Use of risk management in family companies legal instruments may include the main contract; inheritance contract, renunciation of the inheritance contract, testament, property regime agreement (marital of contract).
The main contract can be described as a contract which creates the basic order of the partnership, determines its internal or external relations, regulates shareholders’ rights, authority and obligations to the partnership and each other. As it can be understood from the definition, the company’s main contract regulates many issues related to the organs of the partnership as a legal entity; its capacity limits; its capital; its shares and common stocks; its shareholders and relations with third parties; shareholders’ obligations to the partnership and eachother; and termination and liquidation of the partnership, within the framework of the provisions of the mandatory law. In the main contract, which is the official reflection of the entrepreneur and a requirement for the establishment of companies, includes such as internal and external relations of the partnership, preference shares, determination and distribution of advance of dividend, investment; usufruct bonds, jouissance shares. In addition, the main contract focus on issues such as the election of board members, decision-making, task division, representation, voting; committees (family council, etc.), wages, audit, general assembly, corporate governance principles, foundation for company personnel; contingency reserve and special contingency reserve. Furthermore, the main contract clarifies subjects such as the election of the next Chairman of the company; the sale of the company's shares to another person or family outside the family; the status of the heirs who are related to the family by marriage or blood. In line with the mentioned, it can be said that overcoming dispute and sustaining company's existence is as important as the existence of company’s main contract, in order for it to get started. Especially in times of crisis and growth, this importance increases. The Company's main contract has great importance in crisis situation such as; the death of the company's major shareholder(s), non compus mentis, irreversible coma, their inability to work, their dissapearance, their convincion as a result of an infamous crime; having an illegitimate child; getting divorced; disposal of the company's shares; having an inefficient Board. Therefore, the main contract, which explains the opinions and expectation of the founding partners, is an important tool for managing the risks that may be incurred in family compaines. For this purpose, risks should be defined according to the type and characteristics of family businesses and provisions to eliminate these risks should be added to the contract. Risks change over time. Therefore, with the changing risks, the main contract should also be changed.
The inheritance agreement can be defined as "a transaction based on death between the inheritor and the other party". In positive inheritance contract, the inheritor enters into obligation to give his or her inheritance or certain property to a contractor or to a third party.
Renunciation of the inheritance contract is the one which aims to prevent the legator’s from becoming a heir in the future. With this contract, onerous contract or gratuitous contract, probable heir gives up all or a part of the disinheritance in the future.
The testament is a ready-made document or oral statement, which is created to comply with legal requirements, and the legator's wishes and desires and the principles of sharing the inheritance of the inheritor shall be explicit. Accordingly, the testament is that it is a reflection of the will of the inheritor, and is obligation to be created in accordance with legal requirements, how the inheritance is shared or requests can be included.
Community property (Marriage agreement) is a family law contract that must be done in an official way and regulates how to manage the property of the couples who are planning to get married or are currently married in the event of divorcement or during their marriage, what their rights are and obligations of the parties regarding the goods regime; how the goods will be liquidated when marriage ends.
The validity of the mentioned contracts is extremely important. For this purpose, it must be regulated in accordance with legal provisions without any doubt.
Phd. Ebru KARPUZOĞLU