A Family Business Case Study
- Athole

When the patriarch of this family business case study dies, his 3 children inherit the sheep farm. One stays, one leaves, and the other agitates to sell-up and take the money. To satisfy their own needs, our case study shows how one Australian family is torn apart by conflict from within.

Our story begins early last century

In the New South Wales Riverina between Narrandera and Jerilderie, the Athole Pastoral Company straddles the Yanko creek, covering more than 10,000 hectares. It's flat, broadacre grazing land where thousands of sheep are bred for meat and wool production, alongside hundreds of head of cattle. In summer, the trees on the horizon shimmer in the haze of 40-degree plus heat. In winter, the frost on the ground freezes the puddles.

John and Bessie's 3 children - Catherine, Mary and John - are reared on the family farm. But for reasons that remain unclear, Bessie chooses to send her infant child, Mary, to live with relatives at Tylden in central Victoria. This leaves a legacy of separation and abandonment that will haunt Mary forever.

Yet their childhoods are mostly happy. Catherine and John grow up on Athole. Mary's adopted home becomes Tylden; surrounded by loving aunts, she creates and cherishes many happy memories there.

   John and Mary, circa 1926

Boarding at private schools in Melbourne, the children live through the Great Depression of the 1930's, World War II, rabbit plagues, shortages and good and bad seasons.

In the early 1950's, Queen Elizabeth II ascends the throne, the Korean War brings great prosperity to Australia's wool farmers, and the dream of the Snowy Mountains power scheme is about to become reality. The future looks bright.

The next generation

Together they raise 3 boys, continuing to graze about 8-9,000 sheep and about 200 head of cattle, while growing crops of lucerne and wheat.

Catherine, previously the #1 woman in the homestead, is now displaced and vies for relevance with John's new wife. Unable or unwilling to accept her changing role and work with others on the farm, her position becomes untenable.

Life goes on

She moves to Melbourne, chooses salubrious Toorak, and asks her sister to lend her half the money to pay for her new home. Mary agrees, joins her sister in Melbourne, and soon marries to begin her own family in the leafy suburb of Canterbury.

In the 15 years which follow their parent's death, Athole undergoes floods, bushfires, grasshopper and mice plagues, price fluctuations, drilling water bores, and destroying Bathurst burrs - no small matter when you consider that a neighbouring property is "... spraying them with an aeroplane... I hear they have sprayed about 4,000 acres and contemplating doing some more. This is in addition to about 17 extra men..."

Throughout these years, neither Catherine nor Mary works because each receives a third of the profits every year from John's efforts at Athole. Mary's income is further supplemented by her husband and an inheritance from her aunts at Tylden. In the good seasons this arrangement works well; in the bad seasons, John draws upon the company's bank overdraft.

The bushfires of 1963

The bushfires roar in on Christmas Day and last for days - "... we finally got this fire out about a week later, though there are still some trees on fire out in the burnt part," writes John. It would be 5 weeks before they stop a 24-hour vigil on its effects.

Before Christmas, Athole stocked 8,389 sheep; a livestock count two weeks later reduced the figure to 5,402. Some 2,987 sheep had perished - burnt, lost or shot. It was a stock loss of over 35%. More importantly, John writes of the type of sheep lost: "The worst feature revealed by the foregoing figures is that we have lost more than half of our breeding ewes."

Sheep numbers carried on the property are now significantly reduced and the ability to re-stock more than halved. The bushfire burns paddocks, pasture and fences, destroying just on 50 kilometres of fencing. The scale of loss is such that, some 7 months after engaging a full-time contractor to build new fencing, the job is only half-completed. These factors would combine to devastate income in the following years as John reveals: "...we'll have no income for the next 12 - 18 months."

Despite doubling the bank overdraft limit, both sisters continue to agitate for more money than the property can reasonably generate. By February 1966, the 3 shareholders of the family business are considering a loan of £40,000 (about $900,000 today).

Separate lives

Living the life of a wealthy socialite, Catherine is happiest amongst friends but seems unhappy with the family, often asking John for more money. If she ever considers repaying the outstanding housing loan to her sister, or her portion of the probate debt or even her father's bankdraft liability to her brother, she doesn't show it.

Mary, too, wants more money for her own family - recently married, she and her husband have a new home, 3 children and school fees to pay.

John continues to work the family farm, generating profits as best he can, looking after his wife and 3 young boys. It's a tough life, but it's all he knows.

Leasing Athole

Calls to lease the Athole property begin within a few years. By July 1966, John is arranging for an agent to promote the lease of some 16,500 acres (or 6,677 hectares), which includes all of Mary's land, more than 90% of Catherine's share, and about half of a joint allotment, all on a five-and-a-half year lease period.

