Agricultural Solicitors

Agricultural law can be very specific, and it therefore needs specialist knowledge when it comes to dealing with issues of ownership and how the land may be used. It is very important for farmers to get to grips with the ways in which this can affect them, as it can have huge impacts for their businesses in terms of how they run and what their future might look like.

Lovedays Solicitors have been working in the field of agricultural law and have built up a reputation for our extensive knowledge and understanding. We can help you to understand the laws that impact on you, and navigate your way through the sale of land, tenancies, development and even succession planning to ensure that you get the best options for yourself and your family.

Understanding Agricultural Land Ownership

Agricultural land means bare land that is used for agriculture, and who owns that land can be very important in what happens to it. In 2023, 6.2 million hectares of agricultural land were owned, and 2.9 million hectares were rented, so it is a huge sector to understand.

Agricultural land can be owned by joint tenants who have equal ownership, or tenants in common who hold their own share in the land and can leave it to anyone that they choose.

There is also an option known as Beneficial Interest which is separate from the legal ownership and takes the form of a discretionary trust which sits behind the land. The legal owner will then hold the beneficial interest in the land on trust for the beneficial owner who has the right to the income from the land or a share in it as well as the right to a portion of the proceeds of the sale.

The local authorities are a significant agricultural landowner in the UK, with around 1.30 acres of land across England owned by them, and 44 councils own vast ‘county farms’ which can help to support the economic viability of local farming.

Whatever type of ownership structure you have, it is important to make sure that it is recorded in a formal written agreement. This helps everyone involved to know where they stand and can make it much easier when selling or renting the land or applying for a loan. This written agreement can also be used to help resolve disputes, establish succession planning or be used to clarify legal matters in the event of your death. 

Common Legal Issues in Agricultural Land Use

How land is used in the UK is subject to some very strict laws. As large amounts of farmland have been sold off to property developers in recent years, restrictions have been put in place to ensure that the agricultural land of the UK does not disappear entirely.

Zoning laws are local regulations that state how land can be used. They are established by local governments and categorise land into different zones which each have their own permitted uses and restrictions. There are specific agricultural sections within this which aim to preserve land for farming and other related activities, and any desire to change this will require a public review process.

It is important to understand how land use laws will affect your land, particularly if you want to change what you are doing. You may be required to keep a certain proportion of your land for agriculture, or you may apply for grants or licences depending on what you do. If you lease the land to a tenant, you must make any land use restrictions clear as part of the deal and the contract, to help minimise any conflicts or disputes arising in the future.

Leasing and Tenancy Agreements

When leasing land to a tenant, it is important to put a Farm Business Tenancy Agreement in place. This ensures that at least a part of the land in question is used for the purposes of agriculture throughout the tenancy.

This kind of agreement also looks at the rights of the tenant and will cover what they can and can’t do on the land and should highlight any restrictions that might apply to them. It should also make them aware of any covenants, planning issues or rights of way that could affect how they wish to run their farming business.

A Farm Business Tenancy Agreement also sets out the term for the lease, and how much notice to quit should be provided. This is normally a minimum of 12 months depending on whether the lease is short or long term. It should also contain clear details on the rent, when it is due to be paid and how often a rent review will take place to ensure that it keeps up with current market rates.

The Agreement should also detail any compensation to be paid to tenants for the physical on intangible improvements that they may have made to the land during their tenancy that the landlord will then be able to benefit from.

Farm Business Tenancies: Agricultural Tenancies Explained

Changing Land Use and Diversification

There will be times when it will be necessary to change the use of agricultural land in order to sell it or diversify, but there are a lot of processes to go through in order to get on top of the local planning laws. It is necessary to make a formal application for a change of use to the local authority, outlining what land will be used for and any benefits of doing so.

Land often does not achieve its full value without planning permission in place and so some landowners opt for an overage agreement, which commits the buyer to paying more for the land if they are able to achieve the planning permission that they want within a particular timescale.

Alternatively, conditional contracts will bind the buyer to going through with the purchase once the agreed conditions, such as obtaining planning permission, have been reached. Promotion agreements are another common solution, as this uses an experienced promoter to obtain the planning permission and achieve a sale for the land. They are only paid and reimbursed if they are successful in the process.

Changing the use of agricultural land can be tricky, and it is important to be aware of how this will impact on any other agreements that you might already have in place.

Check out our Land Development Services

Succession Planning and Inheritance

As farms are often family businesses, succession planning can be very important. Often, partnerships are taken on trust, but this can make things very difficult if one partner leaves or dies. It is therefore important to put a Farming Partnership Agreement in place that can not only help to protect the individual parties, but the future of the business for generations to come.

