Some of the bitterest family disputes happen in farming families.

The emotional elements involved in owning land, living on the farm, and keeping control of that land all come into play.

The emotional intensity is seldom matched in any other industry.

Farmers make decisions every day. Most are routine, but some decisions can prove to be very difficult and one of the most difficult decisions can be to decide who should own and run the farm when the farmer retires.

Surveys show that many farmers fudge or postpone the implementation of a fully documented and agreed succession plan. This can be a very emotional process.

Different situations

How can you be fair to all your children? If you have only one child, you may think there is no problem, but what if your child isn’t up to the task?

What if you have more than one child and they show different levels of ability or interest in taking over the farm?

What if you believe that the oldest son should get the farm, but he is not the most talented of the children?

What if your chosen child feels compelled to work on the farm but their heart isn’t in it? There is diminishing interest by some next generation children in taking over the farm.

Guiding principles

In succession planning, there are a number of guiding principles that may be beneficial.

1 Succession planning is not decided in a day or at one family meeting. It is a process that can take a long time to finalise. Circumstances change as children get older.

2 Start thinking about it as early as possible, planning well in advance.

3 While encouraging the children to enjoy the farm and farm work, be careful not to say things like “This will all be yours someday” as young children may interpret this as being “trapped”.

4 Talk as a family about the future and listen to all family members and their view of the future. Don’t make this conversation a competition but a constructive dialogue.

5 Make sure you, as the owner, are ready mentally to start the succession planning process. Many older farmers don’t like talking about succession. They may be struggling with facing their own mortality or may have a fear of retirement. Maybe, they have no hobbies or pastimes other than the farm and worry about what they would do if they retire.

6 Make sure you are clear about the difference between ownership of the farm and who will run the farm. They may be the same person or persons, but they don’t have to be.

7 The right decision made about the future of the farm may not be the right decision or popular decision for the family. You must decide is it farm first or family first. Ideally, you can satisfy both.

Outside help

Many family conflicts have started as a result of either the children feeling obliged to run the family farm or them wanting to work on the farm, but also wanting ownership of the farm.

Families can benefit from an outside adviser who would sit with the family and help them with these conversations. Don’t confuse this with a mediator.

The outside adviser not only needs to be able to facilitate the conversations and try and mitigate conflict, but the adviser also needs to be the chair of a team of advisers – the Teagasc agricultural adviser, a mediator (if required), your solicitor, your accountant, and your tax adviser.

The adviser might also have to talk to your children’s solicitors, their tax advisers etc.

In my experience, if you don’t put someone in overall charge of the process and you yourself try to co-ordinate all the moving parts – family, legals, financials and do the day job as well – it is near impossible to keep all the balls in the air.

The adviser must be a fully rounded businessperson, capable of understanding your farm and its operations, understanding the role of mediation, understanding the interconnection there is between decisions and tax, decisions and your bank attitude, and decisions on transfer of ownership but above all the person must be an expert on family dynamics.

To find the right adviser is not easy. Someone who has all these different skills and experience is difficult to find. Quite often you need to think about the role differently than the traditional advice given by Teagasc and others. You need to find one person – as the Italians would say, a consigliere – one person that can take overall control of the process. Expecting a family member or members to coordinate this highly complex and emotional journey is fraught with dangers and doomed to failure.

Think of finding a retired business managing director, maybe someone that ran a food factory or co-op or a retired bank manager to manage your team of advisers for you and the rest of the family.

Paul Keogh is the author of The Family Business Book that gives practical tips to help families navigate their way through the complexity of being a family and also running a business together. The book draws on Paul Keogh’s expertise and decades of working with family businesses and family farms of all sizes.

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