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Divorce on the farm

Farming businesses are often joint ventures run in partnership between spouses and/or multiple generations of a family, with shared responsibility and ownership of the business, land and assets. These complex ownership structures can pose potential risks in the event of the breakdown of a relationship or divorce. As a result, divorces that involve farms can be complicated and require additional considerations.

Here are our top tips for farmers facing a divorce.

What makes farming divorce cases complicated?

There is no particular difference in how a farm is dealt with by law in a divorce. The difficulty is that they are often a lot more complicated due to several key issues that can affect how the matrimonial assets are worked out and divided. For example:

  • Liquidity: often assets held within a farm are tied up and not easily realisable
  • Farming families can be capital-rich but income poor
  • Inherited assets or generational farms, if the farm has been handed down through the generations and is to be preserved for the next
  • Any impact upon third parties, for example, parents, sisters and brothers who may live on or be involved in the ownership or running of the farm
  • A reliance upon farm subsidies can affect the revenue of the farm
  • The existence of family farm trusts and/or complex ownership structures
  • Tax, such as capital gains tax and/or inheritance tax.

With such complicated assets and structures, it is crucial to instruct a solicitor that is experienced in dealing with farming divorces and who has a good understanding of agriculture and how farms work.

What factors are considered in the divorce?

One of the biggest considerations running through these types of cases is what the parties needs are and how can they be met?”

The starting point is to define the assets and then look at how to share those assets built up during the marriage.  The Courts ultimately have wide discretion in order to achieve a fair outcome. However, fair does not necessarily mean equal and farming cases do merit special consideration including:

  • Inherited assets are often treated differently and are not subject to the sharing principle in the same way
  • A farm owned by the wider family, with siblings and/or parents, will require careful thought as the Courts are reluctant to damage the livelihoods of other third parties
  • If there are enough liquid assets to go around, the Court can depart from equality in order to protect any inherited element.

How to protect your farm

If you are not yet married, consider a Prenuptial Agreement to evidence what is intended from a financial point of view if the subsequent marriage ends. This will save time, stress and money in the future. It is also possible to put assets in trust for future generations.

Expert in farming divorce cases

Within the Stowe team, we have a number of experts in farming divorce cases and have acted in a number of high-value cases with a successful track record for clients, both litigated and negotiated.

We understand the unique difficulties farming cases bring and work in partnership with third parties including land and agricultural valuers, and our expert in-house Forensic Accountancy team, to get the right team and strategy in place.

Get in touch

For more information about farming divorces please do get in touch with our Client Care Team using the details below or make an online enquiry

 

The blog team at Stowe is a group of writers based across our family law offices who share their advice on the wellbeing and emotional aspects of divorce or separation from personal experience. As well as pieces from our family law solicitors, guest contributors also regularly contribute to share their knowledge.

Contact us

As the UK's largest family law firm we understand that every case is personal.

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