When parties disagree about farm rental arrangements, often an arbitrator or 3 rd party advisor is asked to intervene if a written agreement does not exist. However, even some written agreements may not included details necessary to resolve the disagreement.
What makes a well designed farm rental agreement? While most written agreements do include general terms like a description/location of the farm, who the tenant and landlord is, and the amount of cash rent or crop share percentages, some critical information may be missing to protect both parties.
For example, disagreements can arise about termination or renewal deadlines, and parties may look to Ohio law to find guidance. However, Ohio is a state that does not have a statutory law on farm lease termination or renewal, so it is important to define dates that both parties can agree to and include those in the written farm lease.
Does a written or verbal agreement imply a partnership? Does the agreement increase the landowner or tenant liability for the action of the other party? Who has access to production records from the farm and how does that impact Farm Service Agency program participation? Who pays for lime? Are the buildings included in the agreement and who performs repairs? These are just a few of the questions that can arise from poorly constructed farm rental agreements.
OSU Extension offers a Farm Rental Agreement Checklist to guide landowners and tenants toward a well written document that protects and benefits both parties. The checklist can be found at: http://ohioline.osu.edu/fr-fact/0003.html