Full question:
Can a sole proprietor where the business is community property give half away secretly and let the other people form a incorporation and change the name?
- Category: Corporations
- Date:
- State: California
Answer:
The husband or wife who runs a community business does not need the other spouse’s consent to make everyday decisions to run the business. However, both must agree before the business
can be sold even if only one of them operates the community owned business. A spouse who has primary management and control of a business that is community property may act alone, but must give prior written notice to the other spouse of disposition of all or substantially all of the business. If the nonmanaging spouse requests an accounting, managing spouse has duty to provide those reports and records
You can sell community property without your spouse's consent if you go to court and prove that:
■ The proposed transaction is in the best interest of both spouses, and
■ Consent has been refused without good reason, or
■ Your spouse cannot consent because of a mental or physical impairment.
This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.
