A June 18, 2014 Florida business lawsuit made its way to the Palm Beach Appeals Court. Anyone who is a co-owner of a Florida business, or has inherited an interest in a private business such as Florida limited liability company may want to read this opinion.
Why Is This Business Litigation Case Important for Probate Beneficiaries?
- Many wealthy people use Florida limited liability companies, or corporations to hold their assets & wealth
- Many Florida business & probate lawyers suggest that if you own or operate a Florida business, that you don’t do it in your own name — create a Florida Limited Liability Company or “Florida LLC“
- Creating a business entity like a corporation or LLC can create estate tax savings and create a succession plan for your privately held business
- Many Florida estate planning attorneys create Florida family limited partnerships and LLC’s to transfer family wealth to children and Florida Family Trusts
- If you do it right, a family trust can be a partner
- Palm Beach probate lawyers and tax lawyers say that if you do it “right”, you may get huge estate tax and gift tax savings
What if You Inherit an LLC Interest ?
- When a shareholder in a corporation or a “member” in a Florida LLC dies, his or her Florida probate will have, or own, that private investment
- The estate’s personal representative then needs to marshall the shares or the member interests in the LLC and distribute them to whoever inherits— the Florida probate beneficiaries or revocable trust beneficiaries
- But watch out: the business interest may be sold, just like an estate asset, to pay Florida Probate Expenses, Costs and Probate Attorneys Fees
- Sometimes, the interest in the business is subject to a buy sell agreement which may restrict who inherits, or who can buy, the business interest upon your death
What Should You Learn If You Inherit a Florida LLC or Business?
- If you inherit a business or a business interest, like a private investment, you will want to know the value, and review the corporate books
- You will need to determine if your Palm Beach probate lawyer can help you with that, or whether you feel more comfortable with a Florida business litigator
- In this recent Palm Beach business lawsuit case, two co owners of a Florida business split up: one owned 51% and the other 49%
- The business owner with the 51% fired the other 49% owner
- Management style difference?
- One shareholder or member or “partner” sued the other: classic Florida business litigation
- Seeking an accounting, as well as injunctive relief and damages
- This case also dealt with a charging lien under Florida law which business litigants may wish to review
Here is the link if you want to read the entire 4th District Court of Appeal opinion.
The 4th DCA hears appeals for business litigation, commercial litigaiton, probate litigation, among other Florida legal matters. http://4dca.org/opinions/June%202014/06-18-14/4D13-1966.op.pdf