“I have been farming in partnership with my father for the past number of years. My father, who is nearly 80, is the sole owner of the land, which is in two blocks – the home farm where my parents live and the outfarm where I live with my wife and children. “A few years ago before I turned 35, my father and I agreed that it would be tax efficient to transfer the outfarm over to me. I am the eldest of six siblings and all were happy with me getting the farm. However, a document was produced for my mother to sign and she refused to do so, saying that I was too young to get the farm and didn’t deserve it yet. “My father is leaving me the farm in his will. I am now nearly 40 and my wife and I are getting worried about the situation, as if anything happened to me, she would be left in a very difficult situation. “I also don’t want to be too old for claiming grants. Have you any advice?”
It is an unfortunate situation you find yourself in and you will need to thread carefully to prevent a fall-out among the family.
However, something needs to be done, as you have highlighted the precarious position your wife and family could find themselves in should anything happen to you.
Indeed, even if your father has left the farm to you under his will, your mother is entitled to her legal right share, which is one third of your father’s estate. This could cause difficulties when the estate would come to be administered if most of what your father owns is the farm.
Legal right to block transfer?
From a legal viewpoint, your mother is not entitled to block the transfer. The document she was required to sign was most likely what is referred to as a “family home declaration”.
The Family Home Protection Act was introduced to prevent a family home from being sold out from underneath a non-owning spouse.
While the legislation does not require the production of a statutory declaration by way of proof as to the situation of the family home, ie that the property to be transferred does not contain a family home, it is now standard conveyancing practice to produce one as part of the transfer.
However, as your parents’ family home is located at the home farm which is not being transferred to you, it would appear that prior consent of your mother under the Family Home Protection Act is not required.
Scope to challenge transfer after farm transferred?
That being said, that declaration also contains a paragraph to the effect that no proceedings have been instituted or threatened under the Family Law Act, the Judicial Separation Act and the Divorce Act.
Could your mother claim at a later date that she had threatened your father with family law proceedings prior to the transfer?
If those proceedings were instituted, your mother could seek to have the transfer reversed on the basis that your father was doing so for the purposes of defeating a claim she might have for relief in separation/divorce proceedings.
Another aspect to be aware of is that a presumption of undue influence applies to a family voluntary transfer case, ie a presumption that you are forcing your father to transfer the farm over to you against his will.
Thus you must be able to prove that there was no undue influence and this is normally achieved by your father having received independent legal advice in advance of the proposed transfer.
However, as the law now requires each party to be separately advised by separate solicitors, it should be possible to rebut this presumption.
Another aspect to be aware of is to ensure that your parents have sufficient financial security after the transfer, otherwise your mother could challenge the transfer on the basis that it was “an improvident transaction”.
There is no presumption that a transaction is improvident; it is up to the court to decide and if it decides it was improvident, the court may set the transaction aside.
However, given that it is proposed that your parents will retain the home farm, they should have sufficient means to maintain a reasonable lifestyle.
Next steps
While from a legal viewpoint your father should be able to transfer the outfarm over to you without your mother’s prior consent, it would be preferable to have your mother’s consent and blessing.
Perhaps you could speak with your mother and explain your concerns and try to alleviate any concerns that she may have.
If this conversation proves difficult, perhaps you could enlist the help of a trusted family friend or professional, such as an accredited mediator who will help in bringing about a resolution to the matter.
In the interim, perhaps your father could change his will to provide for not only you, but your wife and your children in the event that anything should happen to you.
Also from an age point of view, the key age was 35 in order to avail of the young trained farmer stamp duty exemption, so unfortunately you have missed this date.
That being said, you could avail of consanguinity relief for transfers on or before 31 December 2015, whereby the rate of stamp duty would be 1% of the value of the land; thereafter, it would be 2%.
You mention that you are farming in partnership with your father, thus it should be possible for you to apply for the Young Farmer Top Up provided you satisfy the terms and conditions of the scheme.
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