Family Law and Agriculture
Many family law issues require to be considered when it comes to farming. In particular, when it comes to any divorce of an individual within a farming partnership. Successful farming partnerships and, indeed, family business owners may wonder how to keep it all “in the family”.
One way of preserving the family element is by having the protection of a pre-nuptial agreement which can prevent court battles that expose the private financial matters of the business, can keep the family from being “taken to the cleaners” by unfair monetary awards or outrageous legal expenses, and ensure that ownership of the family business remains within the family.
Pre-nups are all about protection. If you want to protect your existing family business assets when you marry – perhaps for the benefit of your children from a previous marriage – you need a pre-nuptial agreement. The content of a prenuptial agreement can vary widely but commonly includes provisions for the division of property upon divorce and any rights to financial support during or after the breakdown of marriage.
Couples who both bring assets into the marriage, or who have been married before and have adult children or grandchildren, often find pre-nups helpful in ensuring that children from either side of the union are not disinherited and that assets are kept separate.
A pre-nuptial agreement can aim to exclude assets, or new assets acquired, from becoming matrimonial property. It can establish that your partner is excluded from making a claim against a particular asset, no matter the circumstances. This could also be useful if you have built up a family business before the marriage, such as a farming business, which then undergoes significant re-structuring over the course of the marriage. Normally, your partner could argue that the restructured business had become matrimonial property. With a pre-nup in place, that argument cannot be made.
If planning before marriage was not on the agenda, all is not lost - the flip side of a pre-nuptial agreement is a post-nuptial agreement. These can be used to ring-fence money which is inherited or gifted during a marriage and which is to be used to buy a joint asset or to restructure a family business.
A post-nuptial agreement provides details on how the couple’s assets and property would be shared on divorce, separation or death.
A post-nuptial agreement is similar to a pre-nuptial agreement except that it is made during a marriage or civil partnership.
Just as with a pre-nuptial agreement, it is a good idea to discuss the matter with your spouse or partner. Couples are now much more relaxed about discussing such matters. You need to agree on how you will share your assets and take into consideration any future income. If you can agree on these matters, it makes the process of obtaining a post-nuptial agreement much smoother.
Once the post-nuptial agreement is in place, you can still change and update the agreement if your circumstances change.
It is important that couples take independent legal advice from a solicitor at an early stage. Normally both parties will need to instruct different firms of solicitors to avoid any conflict of interest.
Our Family Law team can provide you with expert advice whether you are contemplating a pre-nuptial or post-nuptial agreement or a cohabitation agreement. The team will be happy to discuss your issues with you and provide you with the advice you require.