Transfer of family farm from father to son not done under duress
The High Court has found the transfer of a family farm from a late father to his now-deceased son was not committed under duress or undue influence.
A rescission had been sought by Sean Lynn’s son Michael Lynn, who had claimed that the transfer of the family home had been a result of duress and/or actual undue influence and/or illegal pressure and threats by Padraig.
Michael Lynn’s widow Bridget Lynn had also brought a claim, arguing that the transfer was void, and that further, the transfer should have entitled her to maintenance to be paid out of income from the land, which she has not received.
Olive O’Hara Lynn, the widow of Padraig Lynn, denied both claims, contending that she had been put under pressure to disclaim her inheritance soon after Padraig’s death, and that the only reason for the proceedings was that she had refused to do so, with the result that the property no longer remained with blood relatives of the Lynn family.
Delivering the judgment, O’Malley J noted that Sean and Bridget Lynn had met with their accountant on a number of occasions, who had discussed the tax implications of the transfer with them, and had not noted signs of distress or pressure on either Sean or Bridget.
The couple’s solicitor also have evidence that neither Sean nor Bridget appeared to have concerns about the transfer, that he had advised both to also seek independent advice, and that the couple had a “firm, clear and fixed intention of transferring their property to their son Padraig.”
However, Bridget Lynn gave evidence that she had not consented freely to the transfer, that she had been put under pressure by her husband, who in turn had been pressured by her son. She believed that if they had not transferred the land, Padraig’s marriage would have ended.
The Court also heard from Padraig’s widow, who described Padraig’s battle with depression, which eventually led to his suicide. However, she strongly disputed any suggestion that he had been aggressive or placed pressure on his parents to transfer land.
The Court noted that after Padraig’s death, Olive O’Hara Lynn was asked to transfer back the family land. Her refusal to do so had led to the current proceedings.
The Court also noted that a number of individuals had delivered hearsay evidence, concerning whether they considered Sean Lynn to have appeared to be under pressure. The Court found that such evidence was unreliable and therefore should not be taken into account.
Citing Hanbury & Martin on Modern Equity (4th ed., 1991), counsel for Bridget Lynn argued “that one party was at a serious disadvantage to another by reason of poverty, ignorance or otherwise, so that circumstances existed of which unfair advantage could be taken; secondly, that the transaction was at an undervalue; and thirdly, that there was a lack of independent advice.”
On behalf of Olive O’Hara Lynn, reliance was placed on Provincial Bank of Ireland v McKeever I.R. 471, which found that the above assertion could be countered by proof of independent advice, or that the transaction was the free exercise of the donor’s will. Both matters were said to be established.
The Court considered the case of Carroll v. Carroll 4 I.R. 241 in which it was found that the rebuttal of the presumption of undue influence involved two main issues: “whether independent legal advice had been received and whether it could be shown that the decision to make the gift was ‘a spontaneous and independent act’ or that the donor ‘acted of his own free will’.”
In considering the present case, the Court found that “that the case is one giving rise to a presumption of undue influence and that the onus is therefore on the defendant to establish that the gift to Padraig (and the consent to that gift on the part of Bridget Lynn) involved the free exercise of the will of his parents.”
The Court found that independent legal advice had been received by both parents. It also found that “the transfer was the result of the exercise of the free will of Sean and Bridget Lynn.”
The Court noted that “This was not a situation involving ignorance, poverty or other vulnerability such as might create a situation of inequality.”
With regards to Bridget Lynn’s argument that she had not received maintenance from the land, the Court find that this was due to a failure by the family to transfer the farm entitlements to Padraig’s widow, Olive O’Hara Lynn.
The Court noted that someone was in fact farming the land, and that while Bridget Lynn claimed ignorance, evidence suggested that her son Michael was currently farming the land.
As such, Olive O’Hara Lynn could not be blamed for failing to transfer the income over to Bridget Lynn.
Thus, the Court dismissed both cases.