Legal Question in Business Law in California

With almost 100% certainty, the business was and is community property. The fictitious business name (FBN) statement filing doesn't change the ownership. However, false reporting is a misdemeanor; see Business and Professions Code section 17913(a). Note also that when a business is owned by husband and wife, either may execute the FBN statement per B&P Code section 17914(b).

Mr. Whipple is correct to identify this as a family law issue, not a business law issue, as far as ownership of the assets and income of the business, which is pretty clearly community property unless you operated it for some time before getting married, which complicates the division of assets, but doesn't much change the basic rights of co-ownership. He is also right that the DBA filing has zero to do with who legally owns the business. It is a report of who owns a business, not a determination of who owns it. Like any report, it can be right or wrong.

Control is a little bit more complicated. You don't mention the business having been incorporated or formed as an LLC, so I will assume you just ran it as a DBA. If that is not correct, then the following information will be wrong.

Co-ownership of a business, absent formal written agreements to the contrary such as a General Partnership Agreement, vests each owner with essentially full control of the business as if they were the sole owner. Since the DBA filing does nothing to change that, it seem that is the situation you are in. When all the owners are getting along and doing everything by consensus, informal majority rule, or something like that, everything goes fine. When they are not getting along and cooperating, the legal rule that each owner has full rights becomes a mess. At that point usually one or a few owners buys out the others, or the business has to be dissolved.

The business can be dissolved in an orderly fashion by consent and cooperation, or by a court proceeding for dissolution, accounting and winding up the business. If any one co-owner asks the court to wind up the business, the court essentially must do so. Often times filing a dissolution action triggers a buy out settlement fairly quickly given that the business tends to go to hell during a court fight, the court usually has to appoint a receiver to run the business, and it costs a hell of a lot more in attorneys' and receiver's fees than most businesses are worth. In your case, since it sounds like you are also going to go through a divorce, and there are no other owners, the court in the divorce case has the power to handle the dissolution and winding up, or award the business to one spouse with other assets awarded to the spouse who does not get the business to even it out (if sufficient assets exist). The problems of attorneys fees and most likely needing a receiver, however, also make cooperation and proceeding by agreement much more financially advantageous.

So the bottom line is you and your wife need to come to an agreement on who will own the business and how the other of you will be compensated for that, or you need to lawyer up and get a receiver in there to manage the business while the court sorts out which of you gets control, or if the business just needs to be sold or closed.