Thursday 27 November 2014

Caitriona Murphy: Why farm couples should take a lesson from Kim and Kanye

Published 04/11/2013 | 02:00

Kim Kardashian and Kanye West
Kim Kardashian and Kanye West
Solicitor Anne O'Neill
Tom Doyle of the Irish Farmers' Association

AN exit strategy, an insurance policy, a disaster strategy – call it what you like – a pre-nuptial agreement is the outline of what you want to happen to your assets in the event of a marriage breakdown.

The news this week that Justice Minister Alan Shatter intends to include pre-nuptial agreements in the upcoming legal review has revived the controversy that surrounds divorce in deepest rural Ireland, where the mere thought of a divorce lawyer walking to the family farm is enough to bring on palpitations.

The notion that a woman who marries a farmer walks up the aisle with a bunch of flowers and walks down again with half the farm in the pocket of her silk dress is one that has terrified Ireland's farmers ever since divorce was legalised in 1996.

Ensconced in their Bel Air mansion, Kim Kardashian and Kanye West may, at first glance, have little in common with Seamus Murphy and Maire Ryan in Ballysearrach, Co Kerry.

But the couples could be singing from the same hymn sheet when it comes to pre-nups – everyone want to protect their assets in the event of marriage breakdown.

Kim and Kanye have already agreed to keep their assets separate by drawing up a prenup before they tie the knot.

They're commited to their marriage, but they are shrewd business people who know that it's best to have a prenuptial agreement, given their vast wealth.

The scale is wildly different – $130m (€96m) in the case of Kim and Kanye and a 130-acre farm in the case of Seamus and Maire – but the division of those assets is no less contentious.

The Irish Farmers' Association (IFA) has revived its campaign to get farm assets ringfenced and protected in the event of a marriage breakdown, thereby preventing a family farm from being broken up in the divorce process.

The IFA campaign to have pre-nups recognised by law began almost three years ago.

The organisation claims that the fear of losing farms that have been in families for hundreds of years is preventing the timely transfer of land to the younger generation.

"IFA's interest in the issue of the legal status of pre-nuptial agreements arises primarily from our policy of seeking to ensure that the inter-generational transfer of family farms takes place in an orderly and timely fashion," said IFA farm business chairman Tom Doyle.

"Our own analysis shows clearly that farmers are concerned at the potential implications of transferring the farm, which may have to be broken up subsequently in the event of a marriage breakdown."

Mr Doyle added that legally binding pre-nuptial agreements "could go a long way towards allaying these fears, while also protecting the rights of both parties".

The age structure of the agriculture sector is top heavy with older farmers.

In fact, just 6pc of all farmers in Ireland are aged under 35 today – compared to 26pc in the 1970s. One of the big blockades to farm transfers from the older generation to the next is the fear of losing the farm.

Earlier this year, a Macra na Feirme survey found that 65pc of farmers aged over 50 who have not yet identified their successor said it was important for them that their farm stayed in family ownership. In fact, 23pc insisted that it was important that the farm stayed in their own family name, indicating that they were even reluctant to transfer land to their married daughters who no longer had the family name.

This vice-like grip on the land is behind hundreds of doom-laden warning tales about the farmer who married "a girl from the town" and subsequently lost part of the land that had been in the family for generations.

The same emotional attachment has seen public auctions of land disrupted by angry family members and is the cause of bitter disputes among families when romance turns sour. Of course, it's not all about the gra for the land – the land is also a business asset and the means of generating an income. At an average land price of €10,200 per acre, a farm of 100 acres has an asset value of more than €1m.

In the midst of a bitter divorce, that is plenty to fight over. However, the IFA insists that the asset value of a farm should be ringfenced because – unless that farm is kept intact – its income-generating potential is destroyed. The association has a point.

A dairy farmer running 90 cows on a 120-acre farm has no hope of maintaining the same income on a smaller block of land, while a suckler producer is already to the pin of his collar to produce an annual income of €12,000 on an 80-acre farm (Teagasc National Farm Survey 2012).

Divorce on a farm also throws up other problems that simply wouldn't occur in other businesses. A typical Irish farm has the family home built at the centre of the farm and embedded in the farmyard.

In cases involving children, the mother is often awarded the home to rear the family in their familiar environment. This can result in the farmer renting a house away from the farm, several miles from cows calving and sheep lambing.

It's the equivalent of a dentist's wife being awarded the dentist's chair at the centre of his practice. If Mr Shatter's legal review gives pre-nups a legal basis in court, farmers could become their earliest adopters in an effort to protect their assets.

In fact, some forward-thinking farmers have already drawn up pre-nups in recent years in the hope that the documents would eventually become legally binding.

Family law solicitor Anne O'Neill welcomed the prospect of pre-nups for farmers.

"I would be very enthusiastic about any change that treats adults in an adult fashion and given the importance of agriculture in Ireland's economy – it isn't good for either farmers or our country to have farms divided in such a way that would render them unviable," said Ms O'Neill.

However, the introduction of legally binding pre-nups is likely to open up a huge can of worms for young farmers.

Will prospective romances with farmers die a sudden death the minute a pre-nup is mentioned? When should a young farmer mention that he wants a pre-nup – during the first fumble in a nightclub or in a glitzy restaurant as the waiter serves champagne with a diamond ring at the bottom?

Perhaps it should be included in the small print of the terms and conditions for Macra na Feirme or included as a waiver on Facebook's Farming Banter page.

While the advent of legally recognised pre-nups will be welcomed by farmers, the likelihood is that some of the biggest benefactors from the move could be the legal professionals who will be called in to sort out the mess afterwards.

"The biggest pitfall for farmers who want to implement a pre-nup would be that they take a 'do it yourself' approach," warned O'Neill.

"Both the landowner and the person marrying into the farm need to take proper independent legal advice from a solicitor familiar with family law well ahead of the marriage date."

The Cork-based legal expert warned that any pre-nup that did not involve full and frank disclosure of all assets could be dismissed in future divorce proceedings.

"Any suggestion that the wife was 'hoodwinked' or the pre-nup was not done by the book and it could be set aside by a judge," she warned.

Irish Independent

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