Property acquired during marriage is often more complex than it may initially seem, and business shares in a limited liability company (LLC) are among the most common sources of legal uncertainty between spouses. Can a business share be considered marital property? Does a spouse have the right to half of the share even if they are not registered as a member of the company? Who decides when a dispute arises?
These questions become crucial particularly in situations of separation, divorce, or division of property, and the answers require a thorough understanding of both the Family Act and the Companies Act. For that reason, below is an overview of the key rules as well as the steps that need to be taken when a business share is subject to marital property.
The rights of spouses to marital property are regulated by the Family Act, which prescribes that marital property consists of assets acquired by the spouses through work or derived from assets acquired through work, provided that they were acquired during the duration of the marital union. When determining ownership rights over marital property, the applicable regulations are those that were in force at the time the property was acquired.
According to the Family Act, each spouse owns one half of the marital property, whose key characteristics are: work, duration of the marital union, and the object of marital property. A business share may also fall within marital property, even though this is not explicitly stated in the Family Act, if the statutory requirements are fulfilled — namely, that the business share was acquired during the marital union and through work. Property brought into the marriage, or acquired during the marriage on a legal basis other than work (e.g., through gifts or inheritance), is considered separate property and does not form part of the marital property.
A business share, including the rights arising from it, may therefore constitute marital property under the same conditions applicable to other property acquired by spouses during the marriage.
The legal presumption that spouses own equal parts of marital property (unless otherwise agreed) refers only to their share in the acquisition of marital property. Therefore, the fact that a certain item (including a business share) represents joint property or marital property must be proven by the person asserting it — typically, the plaintiff.
Given that a business share is a specific type of property regulated by the Companies Act, understanding whether it constitutes marital property requires applying the provisions of that Act as the relevant law.
The division of marital property does not necessarily require litigation if the spouses can reach an agreement on dividing the assets considered marital property, including business shares. However, when no agreement is reached, the spouse who is not registered as a member of the company must file a claim before the competent court to exercise their rights. When doing so, it is important to determine which court has jurisdiction, what type of claim should be filed, and which additional legal remedies are available under the Family Act.
The Supreme Court has held that in disputes concerning the determination that a business share in a company constitutes marital property, and that the plaintiff is entitled to an equal share, jurisdiction lies with the commercial court, since business shares encompass the totality of membership rights and obligations.
Therefore, although municipal courts have exclusive jurisdiction in disputes concerning the existence or non-existence of marriage, annulment, or divorce, in cases where a business share forms part of the marital property, the general rule applies: jurisdiction lies with the commercial court. This is because commercial courts adjudicate disputes between company members, and between members and the company, relating to membership rights, company management, and the performance of company affairs.
The competent court is the commercial court in the jurisdiction where the company’s registered seat is entered in the court register.
Claims regarding the determination and division of business shares are heard in civil litigation before the competent commercial court. The plaintiff (the actively legitimized party) is the spouse who claims that the business share constitutes marital property, and the defendant (the passively legitimized party) is the other spouse who is the registered holder of the business share.
The company whose shares are in dispute cannot be a party to the proceedings, neither as plaintiff nor as defendant.
Legal protection can be granted only if a properly formulated claim is filed. The court decides within the boundaries of the claim, meaning that an incorrectly formulated claim may result in its dismissal.
In addition to correctly identifying the parties, the claim must accurately specify the business share in question and the right the plaintiff seeks to establish in relation to that share.
For the purpose of protecting their rights, the plaintiff may request, along with the claim, the registration of the dispute in the court register. The court hearing the case will allow such registration once the applicant advances the publication costs.
The registration of a dispute is an entry in the court register — a public record — indicating that legal proceedings are being conducted which may affect a particular entry in the register. Its purpose is to ensure that no one can later claim that they were unaware of the ongoing proceedings relating to a particular legal matter.
The High Commercial Court has held that registration of a dispute is permitted when the subject of the claim is the determination that business shares constitute marital property and that the plaintiff is entitled to those shares.
A business share as marital property is both a legal and practical issue. It goes beyond the scope of ordinary property, as it carries rights, obligations, and influence over the company’s operations — making any dispute concerning such shares a matter requiring combined knowledge of family and commercial law.
For this reason, timely action is essential: properly determining the origin of the property, formulating the correct claim, selecting the competent court, and securing protection through dispute registration. Understanding judicial practice is equally important, as it often plays a decisive role in such cases.
If you are involved in proceedings concerning the determination or division of marital property that includes a business share — whether as a plaintiff or as the registered member — we strongly recommend that you contact an attorney as soon as possible for expert legal advice and protection.
