Getting it in Writing – Agriculture Leases
The last time farmers and ranchers in Kansas were surveyed, over two thirds of all
crop and pasture land was leased and most producers had at least three landlords that they
deal with. Needless to say there are lots of different lease arrangements, and many
factors to consider and places where misunderstandings can happen. Additionally, many leases are still oral leases that are “signed” with a handshake.
One of the best ways to create a better understanding between tenant and landlord in most cases is to have a written lease. Having a written lease causes many topics to be discussed that otherwise might not. These would include, but are not limited to:
Payment due dates
In addition to the previously mentioned items a written pasture lease for example can spell out responsibilities of both parties in regards to:
Care of fences
Noxious weed control
Water supply maintenance
Grazing capacity restrictions and beginning and ending date of grazing season
A bonus of a written lease is that it documents the terms of the business relationship in case the contract is questioned, this can be especially important if the land changes hands.
Obviously, it is not necessary to have a written lease in order to have good communication between tenant and landlord but it can be helpful in spelling things out and avoiding misunderstandings and hard feelings. There may be some cases when introducing the possibility of implementing a written lease might damage the business relationship. Regardless of whether you have a written lease or not, make sure those lines of communication are kept open.
If you have questions about leases or leasing contact your local K-State Research & Extension County Office.
Kansas Lease Law
The following summarizes some of the provisions of the Kansas lease law.
1) In 2002 the law was changed so that the same termination date (March 1) and notification procedures apply to pastures, hay ground and cropland.
2) For non-written leases of pastures and cropland, notice to terminate must be given in writing at least 30 days prior to March 1 and fix tenancy termination date on March 1.
3) For fall seeded crops notice to terminate must be given in writing at least 30 days prior to March 1 and fix tenancy termination date on March 1.
Tenant has right to harvest crop, tenancy will terminate after harvest or August 1 whichever occurs first.
4) Recent Legal Ruling (2000): If notice is given early, BEFORE any field work starts for wheat crop in the fall, then lease is terminated on the following March 1.
5) Written lease termination notice terms will supersede state law for oral leases.
6) IF prior to termination notice, Tenant has tilled, applied or furnished fertilizers, herbicides, or pest control substances & has NOT planted the crop, THEN the Landowner must pay the tenant a fair and reasonable value of those services furnished.
7) Tenants Are NOT Allowed Compensation for Land Improvements UNLESS Otherwise Stated in a Written Lease
8) Unpaid Rent is an Automatic Lien on Crops.
9) With a crop share lease, a RENTAL LEIN attaches to the landowner’s share of the crop. The landowner must file to perfect this lien.
10) If Tenant Dies, the lease is terminated, no notice to the tenant’s heirs is necessary.
11) If Landowner Dies, heirs assume the lease.
12) If property sells, lease goes with property. If landlord fails to disclose lease to new owner they are responsible for making tenant whole.
As with all laws, lease laws are subject to change from legislative action or interpretation from judicial review. Consultation with a legal professional may be necessary. A KSRE publication on “Kansas Agriculture Lease Law” is available on our web site at www.ellis.ksu.edu
More detailed information on leasing arrangements, leasing guides to develop a written lease and further leasing information can be found on the K-State Research and Extension Ag Economics web site at www.agmanager.info