For business owners, the stress of divorce can be even more worrying, with concerns over what will happen to their business adding to the strain. Many businesses do not have a stable value and are risk laden, which brings particular challenges when it comes to agreeing a financial settlement on divorce. Sarah Atkinson, a leading divorce lawyer at Stephens Scown, discusses the issues.

The starting point for dividing assets on divorce is generally a 50/50 division between the spouses. However, the inherently risk-laden nature of some business assets can be a reason for departing from an even split, with the spouse who continues to own the business after divorce retaining more than 50% of the total pot to acknowledge the risk they take on.

Many assets have a fairly secure and stable value. These are often known as “copper bottomed” assets and could include property, ISAs and other savings. In contrast, the value of many businesses fluctuate and are risk-laden.

Case law from last year highlights the need to consider the nature of the business in assessing the extent of the risk associated with its value. Where a farm was concerned the judge made no distinction between the nature of the business and the couple’s other assets because the only difference between cash and the farm valuation was “the fall of the auctioneer’s hammer”.

However, shares in a private company are much more volatile and a recent decision shows the court must factor that in, particularly by giving the business owner time to raise funds to buy out their spouse’s share.

So whilst business valuations are helpful, they are only ever a snapshot and it is the nature of a business that will impact on the court’s approach.

This is a very complex area of law and it is important to take advice early and instruct a family lawyer with expertise in this area.

Sarah Atkinson is a partner in the family team at Stephens Scown. The team has top tier ranking in Legal 500. Sarah Atkinson is recognised as a notable practitioner by Chambers UK. To contact Sarah, please call 01872 265100 or email