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When farming partners split
By Dr. Donald J. Jonovic
THE PROBLEM: How can
years of undefined land transactions be straightened out when partners decide
to split? ~Submitted by U.F. via email
My dad and older brother originally farmed together. When Dad
retired, I took over his interest in the farm.
Some time later, our uncle came to me and wanted me to farm
his 300 acres. Thinking that my brother and I farmed together, I told my
brother, and we farmed that land together.
Another property was offered to my brother, and again,
thinking we farmed together, I got set to do it with this land also, but I was
told that "maybe we farm some ground together, but we do not ‘farm'
together." He told me he would farm this new land by himself.
We continued farming the same as always, going over all of
the ground together, until several years had gone by, and I was told that I was
not doing enough. My brother took the land he brought, and I was given what Dad
brought to what they farmed together. This split was engineered by my brother
alone. I was not consulted.
We kept farming my uncle's farm and purchasing property
together for a while, but we've now decided to split totally. The land we bought
together came to us through my brother, so he is taking the better-quality land
in exchange for him bringing the land. My uncle's farm is under protest. My
brother thinks he should get half of that farm, even though I brought it to us.
I say that our uncle's property should go to me. My brother
says I am greedy and will see to it that I'll lose other property I farm if I
don't let him have half. Am I wrong to feel used?
Dr. Jonovic's solution
The situation of U.F. and his brother is tangled and knotted
up by years of unshared assumptions, unrecorded decisions, lack of written
agreements, and positions based on opinions supported by facts that are totally
in dispute. Add to that an older brother's unilateral assumption of power and
superiority, and we could all agree that U.F. is in a very bad place.
Over the years, I have repeated in many ways and forms the
same basic fact of business life: If an agreement isn't in writing, it
effectively doesn't exist.
Verbal or assumed understandings usually are little more
than conflicting opinions held by people in training for inevitable all-out
war. So now that the bullets are flying, U.F. has only three options as far as
I can see.
- He can sit down with his brother and slog through a messy
process of negotiation, for which neither is prepared nor experienced.
- He can take the undefined mess into court, but the only
likely winners in that situation are lawyers.
- He can remain consistent with his past behavior and roll
over, accepting whatever his brother thinks is just and fair.
None of these options is attractive or likely to result in a
positive outcome from U.F.'s point of view. We can all commiserate, but it is a
position he allowed himself to get trapped in, as he trusted but never
Still, his experience can benefit others. Every one of us
should dedicate quality time examining our own business relationships. What
ownership structures have we failed to define? What important agreements aren't
in writing? What critical assumptions have not been tested by open discussion?
U.F. will have to settle for less than he wants. It may be
too late for him to achieve an optimal result, but it doesn't have to be for
the rest of us.