Lanyon Bowdler: Full-Service Law Firm Shropshire, Herefordshire & North Wales

Scarcely a week goes by when a solicitor has clients unaffected by the impact on the courts and public services regarding cuts and COVID-19. Sir Andrew McFarlane, President of the Family Division, commented back in March that the family law courts and associated bodies were working at the limit of their capacity. His concerns were reiterated and emphasized on 24 July when the President urged separating families to resolve their disputes elsewhere, rather than through the courts.

This is something family law solicitors largely strive for and have done so long before the present public health and economic situation, but we can only work within the boundaries presented by our clients who, in turn, are often affected by social and economic factors that further limit their choices.

These constraints could be said to fall under two headings, although they are by no means mutually exclusive:

Social Factors

• There was a time not so long ago when (for example in North Shropshire) funding was available for specialist domestic abuse workers to go into schools and work with even the youngest children, in an age-appropriate way, to develop an understanding of healthy, respectful relationships. That funding has disappeared.

• It remains apparent that girls and young women remain prone to messaging and factors that foster a sense of being undervalued – such as period poverty, revenge porn and body-shaming – which go on to affect how they participate in relationships.

• Despite the great work being done by many organisations to de-stigmatise mental health issues in young men, the “big boys don’t cry” message impacts negatively on how some men may feel about expressing their emotions in a healthy way when relationship issues arise.

Financial Factors

• Under-funded agencies are simply not able to offer the interventions needed for families having difficulties, in a timely fashion or at all. The President himself recently compared family law cases to bread dough which continues to grow and feed upon itself, even when it is left on the shelf to prove. When a case is ongoing and itself subject to delays there can be further difficulties in accessing assistance from other agencies, relatively minor issues at the outset of a case can become explosive. One example of this is the withdrawal of the Domestic Abuse Perpetrator Programme, which was previously available at no cost, if ordered by the court.

• Private providers such as counsellors and therapists exist but, with the best will in the world, they are simply not accessible to many families, financially or geographically, especially in rural areas where financial poverty is compounded by poverty of basic services, lack of public transport, etc.

• Legal aid is still available for family law cases where a person qualifies financially and can prove the existence of domestic abuse. The emphasis on proving domestic abuse can shift the focus unhealthily so that behaviours which, whilst unacceptable, were not “deal-breakers”, must necessarily be pushed to the forefront and assume a level of importance that detracts from other issues within the case. Having qualified for legal aid the person is then under financial pressure from the Legal Aid Agency to bring the case to court, or risk running out of funding.

• Mediation can be carried out under legal aid without needing to prove domestic abuse, and there is also some government funding available for mediation on children issues where a person cannot access legal aid. However, a mediated agreement may still need to be put before the court for approval, and will go through the same process as contested cases at the outset, adding to the backlog.

• Where resources are tight, and the other party in a case is not able (perhaps for one of the social factors set out above) to engage constructively in negotiations, then the solicitor may feel that an application to court is the only way of achieving some sort of timetable and “end-date” enabling the client to have a broad indication of what the case might cost.

It is worth mentioning ADR (Alternative Dispute Resolution) at this stage which, whilst not an outright solution to the financial issues, since it must still be paid for, can give people a good deal more certainty and control over the situation than they might have through the courts. However, since it is largely voluntary it still relies on a degree of goodwill and cooperation from both parties.

The President’s observation is entirely correct and a reduction in the number of matters coming before the court is something we need to aspire to. However, the court service is merely a cog in a large wheel designed to move society forward, and unless there is concerted and joined-up Governmental effort to tighten the other cogs (through availability of vital services and a cultural shift starting with very young people), then the wheel will simply fall off altogether.

Working in the Court of Protection department I regularly interact with clients who lack capacity to manage their property and affairs, or other aspects of their daily life. Some of our clients may have sustained traumatic brain injuries due to personal injury or medical negligence, or they may have a disease which affects their brain, such as a type of dementia. As with everything in life, there isn’t a one size suits all approach that you can take when supporting people, so I decided to attend a Dementia Friends Webinar to ensure I can tailor my approach in the most appropriate way.

Dementia Friends offer free online, or in person, sessions to educate people about dementia. They have short pre-recorded videos you can watch immediately, or you can sign up to attend a virtual or in person webinar run by a Dementia Champion. Due to living in Shropshire I chose to sign up to a virtual session which lasted around one hour. If you would like to attend a session, and I would highly recommend this to everyone, you can do so here.

Dementia is an umbrella term and covers diseases such as Alzheimer’s disease, Lewy body dementia, vascular dementia and frontotemporal dementia. The Alzheimer’s Society published in December 2021 that there were 900,000 people living with dementia in the UK with this figure forecast to rise substantially over the next 20 years.

