Wednesday, 6 June 2012
The Farmer wants a pre-nup
Buoyed by the continuing rise in the price of land, the Financial Times has recently reported a rise in pre- and post-nuptial agreements entered into by farmers.
As much of a farmer’s wealth is usually tied up in the land they work, many are trying to protect this asset, as well as the income which they generate from it, by asking their future spouse to enter into a pre-nuptial agreement, or a similar agreement once they have married (a post-nuptial agreement).
Whilst such agreements entered into between a couple are not legally binding in England and Wales, recent case law has increased their prominence and the weight which a judge will attach to them should a couple divorce. The court will hold the parties to the terms agreed unless: the agreement was not entered into freely by each party; they did not have a full appreciation of the implications of the agreement at the time of signing it; or it would be unfair to hold either of them to the agreement.
While courts are keen to avoid selling family farming businesses to make divorce payouts, there are no guarantees that even inherited land will be treated differently from other property and excluded from the total value of assets to be divided when the courts come to a financial settlement. The significant rise in the price of commercial farmland in some parts of the UK has prompted fears amongst farmers that it could form a greater percentage of the money being fought over on divorce. Farmers are therefore keen to do what they can to try and protect this land should their marriage break down.
Farming divorces can be more complicated to resolve than urban separations because most of a couple’s assets may not be in cash but tied up in a working farming business. As a result, a well thought out and carefully structured pre-nuptial agreement can got a considerable way towards protecting a farmer and removing the uncertainty which might otherwise exist.
Our family solicitors have considerable experience in drafting pre-nuptial agreements and advising on the terms of such documents.
For more advice on pre-nuptial agreements or any other family law issue, follow our family law blog or follow us on Twitter @Divorce_experts.