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GAZETTE
JULY-AUGUST
1
FARMING AND FINANCE
Paper read to the Law Society Annual Conference
by
W. A. Osborne, Solicitor
One of the crucial elements in relation to farming and
finance is the full usage of all available land, its transfer
within the family and its devolution from generation to
generation, all of which are complex matters.
The preface to the 3rd Edition of Cherry's Irish Land
Law published in 1902, comments that in the ten years
which had elapsed since the 2nd Edition was published in
1892, seven new Acts of Parliament had been passed
dealing with Land Law and the then new 3rd Edition
contained reference to approximately 800 new cases
decided in that ten year period, bringing the total number
of reported cases referred to in the 3rd Edition to more
than 2,000.
Nonetheless, there are many uninformed people who
say that the ownership of land, its usage, sale, disposal
and devolution should be a simple matter to arrange
legally; indeed as simple as the transfer of ownership of a
car. That is, as we know, not so.
"THE LAND ACTS"
The introduction of the Land Acts towards the end of
the 19th Century provided machinery whereby a tenant
occupier could acquire the freehold ownership in the farm
so occupied. To a large degree this legislation defused the
land agitation, which had existed continuously over many
years and which had bedevilled farming. But with that
right of freehold ownership came a feeling of
possessiveness in relation to land, which in turn has
created problems in its user, its devolution and
availability. The possessiveness to which I have referred is
understandable, in that for generations, a land war was
fought with the tenant occupier, under a Landlord and
Tenant system, coming off second best and hence, once
the freehold ownership was achieved by a tenant, he
became dogged in his determination to retain ownership
and that determination not to part with ownership is
reflected in the attitude of many farmers who are reluctant
even to consider a transfer, or sharing of ownership with
their own family, or to retire, having reached an age at
which one is incapable of farming fully. It is for that
reason I believe that the E.E.C. and Land Commission
farm retiral schemes, designed for older farmers, have not
succeeded.
TAXATION AND THE PRACTITIONER
Allied to this reluctance are the problems created by
Inheritance Tax and Gift Tax and to a lesser degree, but
equally important, by the family legal rights created by
the Succession Act of 1965. Hence we have a
combination of social and legal problems.
A substantial part of our work as Solicitors,
particularly country practitioners, but not by any means
exclusively so, is concerned with family advice in relation
to the family farm, its usage, transfer and devolution. It is
not part of my brief to deal in detail with taxation
problems, but having overcome the basic reluctance to
transfer or change ownership within a family, any
intended transfer of ownership or of part ownership, or of
part of the farm must then be very fully considered and
discussed in all its aspects, to include taxation. It is
helpful to bring as many members of the family as
possible into all such discussions, so that all concerned
will fully appreciate the tax implications, the difficulties
confronting the parent who wishes to make a transfer to
one of the family, namely the uncertainty as to whether
that person is capable of taking on the responsibility of
providing adequately for the remainder of the family,
including particularly the parents, or whether that person
will indeed be willing or inclined to do so. The
uncertainties as to whether the member of the family will
marry and should he or she do so, will ownership, should
that member of the family die in the parent's lifetime, pass
the property on to his spouse and will he or she be able to
provide adequately for the parents and family,
particularly if the spouse has a family of his or her own to
provide for; or will she be forced in such circumstances to
dispose of the property and if so, where will the parents
and the remainder of the family stand. On the other side
of the picture is the farming son or daughter who has
remained at home, contributing full time to the farm and
its working and receiving in return keep and maintenance
and small sums by way of pocket money and who is
understandably eager for and perhaps insistent that his or
her future be provided for, by means of a transfer of
ownership of the farm, or of part of the farm and perhaps
also insistent on having a greater say in the running and
operation of the enterprise. When confronted with these
uncertainties and dilemmas, more often than not, any
thought of an immediate transfer is postponed and the
frustration of the farming son or daughter grows,
resulting in a very unhappy relationship, which can,
despite even a great measure of understanding and
goodwill, most certainly in time lead to a rift in the family,
which will be difficult, if not impossible to heal in the
future.
UTILISATION OF FARMLAND
Apart from the problems associated with the family
farm, it is now generally acknowledged that there is a vast
under-utilization of farm land. Despite the fact that it
plays a vital role in the economy and is one of, if not
indeed our prime source of wealth. This state of affairs
usually occurrs by reason of circumstances outside the
immediate control of the land owner and is probably by
reason of family circumstances, or lack of capital or
equipment, but more often than not, it will arise by virtue
of old age, illness, or other incapacity, the unavailability
of assistance on the farm, there being no child or other
near relative to inherit or assist in the full working of the
land, or small holdings which are incapable of being
farmed economically, or which are unable to provide for
the owner the basic necessities of life and necessitate part-
time off farm employment.
There is a general belief that farmers individually are
owners of large tracts of very valuable land. The current
urban belief that all farmers are possessed of wealth
which is capable of providing substantial income
permitting them to live like semi-millionaires, is so far
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