Divorcing a Farmer

Many people assume that divorcing a farmer is no different from any other type of divorce, and in some ways this is true. However, farms as businesses are distinctly different from most other types of business and it is for this reason that the nuances of the law can be quite variable.

Indeed, when it comes to getting divorced, dealing with farming as a business is generally much more difficult than most other types of business for a number of reasons. Generally speaking, the amount of capital invested is very high compared to the regular income, especially when one considers the value of the land and machinery. Often, the farm also consists of a family home whereas most other businesses do not. It is for this reason that farms are often referred to as being ‘lifestyle businesses’.

Because farms are so capital-heavy, they tend to be inherited and passed through generations rather than bought or set up, and for this reason they are often not divided equally upon divorce as they are assets which are only acquired by the partner by marriage in the first place. The ownership of the farm usually goes much wider, too, with extended family tending to have some sort of stake in the farm, particularly as far as capital goes. This can make the division of assets particularly messy.

Farmers – asset rich, cash poor?

With farms largely consisting of capital as opposed to strong income streams, the liquidity of them tends to be low. Asset rich, cash poor is probably a good way of describing many farmers. This means that extracting value from the farming business in order for the departing partner to buy a new property can often be very difficult. Selling the residential property is usually not an option as it forms part of the farm business and lifestyle itself.

If you find yourself divorcing a farmer, you will definitely need to seek good legal advice. Documentation regarding the ownership of land, mortgages and business interests will all need to be provided in order for your solicitor to be able to build up a true picture of how things are structured.

Farm divorce – problems in raising capital

Your solicitor will be able to offer advice as to how to raise capital to meet the housing needs of both partners, either though the sale of capital or land or the borrowing of funds. It’s worth noting, though, that courts tend to try to protect farms and businesses from any activities which might damage it or its core activities. They are also reluctant to affect third parties, so wider ownership of the farm may complicate things further. It is worth noting that courts don’t often order that a farm be sold, although they may well do if they decide that it is not a viable business. Your solicitor, however, will be best placed to advise you on this.

If your farm involves the ownership by a trust of some sort, then the matter can be complicated even further again. Contacting a specialist divorce solicitor when divorcing a farmer, ensuring that your rights and business are protected and that the outcome is one which all parties can be happy with.

Divorcing a farmer? Call our specialist Divorce Solicitors today

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