Bitter Inheritance Disputes Centred Around Family Farms
Barely a month has gone by in the last year without the national press reporting on another bitter inheritance dispute centred on a family farm. In January, The Sun ran the headline “Farmer’s son cut out of dad’s £3m will in bitter legal wrangle with mum and sister … despite devoting his life to maintaining farm” (Thompson v Thompson  EWHC 1338). In March, the Daily Mail reported on the “Daughter who worked 70 hours a week at 220-acre family farm before quitting over a ‘fight in the milking parlour’ wins £1.1m stake in it after court battle with her 81-year old mother” (Habberfield v Habberfield  EWHC 317 (Ch)). In June, Farmers Weekly featured a piece entitled “Farmer wins multimillion pound court case against father” (Gee v Gee  EWCH 1393 (Ch)). And last month, BBC News published an article on the “Man who doesn’t like cows’ in farm inheritance battle” reporting on details of a dispute currently going through the High Court concerning a dairy farmer’s son who is said to have been written out of his parents’ wills despite having worked on the family farm since the age of seven years old and having been assured that it would one day be his.
The common theme in each of these cases is a purported reliance by the adult child on a promise from their respective parents that one day the farm in question will be theirs. This assurance gives rise to a potential claim on the basis of a proprietary estoppel, an equitable concept which arises in circumstances whereby (1) there is a representation or assurance made to an individual that he or she has or will enjoy some right or benefit over the owner’s property and (2) the individual relies on that promise to his or her detriment. The consequent inheritance dispute comes to be upon the death of the parent who goes back on their promise and bequeaths the farm to another sibling or third party.
Once a finding of proprietary estoppel has been made, the court has a wide discretion as to remedy. The court may make an order giving effect to the claimant’s expectation or it could compensate the claimant for the detriment that they have been found to have suffered. The breadth of the court’s discretion can make it difficult when advising clients and this is complicated yet further by the fact a claim based on proprietary estoppel is often combined with a claim under the Inheritance (Provision for Family and Dependants) Act 1975 (which enables certain categories of people who were financially dependent on the deceased prior to death to bring a claim for reasonable financial provision from his or her estate) or indeed a constructive trust claim.
The most likely reasons for the rising prevalence of these types of claims in the context of family farms (aside from the increased press coverage raising awareness of the possibility of making such a claim) is the ageing population and significant increase in value of farm land as well as the possibility of old fashioned views concerning gender (i.e. a son falls first in line to inherit).
Seeking to guard against any such claim in the first place should of course be the priority and to this end the following considerations should be borne in mind:
Making a Will should be prioritised: the owner of the farm should clearly document his or her testamentary wishes for the farm and it is advisable that this be supported by a letter of wishes setting out the reasons why he or she has chosen to benefit a particular person or persons (and similarly the rationale for excluding a particular person or persons);
Communication is key: owners should be encouraged to discuss success planning and their intentions with their close family (and other applicable parties) and discouraged from making promises that they have no intention of keeping;
The importance of contemporaneous written evidence: these types of claims are fact sensitive and any court is likely to place significant emphasis on contemporaneous written evidence of things said and decisions made (and the reasons for them).
Whilst adhering to the above provides no guarantee that a claim will not be bought, the prospects of success of any such claim are likely to be significantly diminished by doing so (and consequently another party pursuing a claim to trial less likely).