Rachel RespondsSeptember 21, 2018

I'm afraid the owner of my farmland will want to terminate the lease early.

Question:

What can I do about that?

Answer:

Make sure you have a written lease that specifies exactly when and how the lease can be terminated early. Make sure you are comfortable with the details, including conditions (when is it okay to terminate early?) and obligations (what does each party need to do for the other in the event of early termination?). Clear processes and expectations will help ease your fears and can also help you prevent it altogether, as both parties understand the costs.

Length of lease and conditions of termination are critical components of a written agreement. If the agreement doesn't specify the length of the lease, the lease can be terminate "at will" by either party. This generally means that the landowner can terminate the lease at any time so long as proper notice is given. If a lease is not in writing, or the writing does not specify the time period, default laws establish how far in advance a party must notify the other if they want the lease to end.

Other important components include a protocal for either renewing or ending the lease at the end of the agreed-upon term, and provisions for what happens to any improvements on the land--including unharvested crops and tillage--if the lease is terminated.

FOR MORE INFORMATION: Farm Commons' Lease Termination Tipsheet explains situations where early termination may occur and what preventative measures are available as well as other ways to manage the risks of early termination.

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