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Senior Contributor

Including spouses in farm planning

I'm going to go out on a limb here and say this article will stir some strong opinions in our group! 

 

Can spouses of owners and successors be included in planning the future without causing business, family, and personal problems? The man who asked the question is the son-in-law working for his wife's family's farm. Despite managing the farm almost single-handedly over the past several years, he is not invited to family meetings. His wife says not to worry, that the meetings are for dealing with family business. This raises the question, who is family?

 

Dr. Jonovic tackles this tricky question in a column every farming family should read!

 

Including Spouses in Farm Planning

 

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11 Replies
Honored Advisor

Re: Including spouses in farm planning

Making decisions is very easy for some people, and very difficult for others.

My attitude is that as long as I can take the consequences, I do not mind making up my mind on an issue. The main problem much of the time is that people want to have decision power, when the consequences fall on others.

Decisions made "by committee" are often not ideal ones. I accept that Mike and pur daighter know production issues best. SIL knows repair and maintenance issues best. I knkw risk management/ financial issues best.

Lasy year, we had BIG problems over when and how much hay Mike decided to mow at a time. This year, we have said, " Those are your fields, so you decide." Going to be interesting....
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Honored Advisor

Re: Including spouses in farm planning

Specific thoughts to the article and individual situation:
The managing SIL may be taking personally something which he should not. I say this as a vice-president of a family-owned sub S corporation. The members of the Board of Directors are set out in our by-laws. None of our three spouses have ever been added as board members, and thus have no "voice" in the workings of that company, even though each holds minor shares of stock in it.

BOD meetings were always called by my father, who was President until he died. The line of succession was laid out in the last meeting before hisassing. i would suspect that this family may have formed a corporation, to hold the farming operation as an asset, easy to know, especially if the SIL is paid by that corporation for his management services. Also, every state has public registries, accessible online, where you can look up the articles of incorporation and any filed annual reports.

It sounds to me that the family members are dealng with issues they feel need to be worked out as directors, in their legal capacity, which CANNOT BE DELEGATED. They each have duties under the Articles of Incorporation, and cannot send a proxy to do that duty. (Stockholders can and often do appoint proxies to cast votes at stockholder meetings...not at all the same animal as a BOD meeting.)

In all honesty, I think CV needs to accept that he is NOT a director of the ownership entity. It doesn't sound like the Directors are micromanaging his work, unless there is unspoken interference in that role afoot. I think he is saying " I was good enough to run things for ten years, but not good enough to weigh in now." He is getting himself worked up over nothing. It seems clear to me that his FIL wanted his two children on the board, not spouses. Neither is unusual nor inappropriate.

The use of the word " board" is what triggered this line of thought for me. Boards don't just drag in extra bodies for the hell of it. Typically, a BOD will handle the business it has to handle behind closed doors. This is because the Directors deal with legal, personnel, and other sensitive matters, not meant for public knowledge.

This really is like working for any corporation. Employees at any level aren't included. It isn't personal, and CV wouldn't expect to meet with a non-family BOD, as a company employee, would he?

I would not have non-directors in my board meeting, either. They cannot vote, so their input would be advisory only. That says nothing at all, really, about whether or not spouses are or should be "involved" in decision-making.
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Veteran Contributor

Re: Including spouses in farm planning

hmmmm...after reading the Dr. Jonovic article a couple things strike me:

 

  • it seems to me that this is not a large family farm so those involved are all important to the success
  • given the SILs level of working management and involvement, intrinsically he would be included. Why is his wife not on board with him being included at the meetings?
  • most glaringly to me: why is SIL not asking FIL face-to-face about this - not in a confrontational manner, but an informational manner?

 

it sounds like SIL has been a very integral part of the operation and FIL might be being influenced unduly by the returning son. It also sounds like daughter and SIL need some guts. Is FIL slightly tyrannical? is son territorial even though he hasn't been there? Has SIL actually been making managerial decisions or is he basically a hired hand?

 

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Frequent Contributor

Re: Including spouses in farm planning

This us why we farm alone, to avoid all this.
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Honored Advisor

Re: Including spouses in farm planning

After re-reading the article,I am not at all uderstanding the many issues raised in your reply. CV's FIL ( Kurt) has goven him the answer he is going to get on this...these are " board meetings", which is certainly exactly what I surmised...BOD meetings are not the onky kinds of meetings families have to have, but they have specifc attendees, and specific agendas.

Kurt's reply clearly indicates that these are borth family decisions...those are the directors, not spouses. Legally, the FIL clearly has determined that his children, not their spouses, have roles as directors. I really see nothing wrong with that.

If he took a guy who admittedly didn't know anything about farming, who happened to marry his daughter, into the fold and taught him the farming business, that should be good enough. If not, it's a free country, and he can pursue his own farming enterprise, or look for a different job elsewhere.

We operate two LLCs that consist of Mike and me. When we need to conduct LLC business, it is just us two. That doesn't mean our kids are excluded from involvement in production decisions, it just means we haven't handed over those reigns yet.

People can choose to be offended or not. I don't think CV should worry about this meeting thing. He is just going to cause trouble in his own house, if he can't trust his wife to look out for the best interests of the two of them.
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Honored Advisor

Re: Including spouses in farm planning

Lisa, might get some input on Farm Business.
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Senior Contributor

Re: Including spouses in farm planning

Great input, everyone ... I knew we'd have some opinions here! I agree that since we aren't talking about a huge family here (not 8 or 10 kids, no cousins, etc.), and since the SIL is actively working on and managing the farm, I just don't see why they don't include him. Maybe the real issue is that they don't want to include the daughter in law, and if they invite the SIL, there's no way to avoid inviting her? 

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Advisor

Re: Including spouses in farm planning

Yes,  we all know about those  evil  DILs.  LOL

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Honored Advisor

Re: Including spouses in farm planning

Lisa, I think it is simple, and it's not. If you make someone a Director, which is how you " include them in a board meeting", then, you have to go through formal removal processes if you want them out...let's say there IS a divorce.

There are many and various ways to include a SIL who is in a key role in decisionmaking, without altering the makeup of the BOD. The FIL's response was clear to me...these are blood- kin meetings only. Sometimes, we have to accept that, and not get our tail in a knot.

CV's wife indicated that there were " family things to work out." I honestly believe that each spouse has to deal with the issues of their own birth family. Period.
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