Divorce is messy enough when you are splitting up a house, a bank account, and maybe a family pet. Try dividing a business you built together over three decades. Things get complicated fast.
Most people assume that once a judge signs off on a property split, the financial chapter closes. You move on. But for Craig and Holly Ballegeer in Arkansas, a divorce decree entered back in October 2017 was only the opening bell. Their legal battle over a company named Groundskeeper dragged on through four separate appeals, testing the limits of business valuations, tax liabilities, and what happens when one spouse stays in control of a profitable asset for years while the legal fights rage on.
The Arkansas Court of Appeals finally put another nail in this endless litigation coffin with a ruling that should serve as a massive warning for anyone fighting over a family business during a split. The court rejected Craig's bid for a tax offset and firmly upheld Holly's 183,000 dollar half-share of the business, complete with interest dating all the way back to 2017.
The Trap Of Retaining Control During Prolonged Litigation
When a couple spends thirty-four years building a life and a business together, untangling those assets requires clinical precision. In the Ballegeer case, the original Crawford County divorce decree valued Holly's one-half interest in Groundskeeper at 183,000 dollars.
The court initially set up a reverse auction to figure out which spouse would actually keep the enterprise running. But disagreements over valuation, payouts, and mounting financial obligations turned the case into a procedural ping-pong match. Craig appealed previous rulings, won a reversal in 2024 that sent the case back to the circuit court, and tried to reshape the financial math in his favor.
Here is where the situation exposes a harsh reality of family law. Craig kept operating Groundskeeper. He controlled the day-to-day operations, pocketed the profits, and generated earnings that reportedly exceeded the entire initial valuation of the business during the years the litigation dragged on.
When you hold the keys to the operating company while your ex waits for their court-ordered payout, you are playing a dangerous game. The courts notice who is making money while the case stagnates.
Why The Tax Offset Argument Failed
During the reopened proceedings in late 2024, a certified public accountant named Cliff Hubbs testified that the couple faced total unpaid tax liabilities, penalties, and interest totaling 258,282 dollars. Craig stepped up and paid the entire bill out of his own pocket. Naturally, he argued that Holly owed half of that amount—roughly 129,141 dollars—and that his property settlement payout to her should be reduced accordingly.
It sounds logical on the surface. You paid joint tax debts, so your ex should reimburse their share, right?
The circuit court and the appeals court disagreed, and their reasoning is bulletproof. Holly acknowledged she hadn't paid toward those back taxes. However, the court pointed out a bigger picture. Because Craig retained total control of Groundskeeper and reaped its substantial profits for years, reducing Holly's property settlement to account for the tax payments would leave her with significantly less than half of the marital estate.
If you keep the cash cow running and milking profits while your former spouse sits locked out of the enterprise, you cannot use joint debts as a backdoor discount on their awarded share. The math has to reflect the actual economic reality of who held the assets and who enjoyed the revenue streams while the lawyers argued.
The Real Cost Of Prejudgment Interest
Craig also fought the imposition of a 3.75 percent prejudgment interest rate on Holly's 183,000 dollar share, arguing that no formal judgment existed demanding that specific payment back in 2017.
The appeals court dismantled that argument with ease. Prejudgment interest is not a penalty. It is a tool designed to make someone whole when they have been wrongfully deprived of money or property that legally belonged to them.
Because Holly's half-interest was valued at 183,000 dollars in 2017, and because Craig kept running the profitable business instead of immediately settling her out, she lost years of access to her capital. Meanwhile, Groundskeeper kept growing. The court found that the business earnings during the litigation easily outpaced the original valuation. Awarding interest from the original divorce date was the only way to balance the scales.
What Business Owners Must Learn From This Mess
If you own a business with your spouse and a divorce is on the horizon, do not assume you can drag out appeals indefinitely to wear the other person down.
First, cash flow during litigation matters immensely. If you retain control of an operating company, the courts will look closely at whether you are benefiting disproportionately while your ex waits for their court-ordered equity.
Second, debt credits are not a blank check. Paying off joint liabilities like back taxes is smart, but trying to subtract those payments from a fixed property settlement without accounting for operational control and profit distribution will backfire.
Third, litigation costs money, but time costs more. Dragging a divorce through four appeals over the same asset pool burns through emotional capital and legal fees that often dwarf the original dispute amount.
Get a clear valuation, settle the buyout terms quickly, and cut ties. Letting a business dispute fester in the court system for nearly a decade is a financial drain nobody wins.
