpectedly, on a wet late night, you are involved in a car accident and unfortunately fall into a coma or, worse still, you pass on. A massive dispute ensues in the family as to who gains control of the business and all because you did not draft a will.
Gone for good
Statistically, the number of business owners who pass on without leaving a will is rather alarming. And it usually happens because entrepreneurs are so busy planning and doing that they procrastinate on drafting a will. Procrastination consequently results in a family feud, expensive protracted court battles, divisions within the family and all the while your former business suffers and possibly goes under.
A family business is a legal entity just as any other business with a legal framework for both the present and future. The legal set up of the future of the business mandates a will must be put in place. In the context of a business, a will is a legal document by which a person states whom he or she desires to inherit what assets, cash, ownership percentage and management control over the business.
The use of an attorney in this matter is the norm as they have the requisite know-how in drafting, storing and executing the will once you are gone. Superstitiously, one businessperson said: “Drafting a will is telling death I am ready to go.” Death is not the point of drafting a will. The moment you decide to start a business with the intention of leaving it to your spouse and children, you must draft a will.
It should be part of your business plan; how you intend to train, involve and finally decide on who will get and do what in the business once you retire or pass on.
It’s raining heirs
Over and above that, you do not want to be turning in your grave witnessing the destruction your legacy is causing in the family. Because legally an ex-wife who was there when you started and supported you; or the mother of your illegitimate child; or your son who worked for you for 20 years and you promised him he will take over the business; all can challenge in court and cause a messy situation. All this can be avoided by planning for the future that you will not be a part of, now!