On any divorce it can sometimes be difficult to divide the assets available, but when the main asset is a farm this can become even more complex if the correct legal advice is not available.
The key to resolving cases which involve a working farm is to make sure that all the assets and income are understood, correctly identified and valued. It is also important to understand the history of the farm and how it works on a day to day basis. Often the farm supports more than one family and financial arrangements can be complicated.
When I am considering a farming case the start point is to identify the assets and income;
Once we have the assets clearly identified we can value them and then have the farming business as a whole valued. Tax considerations are often different for agricultural land but have to be considered to achieve a net value. Liquidity is then considered as to whether land could be sold to meet the financial claims arising on divorce or whether the bank will lend further monies if cash is not readily available.
Whilst the start point for division of assets on divorce in most cases is one of equality, farming cases - where the farm has been in one spouse’s family for generations – usually provide an exception to that approach. That important contribution however has to be balanced against the need of the other spouse to be housed particularly if children are involved.
These are just a few of the issues a solicitor needs to consider on any farming case on divorce. Without these issues being fully considered, it is inevitable that one or other spouse is likely to have the wrong outcome on his/her financial claims on divorce.
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