Julie Annette Merryman v Alex Raymond Merryman
| Jurisdiction | England & Wales |
| Judge | Baddeley |
| Judgment Date | 14 March 2024 |
| Neutral Citation | [2024] EWFC 58 |
| Court | Family Court |
| Docket Number | Case No: ZZ21D18441 |
and
[2024] EWFC 58
HHJ Baddeley
Case No: ZZ21D18441
IN THE FAMILY COURT AT SHEFFIELD
50 West Bar
Sheffield
S3 8PH
Mr Campbell (instructed by Acclaimed Family Law) for the Applicant
Mr Khub of Zakery Khub Solicitors for the Respondent
Mr Dable (instructed by Wildblood Legal Limited) for the Intervenors
Hearing dates: 7 th & 8 th February 2024 and 14th March 2024
Approved Judgment
This judgment was handed down remotely at 2pm on 14 th March 2024 by circulation to the parties or their representatives by e-mail and by release to the National Archives.
HHJ Baddeley
Introduction
This judgment deals with the intervenors' application in financial remedy proceedings between their father, Alexander Raymond Merryman (65), and stepmother, Julie Annette Merryman (59).
The intervenors are Elizabeth Lawson (34), Katie Ann Merryman (32), Scott Merryman (31) and Robert Merryman (28).
Because all but one of the parties have the surname “Merryman”, I shall use first names in this judgment.
The application concerns four properties, which I shall refer to in this judgment as:
i) Border View Farm
ii) Heavygate Road
iii) Dunston Farm
iv) Smugglers
The intervenors' case is that they are each entitled to a one-sixth share in each of the four properties by virtue of them being partnership property or alternatively by reason of the doctrine of proprietary estoppel.
Alex supports the intervenors' claim.
Julie accepts that the intervenors are equal one-sixth partners in the farming business, AR Merryman and Family. Her pleaded case was that they had no interest in any of the properties, although she accepted in evidence that she considered that the intervenors each had a one-sixth interest in all the land at Border View Farm except for the farmhouse, on the basis that the land at Border View Farm (but not the farmhouse) was an integral part of the farm business.
Chronology
– Alexander and Julie begin cohabiting. They both worked in partnership at Border View Farm, which had been rented by Alex's father. There was no written partnership agreement.
– Julie bought Border View Farm. Alex was not initially a joint owner as he had been bankrupt.
– Alex and Julie jointly bought a buy to let property at Heavygate Road, Sheffield, subject to an interest only mortgage with Kensington Mortgages.
– Alex and Julie married.
– Border View Farm was transferred into Alex and Julie's joint names.
– Alex and Julie entered into a charge over Border View Farm with Clydesdale Bank.
– Dunston Farm was purchased in Alex and Julie's joint names subject to a Clydesdale Bank charge.
— All six parties to this application, save for Robert (who was not then 18), entered into an agricultural charge with Clydesdale Bank over Border View Farm, Dunston Farm (but not Heavygate Road) and the assets of the farm to secure significant borrowings. It appears to be common ground that Robert was subsequently added as a party to this charge, although a letter from the bank to Alex's solicitors on 16th January 2020 indicates that Robert had not been joined as a party to the charge at that time. The borrowings at the time were in the region of £1 million.
– Alex instructed his solicitors to draw up a partnership agreement. There is a solicitor's file note which reads “Partnership agreement with children (not asset partners). Bank wants this… After completion Alex would like to make them partners in assets as well… [solicitor] to draft & send to bank manager.”
– on 26th February 2020, all 6 parties to this application signed a partnership agreement.
– Alex and Julie separated in the Spring. Julie's solicitors wrote on 1st July 2021 to the farm accountant, Sally Wood, asking for financial details, together with the last 2 years accounts and tax returns. Sally Wood replied stating that Alex runs the farm / business as a sole trader and that he did not wish to release the accounts. This was not true.
Smugglers, Roman Bank, Sandilands, Mablethorpe was purchased in Alex's sole name on 22nd July 2021 for £148,000. Julie currently lives at Smugglers.