Whilst living with dementia is not without its challenges, there are many negative connotations strongly linked with the diagnosis. Although dementia is degenerative it is easy to forget that there is more to a person than dementia. The Dementia Friends session was very much focused on addressing and changing the stigma associated with dementia.

As with anything in life it is easy to get trapped focusing on the negatives, but there are things we can do as individuals to help change the stigma. Of course this will vary depending on the situation and the individual, but multiple small changes can make a large difference.

Understanding

Dementia doesn’t solely affect someone’s memory, it can affect their motor skills such as being unable to use a knife and fork when eating. Someone living with dementia may have difficulty with sequencing and struggle with tasks such as getting dressed. They may have difficulty communicating or with their visual perception. Understanding how dementia affects the individual means you can learn how to assist them. For example, if you were to ask someone living with dementia if they wanted orange or blackcurrant squash to drink they may not be able to communicate with you, however, if you had a picture card with both on they may be able to understand the question and communicate which they would like. Something as simple as slowing down your pace when you talk, and simplifying sentences to someone living with dementia, could make a difference in their ability to communicate.

Change

Change doesn’t have to be big to make an impact. It may be that a setting is familiar and leaving things as they are is what’s best for a person living with dementia, however, for some a small change may make their life easier. This could be something as simple as changing the layout of the kitchen so it is easier to make a sandwich or hot drink, or the layout of a wardrobe making it easier for them to get dressed in the morning.

Awareness

This is twofold: we need to be aware that we can help even in small ways and also the need to spread awareness. There is more to a person than their dementia diagnosis whether they are in the early stages or more advanced stages. It is easy for people to see or hear of a diagnosis and make an assumption. Sadly we witness these assumptions far too frequently, but with education and raising awareness hopefully they will become less frequent.

We understand that a diagnosis of dementia doesn’t automatically mean someone lacks capacity, and if they do lack capacity regarding certain decisions it doesn’t mean they lack capacity to make any decision whatsoever. If you or a loved one have been diagnosed with a disease that affects the brain, have an acquired brain injury, or have been assessed as lacking capacity, that doesn’t mean access to legal help is no longer available. The Court of Protection department at Lanyon Bowdler specialise in mental capacity law and are happy to assist you with any enquiries.

Diversification can lead to new sources of income, and may also be an attractive business project for younger generations of farming families looking for long-term financial stability. With the number of UK residents opting for ‘staycations’ since the COVID-19 pandemic, diversification has become an increasingly desirable tool for farmers and land owners to access new means of revenue. However, diversification can have a negative impact on your inheritance tax (IHT) position and could exclude the availability of valuable IHT reliefs. Before making any changes, it’s important to consider what tax implications might lead from diversification, to ensure your family doesn’t end up with a large and unwanted tax bill in the future.

Agricultural Property Relief (APR)

Many farms benefit from Agricultural Property Relief (APR), which can reduce, or completely wipe out, IHT on farm land and buildings. Briefly speaking, APR requires that the land or buildings must be occupied and used for agricultural purposes. This can include farmland, barns and storage buildings, farmhouses and farm cottages. When considering the availability of APR, HMRC will look at the different uses of the land or property and the way it is used and occupied.

Changing the use of such land and property from agricultural to non-agricultural use risks the asset in question no longer qualifying for APR and therefore becoming subject to IHT.

One popular method of diversification in recent years has been converting existing agricultural land or buildings into holiday lets, or camping and glamping sites. However, applying the above rules, these assets would no longer benefit from APR. Diversification by a tenant of your land away from agricultural use can also affect your eligibility for APR as the landowner.

Business Property Relief (BPR)

Some diversified assets may qualify for Business Property Relief (BPR), which can also reduce or eliminate IHT. In order to benefit from BPR, the asset, land or buildings must be used for ‘trading’ rather than ‘investment’ purposes. Therefore assets owned for the purpose of collecting rental income without much management, or any extra services, will likely be considered to be ‘investments’ and therefore less likely to qualify for BPR.

Common diversification projects on farms that are likely to be deemed ‘investment’ activities include holiday lets. If the level of additional services provided is particularly high, then HMRC can consider the business as ‘trading’ rather than ‘investment’, however, this is difficult to judge and each case must be treated on its own facts.

Is there a quick solution?

There is no ‘right’ answer when it comes to diversification. All farms and all families are different, with individuals having their own preferences and motivations, so there is no “one size fits all” approach. There are options when it comes to mitigating the potential IHT bill, such as insurance policies to cover IHT bills and making lifetime gifts, however, these are not without their own consequences and as a result no one should take such steps without speaking with a qualified advisor first. As with everything in life, the best option will depend on your individual circumstances.

If your diversified business is likely to include trading and investment activities, then it’s important to discuss the potential tax consequences with a specialist advisor, such as one of our Private Client solicitors.