David and Angela are in their mid-80s and, thankfully, are still healthy. Conor, their eldest son, took over the farm when he was in his mid-30s, around 20 years ago. The parents handed over most of the farm to Conor at the time. They had two other children, Peter and Mary, who received some money. They had also received a good education and were happy to see Conor take over the home farm at the time.
The parents did keep 30 acres beside their house and farmyard. It was to give them a bit of security, but they always meant to hand the land over to Conor. As the years went on, this didn’t happen. Conor developed the farm and, after many tough years, finally enjoyed the benefits of good weather, low costs and improved prices this year.
His brother Peter, who lived outside Ireland, used to come home every few years. He came back this summer and stayed two weeks with his parents. However, when he went back after the summer, his parents mentioned that Peter would love to own a bit of land in Ireland.
They then went on to say that they had agreed to give him some of the land they owned. They also said that they were considering giving Mary, their daughter, some of the land. “It would only be fair,” David said to his son Conor, who was left reeling.
The land, right beside the farm yard, is strategic to his business, and he has always assumed that he would be left it. Yes, from the outside, it looked like he was doing very well – but there are still plenty of loans to be paid back.
Looking at the situation, you could take different sides.
The parents owned the land and could do what they wanted. Conor did well by getting the land when he was in his 30s.
Peter was only after money. He saw how well his brother was doing and played on his parents’ emotions. He only really wanted money – “Sure, he can buy the land off me” was a comment he made.
For Clare O’Keeffe of Succession Ireland, this was another case of having started a succession plan, but not following it properly through. The decision for David and Angela to initially keep the land for security was the right one. “However, the second half of the plan – to sign it over – was never followed through,” said Clare.
A Dair Deal for all?
The biggest danger of not following through is that laws and government policies change. The Fair Deal scheme, which was not around at the time of the initial plan, now has a major impact on decisions. It means that assets owned, such as land, can be used to pay for nursing-home bills. The way the Fair Deal scheme currently works, it actually puts Conor’s business at risk. If one or both of his parents went into a nursing home it could be chipped away at until it is all gone.
Peter and Mary had got some money at the time and also had been educated. They were happy for Conor to get the farm. Yes, you could say the wealth was not distributed equally. “You don’t have to have equality to be fair,” was Clare’s comment.
As time moves on, circumstances and opinions change. People can go through major financial stress, such as divorce or losing a business. They might not do as well in life and feel they should have got more.
On the parents’ side, it is common that, as people get older, their emotions often start to outweigh their commercial understanding. They want to please their children and try and help them. Like the prodigal son, they welcomed Peter’s return and were pleased for him, forgetting what had gone before.
So as well as starting the conversation early, it is important that a timeline is set on when actions have to be carried out. If the parents had followed through on their initial plan, the situation and possible friction in the family would not have arisen. CL
Next week: What’s in a name?
>> Teagasc succession clinics
Teagasc is holding a series of six free Transferring the Family Farm Succession and Inheritance clinics around the country in October.
Based on the successful format used in previous years, these are designed to enlighten and educate farm families about the many details involved in an effective plan for succession.
The format for the event consists of a short 30-minute presentation to give an overview of the main issues involved in a family farm transfer. This will be followed by the main part of the event, which will be the opportunity to engage one-to-one with accountants, solicitors, Citizens Advice, family mediation experts, social welfare representatives and Teagasc advisors.
You will be able to ask questions and get information on your own particular situation. Clinics will run from 10.30am to 1pm. Go to Teagasc.ie to register or contact your local Teagasc office.
Clinics dates
• 3 October: Clonmel Park Hotel, Clonmel. • 4 October: Blarney hotel and golf resort, Blarney.• 5 October: Park Hotel, Dungarvan.• 10 October: Riverside Hotel, Enniscorthy.• 11 October: Mullingar Park Hotel, Mullingar.• 12 October: Raheen Woods Hotel, Athenry.
