www.vtbar.org
factors. Under the standard of fair market
value, personal goodwill is excluded because it cannot be transferred upon sale.
The existence of personal goodwill may
indicate dependence on a key person. If
your client’s company has key person issues—meaning, the business could not
sustain its current level of operations and
financial performance without the significant participation of any one particular individual, such as the owner—the value that
individual brings to the company must be
excluded from the value of the business if
that state specifies the exclusion of personal goodwill from the value of the business.
A case of particular note in Vermont is
Goodrich v. Goodrich.4 In this case, the Supreme Court does not mandate a specific methodology for determini