Family Farm Accountings

One of the benefits of practicing family law in Brandon is that we get to work on complicated farm cases. 

When a couple separate and there is a family farm involved, matters can get complex but never dull. 

For example, in a typical case we have to look at the following:

1. Farm land ownership. 

Some couples will own land jointly, and some couples will have land owned by only one spouse. Sometimes the land was gifted by one (or both) sets of parents, sometimes it was purchased from the older generation. Sometimes it was inherited. In each scenario, the legal implications are completely different.

2. Livestock. 

It is extremely difficult to look back in time to the exact date of separation and figure out how many cows or pigs were on the farm. As well, what did each one weigh? The price is determined by weight. Were they pure bred? In good health? Dairy vs. beef? Were there newborn calves present at the date of separation? What is the cost to ship and sell each cow? These questions can be hard to answer.

3. Grain inventory. 

A farm can have many types of grains and hay and straw and corn and barley and flax and canola; not just the harvested crop but also in seed form. Depending upon the time of year a couple separate, a Judge may have to look at the standing crop, a newly harvested inventory, a partially sold inventory, accounts receivable or perhaps just next year's pre-purchased supplies. It can be difficult to determine how much grain was on the farm at any point in time, let alone the condition of it and therefore the going sale price at that time.

4. Machinery and equipment. 

Normally an auctioneer can attend at the farm and put a fair market value on each piece of machinery and inventory. Sometimes there is a dispute over whether the combine or manure spreader is owned by the farmer's parents, or gifted by them, leased or borrowed from the neighbour. Often there will also be tax implications on the sale price.

5. Bins. 

Typically if grain bins are fixed to the land, they form part of the price of the land. If they are moveable, they have a separate value of their own. Also, many bins are leased. This means that they could either be considered an asset and a debt, or left out all together as an asset not owned by the farmer.

The farm's accountant is a crucial part of the team as we work through a separation involving a farm.

The best advice we as lawyers can give is to gather evidence as close to the date of separation as possible. Properly documenting the farm assets at the date of separation with pictures and videos
is absolutely crucial to a timely and less expensive resolution to the case.