Family Law – Division of property - Valuation
For significant portion of their 27-year marriage, husband and wife worked together in husband's financial consulting business. Wife initially provided clerical support, while running household and caring for parties' two children. Issue arose as to valuation of husband's business, specifically on value of his book of business. Husband's expert testified that absent evidence of special purchaser, goodwill was valueless and wife's expert considered it as most valuable asset in financial advice business. Evidence of wife's expert was accepted. Book of business clearly had value as demonstrated by current arrangement that husband had entered into where he paid 35 per cent of commissions earned on investments made for his clients to third party, who provided administrative and office support for those clients. Those clients continued to seek husband's advice and he continued to earn money from that advice due to goodwill accumulated over two decades that he had business. Book of business was product produced by business that both parties contributed to during course of marriage. While husband had de-registered as mutual fund dealer, he continued to administer and manage his clients' book of business. While parties lived together in marriage and worked together, business had built up excellent relationships with customers, employees fostered, and contacts were made that became part of book of business, which had value. Wife was entitled to share in that value. Evidence of wife's expert was based on presumption that potential purchaser would step into shoes of financial advisor and add it to existing client base, and that husband would agree to remain with business for transitional period ensuring smooth transfer of clients to purchaser and agreeing not to compete for specified time period. Presumptions were both reasonable.
Abu-Saud v. Abu-Saud (2019), 2019 CarswellOnt 21115, 2019 ONSC 6303, Thomas J. Carey J. (Ont. S.C.J.).
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