Selling Agricultural and Farming Land

By Lindsey Nolan, 7th October 2020

How Goughs can help you to prepare for a smooth sale

Your farm will likely have been in your family for generations and will be seeped in family history. It is likely that many events, which will be relevant to the sale of the farm and/or parts of the farmland, will have taken place during that time.

Good preparation is key to ensuring a sale goes through as smoothly as possible. Our experienced Farming sector team can help you to cross the T’s and dot the I’s in readiness for going to market or auction, whatever your circumstances may be.

There are several important factors to consider, for example;

Is the farm registered at HM Land Registry?

If the farm is registered at HM Land Registry, it will have a Title number and the documents which prove ownership of the farm will be available on the Land registry’s online portal.

If the farm is unregistered, it means that proof of ownership is made up of title deeds and documents, often dating back many years and stored somewhere in the house for safe keeping! If the farm is subject to a mortgage or charge in favour of a Bank, it is also possible that the deeds are held there.

It is important to know where the original deeds and documents are. If your deeds are missing, this will need to be rectified by making an application to HM Land Registry to reconstitute (rebuild) the title.

What rights does the farm have and what rights is the farm subject to?

One of our experienced Property Solicitors can conduct a title review to ensure that all is in order. We will check common title issues such as;

  • Are the boundaries on the title plans matching what is on the ground? Who is responsible for maintenance of the boundaries?
  • Are all of the legal rights that are needed over neighboring land for the benefit of your farm in place, such as the right to enter onto someone else’s land to repair and maintain pipes or drains, or to cross someone else’s land to get access to some part of your farm?
  • Is your farm subject to any rights in favour of neighbouring properties such as rights for their drainage to pass through your land? This could be particularly relevant if you intend to apply for a building site on the farm.

Who is the legal owner of the farm?

It is common in farming families to see that although the adult children are now running the day to day farm business and are Partners of the Farm Partnership, they may not be on the title deeds as a legal owner. Quite often the parents (or even grandparents) remain the legal owners.

It is important to establish who the legal owner is because they will need to sign the Contract paperwork in order to sell the farm. If for example, they are an elderly  grandparent and there are questions about their capacity to be able to sign the paperwork, this will need to be resolved by making an application to the Office of Public Guardian for a Deputyship Order, and may have wider consequences for the terms of any Farm Partnership. In conjunction with our Property Solicitors, our Private client Solicitors will be able to assist with the investigation work into the legal ownership and and advise you on any subsequent next steps required.

Are there any leases or business agreements in place?

If you have leased any outbuildings on your farm or there are solar panels or wind turbines on the farm, then it is likely there will be Leases and/or Business Agreements in place that should be reviewed to check their terms, before going to market.

It is possible that you could have created a Lease to a tenant without even realising it, because the Lease does not always have to be in writing! This can occur if for example, you have rented out a barn on the farm to a horse owner and they have been using it on a week to week, month to month or year to year basis.

Our Commercial and Corporate Solicitors will be able to investigate the terms of any such arrangements for you to advise if the serving of Notices will need to be dealt with before going to market.

Does the farm have any employees who could be impacted by the sale?

If you have a herdsman who is living in one of the cottages on your farm, it is important to think about whether they are employed or self-employed. This is relevant because if they are employed by you, when the farm is sold, their employment may also have to be transferred to the new owner.

As above in respect of any tenancy agreement that may exist; you may have to consider whether you will need to serve them with notice to vacate the cottage or whether the new owner intends to buy that part of the farm subject to the tenant remaining in the cottage.

Are there any problems to look at before going to market?

There are many common enquiries that are raised on the purchase of a farm including whether the buildings have all the necessary planning permissions in place. If any of the buildings on the farm have been used in breach of planning, it might be worth investigating applying for a Certificate of lawful use so that the issue does not delay the sale.

Another common enquiry relates to septic tank drainage, especially following the introduction of new legislation introduced on 1st January 2020 which requires that all septic tanks are connected to a suitable soakaway. If your current system drains into a river, stream, canal or other form of waterway, this is no longer permitted.

Other issues which can arise include questions about what rights are in place for the benefit of other people, over the farm. Examples include sporting rights, bridleways and other public rights of way which may cross the farm.

Our team can look into these matters for you and prepare a detailed analysis to ensure that when your farm is marketed, you and your estate agent are in a position to advise buyers on all relevant information so that they are making their offer with full knowledge, reducing the risk of changing their mind if something of this nature is discovered by their Solicitor at a later stage!

The importance of a team of other professional advisors

The team at Goughs have strong business connections to local professionals such as Accountants, Financial Advisors and Bank managers, all of whom will be able to offer you important advice about your decision to sell your farm. We will work collaboratively with your chosen professional advisors to reach your end goal.

We understand the importance of visiting your farm to get a proper understanding of what you are selling, and we will travel to you to discuss your requirements and next steps.

Please email farming@goughs.co.uk to get in touch with a specialist today.

Lindsey Nolan

Associate Solicior - Residential Property

lindseynolan@goughs.co.uk 01225 715080