Agreed Issues
There is common ground in respect of the following:
i) All 6 parties to this application are equal partners in the farming business. This was confirmed in the partnership deed dated 26th February 2020.
ii) Alex and Julie devoted their working life to the development of the business, up until Julie's departure from Border View Farm at separation in 2021.
iii) Each of the intervenors has devoted their working life to the development of the business from the time they each left agricultural college or university.
iv) None of the parties has taken a salary at any point, with the business funding their day to day needs and anything left over being reinvested in the business. The 2022 accounts do include modest drawings, but it is unclear how these have been accounted for.
v) The business had only one bank account. All the transactions relating to the farm and the properties went through that account.
vi) Border View Farm is now a much bigger enterprise than it was, with a 4-bedroom bungalow having been built in 2001, a farm shop in 2007, and a café in 2019. A log cabin was purchased and an indoor space for a riding school created in 2016.
The Hearing
I heard the case over two days on 7th – 8th February 2024.
The Intervenors were represented by Mr Dable. Julie instructed Mr Campbell and Alex instructed Mr Khub.
As anticipated by DJ Roebuck when listing the hearing, there was no time within the two days to deal with submissions and judgment. Accordingly, it was agreed that the advocates would make their submissions in writing (with a right of reply) and I would give this written judgment.
I heard evidence from all six parties to the application.
I have considered the papers in the bundle, Mr Dable's skeleton argument, the detailed written submissions of the advocates and the responses of Mr Campbell and Mr Dable to the other advocates' submissions.
The Evidence
The Intervenors
Scott
Scott was the lead witness for the intervenors. He has worked full time on the farm since leaving Askham Bryan Agricultural College. The business has a contract to provide gritting services to Amey and he undertakes that work as well as general farm work.
Scott lives at Dunston Farm. He does not pay rent.
His evidence was that it was always understood that the farm would be passed onto the children when the time was right, and it was talked about often. He said in his statement that “it was the natural assumption of everybody that we children would take over the farm business when the applicant and the respondent were at an age where they would be slowing down… [we] were led to believe that all of the properties that the family/farm business owned, were owned by the Partnership and all of us equally.”
In evidence, he said, “we were all led to believe that all the properties were or would become part of the partnership business and we would all get a share” and that both Alex and Julie said this during a series of conversations over the years.
He said that his getting a share in the property at Border View Farm was often discussed over the years. Scott was clear that Julie had promised him a share in Border View Farm from an early age.
There were discussions whereby he was promised a share in Dunston Farm and Heavygate Road but less often. He could not give a specific occasion when Julie made a promise in respect of Dunston Farm but that she said this on “numerous occasions”. He was less clear, when asked about Heavygate Road – “I believe [Julie] made a promise re Heavygate Road – I'm confident but we are talking over 15–20 years [ago].”
As to Smugglers, he said “probably not so much – we weren't going to have a share in it as it was bought for [Julie] to live in and she was living there.”
Scott was unable to recount any specific discussions – he said that there was a series of conversations involving both Alex and Julie over the years.
Scott said that when he signed the agricultural charge in 2013 “they sat us down and said we were liable for this debt. They said at that point that we were partners in the property and the business.”
He said that it would make no sense to make him liable for £1 million debt and for Alex and Julie to say that they would keep the properties and he could pay the mortgage and take on all the debt. He wouldn't have signed the charge without an expectation of receiving a share in the properties. He would have taken a job with a view to setting up his own farm elsewhere. He said, “why would I go out looking for something else when I was promised a share of the farm and the buildings.”
Scott saw that the properties were an integral part of the business saying that “you can't be much of a farmer without a farm.”
Scott said that he had done some works on Dunston Farm, with materials paid for by his wife – installing a second-hand kitchen and replacing the bathroom. He has also done odd jobs at Heavygate Road over the years, fixing leaks, a bit of tiling, general DIY upkeep jobs.
Scott said that he read the partnership agreement before signing it but did not understand it all at the time. His understanding was that all the properties were held by the partnership.
Elizabeth
Elizabeth lives with her husband and their children on her husband's family farm in the Mayfield Valley. She has worked full time at Border View Farm since leaving college. Her responsibility is the sheep and the farm paperwork. She can combine this work with her childcare responsibilities.
Elizabeth's evidence...
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