Possible issues in a business when a business owner passes

There can be severe implications to a business when a business owner passes. After all, this can leave a business in a state of uncertainty such as who will continue the business after, and whether it should be sold. Still, there are other factors to consider such as the possibility of a business being dissolved, and whether redundancy payments are going to be met by the business. It is possible that these possible issues can emerge all at once.

However, these problems can be avoided by being resolved earlier. This can be achieved by writing a will which includes provisions in the will, such as nominating an executor to oversee business assets and operation management until the business is sold. In general, the individual is appointed would be the one the deceased trusts and hold a wealth of knowledge of the business. Still, before the nominated executor of the will can commence the distribution and dealing with the claims of the deceased’s assets, it is likely that they would have to apply for Probate. 

A legal definition of a Probate is the process of dealing with legal and financial affairs with properties and assets (money and possessions) of the deceased. This is permitted through either gaining the Letters of Administration or Grant of Probate, and the executor can start to initiate the process of obeying the deceased’s will and distribution of their assets as accordingly. However, if there is no will from the deceased business owner then it befalls on the law to decide how to distribute the deceased’s assets by following theRules of Intestacy. This means there is a chance it can be detrimental to the business. The Rules of Intestacy tends to ignore co-owners of a business as it would benefit the interest of the deceased’s married partner rather than the business itself. 

Still, alternatively, in the example of partnerships, there should be a deed in place which approaches the possibility of a partner’s passing. If there is no establishment of a deed, then there is the Partnership Act which can be followed. However, this can still cause conflict within the business since there may be matters regarding the deceased’s share in the company, and who can buy it out. Hence, this can implicate the partners and even the shareholders of the company further and disrupt the business operation.  To tackle these possible challenges in the business, it is advisable to seek competent corporate solicitors who are experienced in probates in corporate law, and disputes in a corporate setting. This way, as a partner or business owner you can have a piece of mind in knowing that the risks of business operation being disrupted are lessened.