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He was the second son and third child of four of Thomas Farrer, 1st Baron Farrer (who was raised to the peerage but only in 1893 after Claude's death, so Claude was not styled "the Honourable") and his wife Frances Erskine (1825–1870), daughter of the historian and orientalist William Erskine (1773–1852) and his wife Maitland Mackintosh daughter of James Mackintosh by his first wife.