Dr. Val Farmer
Rural Mental Health & Family Relationships

Farm Estates: When The Law Becomes A Weapon

November 17, 2007

As parents age, the control of family farm assets lies in the hands of elderly parents who are in failing health and may also be losing their judgment on what is fair. Greed rears its ugly head and abuses start to occur. Here are some examples.

Scenario one: In the past, promises were made, some were oral agreements and others codified in wills and estate plans. One parent may die and the surviving parent becomes more and more dependent on a particular family for emotional and physical support. As age and dementia increase, fears and suspicions about finances grow and can be manipulated by self-serving children.

Often the perpetrator is an adult child with whom the father has had a long history of partnership. There is a huge sense of entitlement for having stayed the course in farming. This child gains power of attorney and has control over access to the financial documents, agreements, health care and even the visitation rights of family members.

There is manipulation behind the scenes to influence or change the estate plan involving the farming assets, especially land. The rest of the family heirs, mainly off-farm heirs, are essentially disinherited.

Efforts at communicating about financial issues with the elderly parent by the increasingly alarmed off-farm children are regarded as emotionally distressing. The parent is effectively isolated from these visits, either through logistics or protection orders.

The child in charge of the care has the legal power and the unfair estate plan to fall back on and has no incentive to negotiate with his or her siblings. This "protector" is more than willing to have the matter decided in the courts where the force of law seems to be on their side. The aggrieved siblings don’t like the damage to the family relationships but feel they have no choice but to litigate.

Scenario two: A father dies and leaves an estate plan that is grossly unfair to a farming son and daughter-in-law who have devoted their lifetimes to working alongside the parents. This can be a remarkable betrayal of trust for farming families who felt their loyalty and contribution over the years would be recognized in the estate plan.

The unfair will and estate plan could also be grossly inequitable to off-farm children who see all the assets being given to the farm family(s) who worked closely with father.

There is no accusation or suspicion of manipulation of the will but its gross unfairness damages family relationships and allows greed to germinate in the beneficiaries and resentment in the hearts of the disinherited. Again there is little incentive to mediate or negotiate something more fair if the main beneficiary isn’t inclined to do so.

Scenario three: Same as #2 above except the surviving widow is partial to one family and actively collaborates with them in changing wills and agreements that were in place before her husband died. She may not share the commitments her husband had and changes the will to suit her whims or the desires of a favored child. Her ignorance of farm finances could play a role in how decisions are made. She could be the main instigator in changing the estate plans or be a victim of manipulation by an adult child.

Again, the force of law is on the side of the greedy or willful and goes against the intent of previous longstanding agreements and understandings. There is no legal recourse and family relationships suffer.

Scenario four: A mother dies suddenly in her late 50s or early 60s. The father and very successful farmer eventually remarries. Within a few short years, he too dies suddenly and leaves no will. His second wife is entitled to 50 percent of the estate. Leaving no will is a betrayal to his biological children.

The surviving children of the first marriage knew that their father intended for them to have a much larger share of the farming assets that have built up over the years. Again, no legal recourse. The law is the law. Instead, they are beholden to the good will of the second wife who may be tempted to see these assets benefitting her children from a previous marriage.

A fair resolution. Some families have used informal mediation through family meetings to straighten things out for the aggrieved parties. I applaud such families who put their own self-interests aside and correct the injustice of a poorly handled will or estate plan.

Some situations may require an outside mediator to help facilitate communication and negotiate a fair outcome. It is a tribute to these families that they are willing to participate in a mediated process rather than permanently rupturing family bonds through litigation and side-taking. They choose not to go the route of expensive "all or nothing" civil litigation to declare winners and losers in these family disputes.

I wish more families would use mediation to solve these difficulties.

What do you know? Is financial exploitation and abuse of elderly parents a big issue? I suspect that it is. Have you personally been affected by it? Please write and give examples. I will delete any identifying information from a future column on this topic.

Attorneys, financial planners and social services providers, what suggestions or legal tools do you recommend to prevent these kinds of abuses from burgeoning as our farm and ranch communities age?

Send your observations to: The Preston Connection, Elder Financial Abuse, PO Box 1135, Orem UT 84059.