Latest Farming Dispute Demonstrates the Importance of Written Partnership Agreements
In the latest farming dispute to emerge from the courts (Wild v Wild, 2018 EWHC 2197 Ch), a judge has ruled that a £1.65m farm and bungalow should be included in the deceased’s estate rather than part of a farming business.
The deceased, Ben Wild, died in 2003 and the farming partnership continued between the two brothers, Malcolm and Gregory Wild, until 2016 when relations broke down.
Claimant Gregory Wild believed the farm and bungalow to be a part of the farming partnership, therefore subject to the partnership’s winding-down proceedings, whereas defendants Malcolm Wild, his wife Abigail and his mother Jean argued the farm and bungalow had passed to Jean as specified in their father’s will.
Malcolm and Abigail had also invested significantly in the bungalow’s renovation, which during the case was valued at £285,000. Another point of contention was how much of the renovation’s budget had come from the farming partnership, which Gregory argued was a majority.
Accounts for the partnership and mentions of the farm and bungalow were patchy as records had been lost or never recorded, which is where the dispute arose.
This was a complex dispute that involved deciding whether the farm, and by extension the bungalow which defendants Malcolm and Abigail Wild lived in, was a part of the farming partnership or part of the deceased’s estate.
It was a good outcome for the defendants as the judge ruled the farm and bungalow were indeed belonging to their mother Jean Wild and that they had a proprietary estoppel claim against the bungalow, which has been their home for decades. However, the dispute could have been avoided had the family made sure that all assets were clearly accounted for either in a will or a formal partnership agreement decades earlier. Unspoken understandings and assumptions are a reckless foundation for a business and yet a lack of clarity in this area is unfortunately quite common.
The Wild brothers’ relationship had deteriorated significantly over the years, even coming to blows in the past as mentioned in the judgment. It is likely the stress and cost – both emotional and monetary – of the will dispute that has taken years to resolve soured relations even further.
Families that have a family business, whether they are farming or not, and have an understanding of whatever nature that it may pass to them upon the death of their parents should look into drawing up a formal agreement to avoid this situation – the more complex a structure, the lengthier and more costly the dispute could be.
The case is well worth reading – https://bit.ly/2N1RzW9