Separate Issues Regarding Corporate Rights of the Spouses

Abstract

Even though theoretical and practical problems that arise due to acquiring corporate rights by one of the spouses have been widely investigated in the scientific literature, certain aspects regarding corporate rights of the spouses remain relevant and require more in-depth research. It is due to the fact that quite often the spouses invest their marital property in the authorized capital of a corporate entity (for example, a Limited Liability Company (LLC) or a Private Company). For one of the spouses who is a company shareholder, the right to property, which is being contributed to the authorized share capital of the corporation, becomes corporate right. For the other spouse, the mentioned above rights become claim rights, which enable them to later obtain certain sums of money, including compensation for marital property objects invested in the authorized capital of a corporate entity. In this article the author analyzes the judicial practice that regards awarding compensation to one of the spouses in case marital property was invested in the authorized capital of a corporate entity. It has been concluded that judges employ several approaches in the course of setting up the compensation to one of the spouses. Namely, that of the spouses who is not a member of a corporate entity has the right to claim the following: 1) to be compensated for the share of marital property that was invested in the authorized capital of a corporate entity; 2) to be compensated for the share in authorized capital belonging to the spouse who is a member of a corporate entity. The spouse who is not a member of a corporate entity is entitled to compensation only in case marital property was invested in the authorized capital of the corporate entity without their consent and against the interests of the family. The aforementioned will be the key criterion while deciding whether the spouse is entitled to compensation for the marital property invested in the authorized capital of a corporate entity.