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The division of a farm on divorce can be a highly complex and sensitive matter.
The court is often faced with a dilemma in weighing up the need to provide for the non-farming spouse fairly on divorce whilst preventing irreversible damage to the farm.
There is a wide range of reasons why divorces involving an interest in a farm can be laden with complexity:
As a result, valuing farm buildings, land, agricultural stock, and machinery is a highly complex task and requires the assistance of a RICS surveyor, who will need to be jointly appointed by both spouses.
Often, the courts are required to adopt creative solutions to resolve the issues faced with the division of a farm on divorce.
The following options have been utilised by the courts when handling the division of farming interests on divorce as part of the financial settlement:
In farming cases, variations of settlement applications can arise as follows:
i. the marital home may be a farmhouse occupied by the parties but held on trust for future generations of the family. If this trust is a nuptial settlement, it may be open to variation to provide access to capital. The property could be sold, remortgaged or provided as a place to occupy by the non-farming spouse for the rest of their lifetime.
ii. If the farmland is held on trust and the trust structure is relied on to oppose an order for sale, a variation application may free up the land from the restrictions of the trust.
iii. If other assets of the marriage are held in trust, a variation application may release assets so as to enable the farm to be retained intact.
One spouse can retain the farming company, whilst the other spouse is awarded the farmhouse as the former matrimonial home.
Award substantial maintenance payments in return for a smaller lump sum
Let relations assist with raising capital.
Sell part of the farmland and provide for a lease of the land back to the farm.
Investigate development potential and suggest ways this can be developed as an independent business.
Transfer illiquid assets to both parties so that they have a stake in illiquid assets.
Impose a deferred order for the sale of the farm.
Make enquiries with Agricultural Mortgages Corporation Plc, which specialises in long-term agricultural secured loans.
Investigate the potential of assigning tenancies.
If you need professional legal advice for any agricultural or family matter, please contact Myerson Solicitors on: