These statistics affect farmers as much as the general population, however, for farmers, in common with other business owners, the financial and emotional fall-out following a divorce can be disastrous for the family, potentially leading to the break-up or sale of the farm.

In all divorces, the starting point is equal division of the matrimonial assets and, in most divorces, the most valuable of all the assets will be the former matrimonial home and any family business.

Pre-nuptual and Post-Nuptual Agreements

Given what is at stake and the attention that most farming families rightly give to active succession planning, serious consideration of pre/post-nuptial agreements should be part of that succession planning process.  These agreements set out in detail what will happen financially if the marriage ends and provide some security and reassurance for both spouses and for other family members involved in the farming business.

Although pre/postnuptial agreements are not yet legally binding in the UK, they have become increasingly taken into account by the courts in England and Wales following the landmark Supreme Court judgement in the case of Radmacher v Granatino in 2010, where the judge took a pre-nuptial agreement into consideration when determining the financial settlement.

The court in that case handed down guidance as to the essential pre-requisites before entering into such agreements, including that the agreement is entered into freely and willingly by both parties and that it does not result in an unfair settlement for either spouse. Each party should obtain independent legal advice before signing the agreement, which should be finalised in good time, and certainly not on the eve of the wedding!  Observing these formalities will significantly increase the chances of the agreement being fully upheld by the court in any subsequent matrimonial financial proceedings.

It is true to say that most of us do not consider such agreements to be romantic but, as a means of protecting a farming family’s livelihood, they are an essential aspect of the family’s succession planning. It is a little-known fact that spouses who have lived with each other before committing to marriage will have those years added to the length of the marriage.  Potentially, this can make a huge difference in terms of what is a fair settlement.  Farming families are becoming increasingly business savvy with some even including a clause in their partnership agreement providing that children joining the partnership enter into pre-nuptual (or even co-habitation agreements) before tying the knot or living together.

Ann Hallmark

Senior Family Solicitor

Walker Foster, Skipton