The details of an agreement can state what will happen to one partner’s shares and income, which can mean passing it on to a family member. This will override anything that is put in a Will, which means no-one can give away more than they are entitled to.

As Inheritance Tax is paid on death for the assets of what is left in an estate, it is important to plan as much as possible in advance to ensure that family members are not left with a hefty bill. A Farming Partnership ensures that there is a transfer of shares not property, meaning that there will be very little tax to pay.

Agricultural Property Relief can also provide anything from 50% to 100% relief from Inheritance Tax on the agricultural value of property that is owned and continuously occupied by the owner for at least two years for agricultural purposes.

This all makes it incredibly important to ensure that formal agreements are put in place for the benefit of the business and those who are next in line.

Get Help Drafting Farming Partnership Agreements

Navigating Government Programs and Subsidies

The agricultural industry has been struggling for many years, and so a number of government programs and subsidies have been put in place to help support farmers as much as possible.

There is funding available for veterinary care of livestock and grants to allow the refurbishment and replacement of hen and cattle housing. There are also grants for improving productivity, animal health and welfare, slurry management, waste management and research and development projects.

There are also subsidies available for producing food that is in demand and to replace previous EU backed subsidy schemes.

To apply for any of these, you will need to reach certain eligibility criteria. As these are often based on the size of the farm and the production levels, it is important to be able to produce all formal agreements and contracts as evidence. If you receive a grant or subsidy, you must pay close attention to the terms, as these can be withdrawn if you do not maintain compliance throughout the period of the grant.

Buying and Selling of Agricultural Land

When buying or selling agricultural land, there are a lot of legal considerations that need to be taken into account. It is important for all parties to understand the land in question, looking at its terrain and condition as well as what it is currently used for.

There needs to be a period of due diligence before any property sale to make sure that the ownership of the land is clear, as well as its approved uses. There will need to be a number of searches conducted to find out whether the land has any planning permission, rights of way or restrictions that could impact on how the land can be used as well as its overall value.

There can be cables or pylons on the land, as well as environmental restrictions relating to water sources, fertiliser, waste or even noise, that could all affect the plans for the land. If the land falls into a protected area such as a National Park or Area of Outstanding Natural Beauty then it may have further restrictions, or there could be special wildlife habitats that prevent the development of the land.

It is important that thorough research is done before any land is bought or sold to ensure it is legal and that the value is fair and representative.

Check out our Buying and Selling Agricultural Land Services

Title Matters and Profits à Prendre

When land is owned, it is given one of a number of titles governed by the Land Registration Act 2002. A Possessory Title means that you are the owner of the property, but HM Land Registry is missing some information and cannot legally certify the title in the normal way, giving a previous owner or interested party the right to dispute your ownership.

In contrast, title absolute means that you are able to legally prove that you own the land without any chance of it being disputed.

There are a number of rights relating to the ownership of land that may not be well known but are still very important. Profits à Prendre is a right to enter and take something from another person’s land. It must be something that is capable of being owned, such as soil, grass, timber, fish or wildfowl, but it cannot be water unless it is in some form of container.

A Profit à Prendre can be created through an agreement with the owner of the land and the recipient or through a long period of use. This right is something that can be registered and can be very important to protect landowners who are adjacent to one another and are working together in an amicable relationship.

Check out our Profits à Prendre Services

Lovedays Solicitors: Your Partner in Agricultural Law

Lovedays Solicitors are Derbyshire based experts in the world of agricultural law. We have many years of experience in helping farmers and landowners to navigate this complex legal landscape to help get them the best for their business. This means protecting their rights, understanding restrictions and guiding them through land sales and tenancies.

We have a professional and friendly team who treat every single one of our clients with fairness and we pride ourselves on our transparent processes. We are specialists in agricultural law and agricultural property, ensuring that we are in the best position to help, advise and guide you.

We understand that every situation is different, and so each person who contacts us will receive a bespoke and personalised service that is designed to meet their own specific needs.

Conclusion

The legal side of agriculture can be an extremely complex one. Not only is it necessary to wade through the issues of land ownership and tenancies, it is also important to think about how your land is used, who can use it and what restrictions there are on it. There is also a massive human element to agriculture which means that you don’t just think about who you want to work with now, but also who will be following in your footsteps.

All of this needs some very careful planning and should be written into formal legal agreements to prevent misunderstandings, conflicts and disputes further down the line.

At Lovedays Solicitors, our expert knowledge means that we are in the perfect place to do this for you, and to help ensure that you, your land and your family are protected for many years to come.