“Buy land, they’re not making it any more”
Mark Twain hit the nail on the head when it comes to farming. And when it comes to a divorce where a farm is involved, farming cases are in a field of their own when it comes to the court’s approach. In this post, we explore the route taken by the court in a divorce which involves a farm or farming assets. It is a highly specialised area of family law.
The lowdown on the Farm
The court looks principally towards the housing and income needs of the wife (in this scenario we assume that it is the husband who has the farming background). This approach is favoured over the ordinary ‘sharing’ or percentage-based approach. The relevant legal guidance is found in two leading cases:
Firstly, the judgment of Munby J in P v P (Inherited Property) [2005] 1 FLR 576:
“[44] … the proper approach was to make an award based on the wife’s reasonable needs for accommodation and income, not because that was the principle to be applied to all farming cases, but because of the circumstances of the case, in particular that the bulk of the family’s assets represented a farm which had been in the husband’s family for generations, and which had been brought into the marriage with an expectation that it would be retained in specie; that although the farm business had been in joint names, the land had been retained in the husband’s sole name; that any other approach would compel a sale of the farm, with devastating implications for the husband; and that this approach would meet the wife’s reasonable needs. To give this wife more than she reasonably needed for accommodation and income would tip the balance unfairly in her favour and unfairly against the husband”
And more recently, Baron J’s decision in Y v Y [2012] EWHC 2063
“[28] … b) The origin of the wealth is on the Husband’s side. Prima facie, this makes it non matrimonial property and places it in a special category. As such the court should be slow to invade it without good reason. Nevertheless “In the ordinary course, this factor [inherited property] can be expected to carry little weight, if any, in a case where the Claimant’s financial needs cannot be met without recourse to this property”: White v White [2000] UKHL 54, [2000] 2 FLR 981 at 994G.
c) Accordingly, I accept that primarily this is a needs case given that the Estate was pre-acquired, [….]
i) The subsequent jurisprudence, while acknowledging the potential application of the sharing principle to inherited wealth, has tended towards a needs-based determination. Plainly, as Mr Marks QC puts it: “there is a graduated scale or spectrum of kinds of inherited wealth and circumstances relevant to the question of sharing. Factors relevant to likelihood of sharing might include:
i) the nature of the assets (eg land/property, art, antiques, jewellery on the one hand, and cash or realisable securities on the other);
ii) whether the inherited assets have been preserved in specie or converted into different assets, realised or even spent;
iii) how long they have been ‘in the family’;
iv) the established or accepted intentions of both the previous holders of the assets and the spouse who has inherited them;
v) whether they have been ‘mingled’ (for example by being put into joint names of the spouses, or by being mixed with assets generated during the marriage);
vi) the length of the marriage and therefore the period over which they have been ‘enjoyed’ by the other spouse;
vii) whether the other spouse has directly contributed to the improvement or preservation of the inherited wealth.”
These 7 factors as outlined by Baron J are useful guidance and provide a checklist to apply to all farming cases. They must be considered alongside those found at Section 25 of the Matrimonial Causes Act 1973. However, there are other features that crop (excuse the pun) up in farming cases, such as:
- Liquidity – more often than not the capital in the case is the farm land and buildings, which generate the income. It can be difficult to release that capital without damaging the income for the farm – a knock on effect of which would be to reduce income available for maintenance.
- Family members – often the farms are held by more than one generation and by siblings. There are frequently trust arrangements, tenancies and commercial entities involved between family members, some of whom may also occupy properties on the farm. This can also cause friction and emotional conflict between all generations. In our experience mediation can often be very helpful in such situations.
- The ‘Country Life’ – the farm is not just a home and business but a way of life. It can be nigh on impossible to replicate that lifestyle away from the farm – hunting, fishing, stables, liveries and such like are not easily transplanted away from the farm following the divorce.
These are just a few of the considerations and factors that are more peculiar to farming cases than any other. Farming cases can be very difficult to unpick for a matrimonial court. It can hopefully be seen from the information outlined in this post, that farming cases are a highly specialised area of family law. Farming cases should only be undertaken by family lawyers with experience in dealing with farms or farm assets.
Farming expertise
It is vitally important where there is a farm involved for specialist family law advice to be taken at the earliest opportunity. At Paradigm Family Law we have that expertise. James Thornton regularly deals with farming cases, and has a proven track record in this area of family law. We offer fixed fees for divorce and financial proceedings.
If you have a farm and find yourself going through or contemplating separation or divorce, do not hesitate to contact James on 0845 6020422 or email him at [email protected] and make arrangements for a free initial consultation.
