Farm succession advice

stumpy24 · 04-11-2013 12:02am #1

I'm looking for some advise on the matter below. I'm hoping someone has come across a similiar scenario....ive made this impersonally as possible.....

A farmer has decided to sort out his affairs as he is currently unwell & time is critically. He has decided that he does not want to split farm between 2 siblings but that 1 sibling will receive 100% of the farm on his passing. He also wishes for the sibling receiving farm to compenstate the other sibling who is receiving nothing in his will. He wants to ensure that the farm remains intact but surely there are other ways of doing this without giving the complete farm to one sibling. Is there anyway that the sibling not getting anything can become a stakeholder in the farm & receive an annual income from this. I'm sure this is fairly common occurence but as I'm not familiar with how these are resolved I'm at abit of a loss & time is not on our side. I believe if this matter is not resolved before his passing it will led to the breakdown of relationships due to the way the farm is been given over to one sibling.

Does anyone know of a company that speciaists in farm succession/inheritance/management/partnerships etc.

dar31 · 04-11-2013 8:44am

you need to talk to a solicitor, independent from the will proceedings.
got to firm with plenty of experience, its important that they have some one who specializes in agricultural matters.
where are you based. my one is very good at agri related maytters

mf240 · 04-11-2013 9:11am

Just one thing. If a farmer has not put a lump sum aside out of a lifetimes farming, where does he think the sibling who is going to farm is suddenly going to find one to give to the non farming sibling.

rancher · 04-11-2013 9:28am

mf240 wrote: »

Just one thing. If a farmer has not put a lump sum aside out of a lifetimes farming, where does he think the sibling who is going to farm is suddenly going to find one to give to the non farming sibling.

You'd hope he made those conditions known to the farmer when he started farming, he'd be far better to pay off the sibling on day one and have it sorted,
He could then use his lump sum to buy land, that is if he wants an income from land,
The successor would still have a cheap farm

mf240 · 04-11-2013 9:41am

rancher wrote: »

You'd hope he made those conditions known to the farmer when he started farming, he'd be far better to pay off the sibling on day one and have it sorted,
He could then use his lump sum to buy land, that is if he wants an income from land,
The successor would still have a cheap farm

I suppose you are right up to a point,

But just look at it this way, if the successor had worked on the farm from a young age and sacrificed other opportunities, while at the same time the other siblings were well educated, and that education was paid for by the farm then they are allready looked after.

It's hard enough to make a go of a farm without having to pay out a lump sum on day one.

I just think if the farm was unable to provide this lump sum up to now, it's hard to expect the successor to be able to pay it.

20silkcut · 04-11-2013 10:21am

Can the farmer leave the farm to his surviving spouse and let the offspring who demonstrates the greater passion for farming over the coming years inherit it.
Rather than giving it all to one right now.

onyerbikepat · 04-11-2013 10:29am

20silkcut wrote: »

Can the farmer leave the farm to his surviving spouse and let the offspring who demonstrates the greater passion for farming over the coming years inherit it.
Rather than giving it all to one right now.

Don't do this. Only 'kicking the can down the road'. I know someone in a similar situation and it led to a lot of grief. Get it sorted once and for all.
If the father cant sort it out. How will it be any easier for the mother.

whitebriar · 04-11-2013 11:31am

Lordy,give the other sibling a site and leave it at that.
giving a 2nd sibling a guaranteed income from the farm would be a disaster in my opinion.
The farm needs its viability and one master.

if it is big enough,a 250k plus milk quota size for example,and the land in big enough blocks,then you could consider a partnership maybe.Otherwise forget it.

rancher · 04-11-2013 11:37am

mf240 wrote: »

I suppose you are right up to a point,

But just look at it this way, if the successor had worked on the farm from a young age and sacrificed other opportunities, while at the same time the other siblings were well educated, and that education was paid for by the farm then they are allready looked after.

It's hard enough to make a go of a farm without having to pay out a lump sum on day one.

I just think if the farm was unable to provide this lump sum up to now, it's hard to expect the successor to be able to pay it.

Obviously the owner feels the non farming son/ daughter is entitled to it, if it goes in the will it will have to happen.
If it happened in your case, would you rather pay a lump sum or have your brother/sister involved in your farming into the future.
You'd probably never be able to get a loan without their signature

brian_t · 04-11-2013 11:49am

stumpy24 wrote: »

He wants to ensure that the farm remains intact but surely there are other ways of doing this without giving the complete farm to one sibling.

Unfortunately a lot of farms are not able to provide an income for more then one family and therefore the sibling losing out just has to accept this and move on.

I doubt you can leave an asset to someone in your will with the proviso that they compensate a third party. I would imagine that you can only give instruction for what happens to your own assets.

I would say that in a lot of cases where a Farmer leaves his farm to just one of his siblings - this doesn't actually lead to the breakdown of relationships. Most families will just respect the fathers decision (obviously some won't though)

Farmer Pudsey · 04-11-2013 12:18pm

Stunpy it is very hard to give advice without out a few finiancial facts. Is it a substancial farm. What is the value stock, Machinery, SFP etc. Id the owner's spouse to be maintained out of the farm.

Will the proposed sucessor farm full time or have they a job as well. Had the other Sibling worked on the farm as well or are they miles away from the farm.

At the end of the day a one off payment is the most workable solution however this will never reflect the value of the farm.

restive · 04-11-2013 1:08pm

If one person is getting the entire farm, by far the best way is for the farmer to transfer the property into the joint names of the existing owner and the new owner. Then when the farmer dies the property is in the name of the new owner with a minimum amount of legal work.

Farm succession advice

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