This plan was reckoned to generate revenue of about $41,250 per year (equivalent to about $450,000 today) and might have worked, if only Mother Nature would help...

"The grass position is very grim indeed. In any case we'll have to get this country a spell. In the meantime the idea still is to get the stock off and hope for a good rain to grow some grass and make it look like it would be worth leasing."

Show me the money

By August 1968, Mary refuses to attend Athole Pastoral Company meetings, appointing a solicitor with power-of-attorney to act on her behalf. Discussions become increasingly acrimonious. Not surprisingly, Catherine and John also appoint solicitors to protect their separate interests as it becomes clear that Mary plans to sell. Within 5 months, without telling either sibling, she sells her share of the family farm.

Against this complex backdrop, Mary promotes the sale of Athole; John advocates staying; and Catherine sits on the fence, voting first with one and then the other in an endless cycle of tension and emotional games.

In April 1969, Mary withdraws her authority to sign any documentation for the family business, which denies anyone access to Athole's funds. The tactic brings the entire farming operation to a grinding halt.

In early October, John accepts that the Athole Pastoral Company is to be wound up and that the tenants-in-common portion will have to be sold.

March 1970 - end of an era

Within 6 months the family business is sold - the lands, buildings, machinery, livestock, furniture, the homestead... everything.

Expenses are deducted. Taxes are paid. The remaining money is split three ways... but only after Mary witholds the release of John's share of the money, piling further emotional leverage upon him to force Catherine to repay her housing loan in full.

What did they hope to gain?

From Catherine's perspective, 40 years of memories and emotional attachment are severed when circumstances force her to leave the farm. Certainly Melbourne was more expensive than living on a farm in country New South Wales... and wonderful times were to be had - horse racing carnivals, overseas holidays, collecting antiques, expensive clothing and champagne was the lifestyle she enjoyed. Financially it makes sense to sell.
          Catherine's passport, 1962

Mary had little real emotional attachment to the farm, having been taken away as an infant and forming stronger, more meaningful attachments to her new home at Tylden. If she gazes into her crystal ball, the sale of Athole might well represent financial security for her family; and if she plays her cards right, she can regain her money from Catherine at the same time.

John was a grazier at heart, rearing livestock, managing a large property and a man well-known and respected throughout the district. Selling one's property was anathema to farmers; far better to persevere with what you had. With his wife and family, farming is what he was born to do.

Payback

John swears never again to speak to Mary, and for the next 15 years, keeps his promise. Anniversaries, celebrations, even family funeral services are rejected. He dies in 1984, a man of his word.

The conflict thaws but recriminations linger for more than 20 years. Catherine dies in 2003, and Mary in 2006.

Observations - why act as they did?

  This family conflict seems to be   about money - about securing   one's own financial lifestyle.   Whether by accident or design,   these actions frequently occur   at the expense of siblings. Yet   appearances can be deceiving -   there are greater forces at work.

The real motivations behind this conflict are the needs of intimacy, recognition and economic well-being:

        * Mary's need is for intimacy and re-connection with her estranged parents and to ensure her own children remain intimate with her i.e. never to be abandoned as she was. The demands for her share of Athole were probably more about her need to be recognised as a part of this family and what was owed to her, more than the actual money itself. (Money was not an economic necessity for Mary, although it would have made her life easier.)

        * Catherine's need is for acceptance by her siblings and their immediate families. After 40 years at Athole she must have felt that her right to belong in her own home was dismissed (not recognised) upon being "evicted" from her home. 10 years later, the possibility for an improved lifestyle from the sale of Athole may have been irresistable.

        * John's needs are for identity, recognition and economic-well being... if Athole is sold, does he remain a grazier? What will he be and how will others see him? Will he be able to support his family if he is no longer on the property?

        * Catherine, Mary and John all have needs to be recognised as independent adults, leading separate yet interconnected lives.

Conclusion

The Athole Pastoral Company is a tragic Australian family business case study where the central players, the family, and the entity are torn apart by conflict from within. Long-running ploys over money frequently masked the greater cries for intimacy, recognition and economic well-being, and were a means of validating oneself by asserting control over others.

These tactics won the money but destroyed their relationships with one another.

To my knowledge, none of the main players ever revealed their real feelings to one another. Each harboured mixed emotions towards their siblings, grudgingly taking feelings of profound bitterness, angst, confusion and love with them to their graves.

In keeping with the deceased wishes, John's body was cremated and his ashes scattered over Athole's paddocks, near a favourite stand of trees. Catherine's body was interred beside her parents. And Mary's ashes were scattered amongst those of her husband and youngest son.

May their spirits rest in peace.

About the views expressed

I have endeavoured to represent a fair picture of all parties concerned, basing my views on research and family history. Where actual decisions or motives are unknown, I've attempted to explain their actions using my understanding of the people involved.

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