Whether you have a legal, tax, insurance, management or land issue, Farmers Weekly’s Business Clinic experts can help.
Jonathan Thompson, a senior associate at law firm Thrings, sets out how a dispute over what to do with shared land might be brought to a conclusion.
Q. I am a part owner of land over which there is disagreement with partners in the land as to what to do with it.
I am keen to sell. How can I get the other partners to put the land up for sale?
A. Property ownership is difficult when divisions of interests occur. A court application can resolve issues.
First, consider the practical background and everyday use of the land. While the law assists in one way, there are other possible remedies.
Land can be owned in different ways. It’s important to distinguish whether you:
- own the land between you as people named on the Land Registry title (or unregistered title deeds);
- are not a joint legal owner but have a beneficial interest in the property;
- are one of the owners on the legal title but others have a beneficial interest; or
- are a partner in a business where the partners are either allowed to use the land by one of the partners who owns the land or have been granted a tenancy by that partner.
If you are a partner in a business that is permitted to use the land by the owners (who might also be partners) or has been granted a tenancy, you may have no say as to that decision to sell.
If the partner who owns it decides to sell, legally he or she can do so. That might lead to a partnership dispute, but that is a separate Business Clinic question.
However, there are options here that are explained below.
Legal remedies: a pragmatic commercial response is “can the disagreement be settled by mediation?”.
That is done by a qualified mediator, accredited by organisations such as the Agricultural Law Association.
A mediator may help both parties find a pragmatic solution, mindful of the law but also the background situation and any commercial or relationship issues.
Focusing on legal issues, the Trusts of Land and Appointment of Trustees Act 1996 (TLATA) was introduced to modernise how land is owned and provide a mechanism to resolve legal disputes between co-owners.
Under TLATA, you could make an application to court for an order on a number of questions. These could be:
- whether the property should be sold;
- what shares people have in a property as co-owners and/or co-occupants; and
- where an individual is not on the legal title, whether that individual has an interest in the property (which will have a value). This might include a partnership situation.
These questions can lead to an order that a property is held under a trust of land and should be sold or split up. However, a court cannot make a person with an interest sell to another.
The court will consider why the trust of land was created and the wishes of all those with an interest in it. If the land includes a farmhouse with a young family in it, that is a further factor.
The case of Bagum v Hafiz and Hai (2015) provided that a beneficiary can be given an opportunity to purchase the property from another person, with a beneficial interest at a value set by the court.
Finally, the commercial relationships between farm business partners and landowners can be relevant.
The case of the Estate of RJ Kingsley v Kingsley (2020) provided for the sale of a farm to the surviving business partner, where the deceased brother and his still-living sister (who were the business partners) had owned the farm equally.
In this case, the land was not a partnership asset and the partnership was allowed to use the land – the key point being that the same people can own the land but their commercial partnership is a different commercial being (ie, the same people could be landlord and tenant but in different capacities).
In summary, you can address the issue by mediation or a TLATA application potentially. Mediation will be quicker and less costly.
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