What is in this article?:
- Cropland leases: What producers need to know
- Maintenance of property
• In today’s world, producers realize that lease terms and misunderstandings as to the provisions in lease agreements can be costly and may even result in the complete breakdown of the landlord-producer relationship.
Attorneys who work in the area of agriculture and agricultural law regularly get questions about cropland and farm leases.
In today’s world, producers realize that lease terms and misunderstandings as to the provisions in lease agreements can be costly and may even result in the complete breakdown of the landlord-producer relationship.
While farmers are coming to the conclusion that written leases are necessary, too many written leases are incomplete, poorly drafted, or unfair to one of the parties to the lease.
This does not have to be the case. Cropland leases can be constructed so they are fair to both the producer and the landlord. Quality leases ensure the stability of the landlord-tenant relationship and the long-term farm profitability of the farm operation, by clearly describing the responsibilities and expectations of each party to the agreement.
(To see what a farmer can do to upset his landlord, see These actions will sour your relationship with a landowner).
This short article is not intended to provide legal advice or cover all of the legal issues that relate to a cropland leasing situation. Nevertheless, it highlights some of the cropland lease issues to which producers should give serious attention and consideration. When you consider your farm leases, you might give attention to the following issues.
Dates and signature — Alease should be written and provide both the beginning and ending dates for the term of the lease. The lease should be signed and dated by both parties.
Property description — Alease should contain a legal description of the real property and reference all buildings and improvements to be leased by the farm operator.
Termination clause — Both parties should understand and agree to the circumstances which may end the lease. Farmers should also insist the lease expressly state that they be given written notice of default along with a specified time period in which to respond to the landlord's notice of grounds for termination. Producers might also consider providing themselves an opportunity to cure the default, within the written terms of the lease.
Terms of rental — Alease should describe with specificity the rental agreement, including whether the lease is a cash lease or a crop-share agreement. The time at which payment is due should be specified, as well.