David and Angela are in their mid-80s and, thankfully, are still healthy. Conor, their eldest son, took over the farm when he was in his mid-30s, around 20 years ago. The parents handed over most of the farm to Conor at the time. They had two other children, Peter and Mary, who received some money. They had also received a good education and were happy to see Conor take over the home farm at the time.
The parents did keep 30 acres beside their house and farmyard. It was to give them a bit of security, but they always meant to hand the land over to Conor. As the years went on, this didn’t happen. Conor developed the farm and, after many tough years, finally enjoyed the benefits of good weather, low costs and improved prices this year.
His brother Peter, who lived outside Ireland, used to come home every few years. He came back this summer and stayed two weeks with his parents. However, when he went back after the summer, his parents mentioned that Peter would love to own a bit of land in Ireland.
They then went on to say that they had agreed to give him some of the land they owned. They also said that they were considering giving Mary, their daughter, some of the land. “It would only be fair,” David said to his son Conor, who was left reeling.
The land, right beside the farm yard, is strategic to his business, and he has always assumed that he would be left it. Yes, from the outside, it looked like he was doing very well – but there are still plenty of loans to be paid back.
Looking at the situation, you could take different sides.
The parents owned the land and could do what they wanted. Conor did well by getting the land when he was in his 30s.
Peter was only after money. He saw how well his brother was doing and played on his parents’ emotions. He only really wanted money – “Sure, he can buy the land off me” was a comment he made.
For Clare O’Keeffe of Succession Ireland, this was another case of having started a succession plan, but not following it properly through. The decision for David and Angela to initially keep the land for security was the right one. “However, the second half of the plan – to sign it over – was never followed through,” said Clare.
A Dair Deal for all?
The biggest danger of not following through is that laws and government policies change. The Fair Deal scheme, which was not around at the time of the initial plan, now has a major impact on decisions. It means that assets owned, such as land, can be used to pay for nursing-home bills. The way the Fair Deal scheme currently works, it actually puts Conor’s business at risk. If one or both of his parents went into a nursing home it could be chipped away at until it is all gone.
Peter and Mary had got some money at the time and also had been educated. They were happy for Conor to get the farm. Yes, you could say the wealth was not distributed equally. “You don’t have to have equality to be fair,” was Clare’s comment.
As time moves on, circumstances and opinions change. People can go through major financial stress, such as divorce or losing a business. They might not do as well in life and feel they should have got more.
On the parents’ side, it is common that, as people get older, their emotions often start to outweigh their commercial understanding. They want to please their children and try and help them. Like the prodigal son, they welcomed Peter’s return and were pleased for him, forgetting what had gone before.
So as well as starting the conversation early, it is important that a timeline is set on when actions have to be carried out. If the parents had followed through on their initial plan, the situation and possible friction in the family would not have arisen. CL
Next week: What’s in a name?
>> Teagasc succession clinics
Teagasc is holding a series of six free Transferring the Family Farm Succession and Inheritance clinics around the country in October.
Based on the successful format used in previous years, these are designed to enlighten and educate farm families about the many details involved in an effective plan for succession.
The format for the event consists of a short 30-minute presentation to give an overview of the main issues involved in a family farm transfer. This will be followed by the main part of the event, which will be the opportunity to engage one-to-one with accountants, solicitors, Citizens Advice, family mediation experts, social welfare representatives and Teagasc advisors.
You will be able to ask questions and get information on your own particular situation. Clinics will run from 10.30am to 1pm. Go to Teagasc.ie to register or contact your local Teagasc office.
Clinics dates
• 3 October: Clonmel Park Hotel, Clonmel. • 4 October: Blarney hotel and golf resort, Blarney.• 5 October: Park Hotel, Dungarvan.• 10 October: Riverside Hotel, Enniscorthy.• 11 October: Mullingar Park Hotel, Mullingar.• 12 October: Raheen Woods Hotel, Athenry. 
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