Earlier this year we acted for and won an inheritance dispute case for Lucy Habberfield, winning a settlement of over £1,000,000.
Lucy’s case is one of three to have been successfully won in court so far this year, all for farm businesses. Although there have been some high profile cases including the ‘Cowshed Cinderella’ many people are unaware of this type of law and its implications, something which Lucy Habberfield is keen to address.
The case related to the family farm, Woodrow in Somerset where Lucy worked since leaving school. She worked with her father to reintroduce a dairy herd to Woodrow and went on to develop and run the dairy business. For over 30 years Lucy worked for low wages and with few holidays. In 2007 she was joined on the farm by her partner Stuart Parker on a full-time basis and together they brought up four children while running the business.
Lucy claimed that her father had assured her that she would take over the farm when he retired. However, when he died in 2014 her father’s promises and assurances were not carried out. The High Court case, which was heard by Mr Justice Birss, related to compensation for broken promises. Lucy’s mother opposed the claim.
Phil Gregory, partner in the inheritance and trusts disputes team at Stephens Scown advised on the case. He explains: “For 30 years Lucy worked seven days a week for low wages on the family farm on the understanding that she would one day take over the farm from her father.
“After hearing evidence from over 20 witnesses, many of whom were local farmers and farm workers, the judge ruled in favour of Lucy. He found that she had kept her side of the bargain. To compensate her for the detriment that she had suffered over the years she was awarded a sum equivalent to the value of the Woodrow farmland and farm buildings.”
Lucy Habberfield said: “I worked hard on the farm for so long and following my father’s drop in health, my siblings, with the help of my mother, made it impossible to stay on the farm. To start with I didn’t know I could do anything about the situation – I think a lot of people in farming are not aware of this law and how it could help them. Once I realised there was something I could do, I knew I had to try for my children’s sake and to give them a secure future.
Lucy added: “Phil and his team at Stephens Scown were brilliant and a fantastic support over the last four and a half years. It is impossible to take your mind off a case like this and it is so exhausting, but having a team of experts to keep us going in the right direction really helped. My partner Stuart has been amazing too and I could not have done this without him. Now that the case is over I’m relieved, but I’m still finding it hard to look too far into the future. I would love to go back into farming at some point if I can – I loved working with the cows and really miss that work.”
Warning signs
For Lucy’s case and the others of its kind, the claimants were able to show that they had worked extremely long hours for low wages. Had their remuneration been competitive, it would have been harder for them to establish detriment.
It is not difficult to foresee similar circumstances arising in other businesses where families are involved and children are encouraged to become heavily involved in the business with the carrot that one day they will inherit. In those circumstances it is imperative that open and frank succession planning is adopted and expectations are carefully managed.
Does this sound familiar?
Whether you’re the next generation working for the family business or you’re the figurehead of it, it’s never too early or too late to address. We can help your business be compliant with employment laws including reviewing wages and holiday entitlement to meet legal requirements. We can facilitate family discussions on succession planning, taking into account aspirations and promises previously made, ensuring everyone gets a fair deal and preventing problems and heartaches further down the line.
James Burrows is a partner in the dispute resolution team at Stephens Scown specialising in inheritance and trust disputes. If you have any queries you would like to discuss please do contact James on 01872 265100, by email solicitors@stephens-scown.co.uk.