All properly run businesses require appropriate business structures, such as companies, trusts or partnerships. At the time of the establishment of businesses, owners should ensure that their ‘constitutional’ agreements are put in place and refined and updated over time: these agreements regulate the rights and obligations between the parties in the business and are usually, partnership, joint venture or shareholder agreements. Owners who do not have agreements between themselves run the risk of misunderstanding how each expects the business to operate; the flexibility that each other has to negotiate changes in their arrangements; and the value to be placed on the interest of an existing owner in the business, when he/she wants to sell it.
Owners should also develop a proper personal estate plan, which is a set of legal documents recording enduring powers of attorney covering how they want to have others make decisions for them about the business and for themselves generally if they lose capacity when they are alive; and, of course, a will setting out when they die, how they want their wealth and assets to be divided amongst their family and loved ones. The prevalence of ‘blended’ families raises unique considerations for each of the owners as to how on their death, both, as spouses and parents fairly distribute their assets amongst the children of the blended families.