How an ‘old’ divorce obstructed a current business transfer

Remember the legal follow-up action for settlement agreements

How an ‘old’ divorce hindered the current transfer of a business

That his divorce of 12 years ago would prove an obstacle in his upcoming business transfer was something Sander (63) never expected. Didn’t he have a divorce settlement agreement? The notary pointed out a forgotten legal action. ‘Mind the final step!’

He had his affairs in order, so this was the moment for a little more free time, Sander figured. He decided to look for a suitable buyer for his company. And he found one. It was convenient that he would stay involved in the B.V. for the first few years, because bit by bit he could transfer his shares and control. After all, saying goodbye to your ‘life’s work’ naturally takes time.

Great deal
Delighted, Sander went to the notary to hear how he could formalise this great deal. He asked for advice and an action plan for the transfer. The notary looked at the current situation with him, and at the past. And from the latter, a problem emerged.
‘I see two important things,’ said the notary. ‘First of all, you were married in community of property, and the divorce settlement states that the company was allocated to you. The second: the actual implementation is missing. In other words: at the time, no legal action was taken for that official share transfer.’

Deceased ex
Sander frowned. ‘So my shares still fall within that dissolved community of property. And if I understand correctly, my ex now has to cooperate in the business transfer? But that’s no longer necessary, because she has since passed away.’
The notary explained that in that case the heirs of the ex-spouse are now the co-shareholders. Her children, in other words, whom Sander barely knew. He looked a bit uneasy and asked: ‘My divorce didn’t go all that smoothly, and those children probably know that too. What should I do now?’
The notary replied: ‘Do talk to them, but bear in mind that they may feel blindsided by this news. In theory they might feel they should have been involved in all the decision-making. And perhaps they’ll even say that there is still something to settle with you retroactively. But we’ll prepare the conversation together, and first we’ll wait and see how they react.’

Deed of division
A month later Sander returned to the notary. He seemed relieved. ‘It was a pleasant and open conversation. The children found it surprising that I came to them with this request for their cooperation. We’re going to talk again about possible compensation for the past 12 years, but broadly speaking they agreed to the transfer and to a successor for my company. So I’m happy.’
The notary was pleased too. He once again stressed the importance of the ‘deed of division’ when allocating property. ‘Whether it concerns the division of shares or the allocation of a house, a divorce settlement agreement alone is not sufficient. A transfer must always take place. Only then is it legally valid.’