Can the family farm survive divorce?

Family farming cases however have always been approached in a very different way, because very often the farm has been passed down from previous generations.
Family farming cases however have always been approached in a very different way, because very often the farm has been passed down from previous generations.

Divorce need not sound the death-knell of the family farm, but farming families need to think about their divorce settlement in a very different way when it is the farm that is at stake rather than simply the family home, says Jonathan Brew, senior partner at Harrison Clark Rickerbys.

Brew said: “Courts will usually deal with a couple’s assets based on a yardstick of equality, taking into account some set criteria, such as the couple’s ages, how long they have been married, what their financial resources are, how many, if any, children they have and who they will live with.

“Family farming cases however have always been approached in a very different way, because very often the farm has been passed down from previous generations and so is not an asset that has been acquired by the couple through their joint endeavours over the length of the marriage.

“The court’s approach, especially where there are children, is to ensure that the housing and financial needs, both of the partner who is leaving and the children, are met, rather than seeking to resolve matters by simply providing a percentage share of the capital.

“So, in the case of a family farm, the court needs to consider the issue of liquidity and how capital could be taken out to create a fair settlement without destroying the farm.

“Raising capital from the farm to fund a divorce settlement needs to be carefully handled, taking into account any potential for development, tax issues and the viability of the farm post-settlement. This might mean having to negotiate extended borrowings, with a structured payment of the settlement by instalments over a number of years, in order to maintain the farm’s viability.

Jonathan, who is a family law expert and mediator, explained: “Carrying out this process thoroughly will mean being able to call on a team of professionals, rather than solely a family law expert, probably including an agricultural surveyor/valuer and an accountant.

“With expert advice and help, as well as a sensible approach, the farm can and will be saved, so that it can be passed on to the next and future generations.”