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Farmers Plough into Pre-Nups !


The Financial Times has recently reported that there has been a significant increase in the number of farmers signing up to pre and post nuptial agreements to protect their wealth from enlarged divorce payouts to their spouses. The reasons behind this are two-fold. Firstly, over the last 5 years the price of farmland has seen a significant increase from an average of £3,000 per acre to £6,000 per acre.

Farmers and their family members need to be aware that under matrimonial law inherited property such as a farm is not automatically ring fenced and protected on a divorce. The court is entitled to take all assets into consideration and if those assets are needed to ensure the parties’ needs are met – then this will take precedence over where the asset came from. Matters are more complicated in farming cases as the matrimonial home is often the farmhouse and surrounding land as so its value is normally taken into account by the courts and added to the matrimonial pot for division.

Coupled with the increase in value of farmland is the increasing weight that courts will now give to pre and post nuptial agreements. In the recent Supreme Court landmark decision of Radmacher -v- Granatino it held that courts should give effect to a nuptial agreement freely entered into by each party with a full appreciation of its implications unless in the circumstances prevailing it would not be fair to hold the parties to their agreement. This decision has given significant weight to the signing of nuptial agreements, which had previously provided little guarantee upon the breakdown of a marriage.

All farmers should now seriously consider entering into either a pre-nuptial or post-nuptial agreement to protect their family wealth from enlarged divorce payments which otherwise would go to their spouse.

If a farmer does not enter a pre- or post-nuptial agreement then they can be faced with the very unwelcome prospect of either selling farmland or borrowing money to finance a fair divorce settlement.

For expert and specialist advice on pre-nuptial and post-nuptial agreements please contact Suzy Hamshaw on 01635 521212 or suzy.hamshaw@clmlaw.co.uk

 

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Suzy Hamshaw
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Suzy Hamshaw

August 10th, 2012 at 10:38 am