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Farming families need to plan to avoid future divorce difficulties

25 Apr 2022

The biggest change in the divorce law in over a half a century has brought family law right back into the media spotlight.

From 6 April, if one spouse decides that a marriage has irretrievably broken down, they can apply for a divorce without needing to do so on the basis of adultery, unreasonable behaviour, or a period of at least two years separation.

There is also an option for a joint application for divorce, while the ability to contest a divorce has, in almost all cases, been removed.

The idea of the changes is to simplify the divorce process and to try to remove as much of the emotional and acrimonious challenges that are inherent within it.

Divorce can be a complex enough process at the best of times, but when set in a farming context, dealing with the complexities can be even more challenging.

The changes to the law have provided a useful reminder of just how important it is for farming families to do as much planning in advance as possible for managing future situations which, while no-one wants to think about them at the beginning of a marriage, will be far easier to deal with if they do arise.

A failure to do this can sadly have an impact on more than just the divorcing couple and can echo down the generations.

We regularly deal with cases where, due to the lack of up-to-date partnership agreements, ownership documentation and shareholder agreements, the assets of parents and even grandparents can come into unwelcome focus within divorce cases.

It may never have been, for example, the intention for parents to give ownership of assets to children who are working with them in a farm business, but if it is not made clear in the appropriate legal documents, exactly who owns what can easily be called into question.

farming families divorce

The cross- and inter-generational nature of farming enterprises, and the land and asset ownership arrangements that go with it, often mean that finding documented proof of who owns what is not always easy, as assets may have been within the family for generations.

Gaining clarity on all such arrangements is the optimum way to structure the ownership of your farm and assess the value of its assets, and requires the same methodical approach that farmers take to their day-to-day operations.

The expert legal advice required to execute this process also needs to be seen in a ‘cost/benefit’ context, with the investment you make in ensuring all your documentation is legally sound being substantially less expensive than the potential implications of not having everything in order.

This work should form part of the wider succession, tax and inheritance planning process for the business, and will benefit it in the long-term even if, as everyone would hope, there ends up being no unpleasant reasons for the ownership structures to be brought to the fore.

For advice on all aspects of agricultural, rural and family law, please contact us on 0191 232 8345.