What happens to the family farm in a divorce?
Posted on 11th June 2021
Our specialist divorce solicitors discuss the process of dividing a family farm business in a divorce.
If both parties are not on the same page, Divorce can be a complicated process. However, for those couples and families who own and run a farm together, it can be even more complex. Chances are if you live and work on the farm, then your livelihoods will be inter-twined even more than the average couple, especially if you live on the farm with your children and family.
In this post, our expert family law team run through the possible difficulties that can occur when going through a divorce that involves a family farm and business.
Why do family farm businesses complicate divorce proceedings?
Generally, couples who own family farms will have their family home located within the farm, and will both rely on the farm business as their sole income, on a self-employed basis. This is a unique situation, as a farm business is not simply one that can be split equally between the couple, it relies on the location and the land of the farm itself.
In more specific terms, there are a number of complications that can arise from the inclusion of a family farm in a divorce which can prolong the process, all of which our divorce and family law experts at MG Legal have experienced over the years.
These include, but are not limited to:-
The farm’s land being shared both between the couple, as well as multiple other family members involved in the business
Older members of the family, such as the couple’s parents, who still rely on some form of income from the farm despite not completely owning it
A lower amount of income, or cash wealth, with a large amount of money tied up in assets is common for family farms. This makes the dividing of assets all the more important, and complicated in nature
More complex tax processes and implications than that of standard businesses or jobs
Both parties involved feeling strongly about wanting to keep the farm, as it is so integral to not only their income and business, but their family and way of life
The farm may have been inherited from the family and older generations of one party in the couple. Still, this does not mean that the other is not a large stakeholder in the farm, and that their life does not revolve around it in the same way
What if the family farm was inherited?
Generally, it is uncommon for a family farm to be a first-generation ownership. Land prices are higher than ever, and most existing farms have been kept in the family and passed one or generations.
In these situations, it will surely come as no surprise to you that the person whose family owned the farm will have a legal advantage in the divorce proceedings. When the Court reviews the case, they could well class the farm itself as a ‘non-matrimonial asset’, meaning that it does not class as a shared asset in the marriage.
However, it is rarely as simple as this. Many times, the other spouse will become involved over the years, for example acquiring loans to extend the land and purchase more. In this instance, it would be unfair to class the entire farm as non-matrimonial, as they would have part ownership of the land that is meaningless without the farm itself.
The farm is part of my partner’s family. What will happen to me in the divorce?
While the non-inheriting member of the couple cannot expect the same share of the farm in the divorce proceedings, the Court will do their best to ensure that this person has their needs met, and is financially stable with adequate housing provisions. This is even more important If there are any children involved in the divorce, and especially if they will be moving off the family farm as a result of the divorce.
What are our options regarding the divorce?
As with all divorce situations, there are a large number of options and possibilities for how to split the assets, including the farm. What is best will depend entirely on you as a couple. If you and your spouse wish to have the most say in that the outcome will be, it is a good idea to work together on a post-nuptial agreement, this is provided that you don’t have an existing pre-nuptial agreement already in place.
If you have any questions about your specific situation, or would simply like to speak to an expert, contact our specialist divorce and family team at MG Legal today. Our family solicitors are well-versed in all aspects of divorce law, and there really is nothing that we have not seen and experienced in the Family Courts. Contact our offices in Lancaster, Garstang, or Longridge for the Preston areas, here, or via email at email@example.com .
MG Legal - Your Local Solicitors
Share this post: