Leasing? Put It In Writing.

That's what Tiffany Dowell Lashmet, AgriLife Extension agriculture law specialist, says. "You never know what might happen between two folks with an oral lease, even if they are family or the best of friends,” she said. “Lease agreements certainly do not have to be lengthy and complex, but there are some terms you need to include to protect both sides.” Lease agreements help both parties think through possible issues or situations that they need to agree on before they shake hands and make a deal.  At a recent workshop in Amarillo, Texas, Dowell Lashmet recommended including the following in a lease: Describe leased property and limitations Include a map clearly showing the leased land and any important areas. Delineate where entry points to the property. Setting a stocking rate Be very clear on size, weight or animal units allowed. Be aware that this number may need to change based on drought or wildfire.” Maintenance of fixed assets “Who has to maintain things? Who has to pay for it? You can do whatever you want, but spell it out in the lease. Fences are a big deal. Who is required to maintain those fences and make sure periodic inspections are done?” Forum clause If the tenant and the landowner don't live in the same area, this clause identifies where you want any legal forum to be if an issue arises that requires court action. Dispute resolution clause “Suing people is expensive; consider a method of avoiding court and settling the ca

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3 thoughts on “Leasing? Put It In Writing.

  1. Might be worth having a discussion about leasing options. Many owners lease “by the acre” for a flat fee because it is easier and accept the risk that their tenant won’t overgraze. Some lease by cow days or animal units so there is a disincentive for overstocking and they accept risk of lower payments if the place is rested or understocked. My parents leased to an order buyer by pound of weight gain and managed the cattle themselves plus maintaining water and fences to maximize control and accept risk if on the profit/ loss side for over or understocking. They also had an out clause for drought that required destocking.

    Great article. I am a fan of clear, detailed and thorough communication. A written lease just ensures that we remember what was agreed upon.

  2. I would like to add a couple more items that I learned through the years.

    When oil companies moved in with seismographing and drilling, who receives payment for the damages to grass? For seismographing that damages the grass it should go to the lessee, not the lessor as the lessee may be suffering from less grass. Actual drilling for oil will bring up other issues that can cause problems.

    My leases were all by the acre and long term over a span of years. In law, at least in Colorado, the lessee has control of the land unless there are stipulations in the contract. In Colorado a lease can be filed at the courthouse. I failed to do so one lease and an oil company pulled in to begin seismographing without my knowledge. If I had filed the lease it would have shown up on a search by the oil company landman and I would have been notified and would have received damages to the grass I paid for. The land owner was contacted by the oil company and the deal was made with her. After a discussion between the three entities I received one half of the damages.

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