Lies, Scams, Disagreements, Misunderstandings – The Need for Written Agreements and/or Contracts

These two little stories I believe will illustrate where contracts or written agreements would have saved us from a lot of heartache as well as a considerable amount of money.

This first one happened back in the 80’s but it I will never forget how it felt to be betrayed. And that’s exactly how it felt – a betrayal by someone believed to be a friend.

This old boy was a cattle buyer and trader, but also our neighbor. and had been for several years. If we were milking in the morning and he drove up we knew that there was a calf to be pulled. Either this guy couldn’t or wouldn’t pull a calf. I never could understand why someone in the cow business had never learned to pull a calf. One spring he had bought a set of heifers that were bred to a white face bull and of the 40 head Donnie and I must have pulled about a dozen. But that’s what friends and neighbors did, they helped when they were asked or saw the need.

One morning we had pulled a calf and while we were just standing around waiting to be sure everything was OK, he began to tell us about this deal he was putting together, and if we were interested, it could make us some money. Folks when you are milking cows for a living, any idea that will make you a little money is of interest.

He claimed to have this deal worked out to send some cattle up North for those folks to put on winter wheat. Our son Donnie, who has been in this cow business since he was a little fellow, and I were not too impressed or sure about all of this. But we thought we could trust this old boy. After all we had sold cattle to him and he had always been fair and, we thought, honest.

The way this was to work was very simple. We would buy and graze the cattle until it was time for them to be shipped. What he was adding to the deal was his connections to the buyers. If memory serves there was a price locked in that would make this a moneymaker. (I asked Donnie to help me remember some of the details and his reply was “Daddy, I have been trying to forget this since it happened.” So I’m not going to quote a lot of numbers, not that it matters in the outcome.)

Well we did our part. We put together a set of 75 steers that seemed to be what was required. They were wormed and turned out on some leased land we had close to our milk cow pastures. Everything was working fine the grass was growing the cattle were getting fat it was looking promising. But when it came time to do his part it never happened, there was always an excuse or reason that it wasn’t time for the cattle to be shipped. We never could understand what happened. Either he never had this deal or somehow across the summer he screwed it up but he finally said that he could not help us sell these steers.

Now, we had made our first mistake by trusting this old boy. Then we made the next one. By now it was getting time to plant ryegrass so we decided to plant 50 acres more and carry these big steers until we could find a buyer on our own. We still believed we could do better than send them to the sale barn. The grass was planted and again it seemed that maybe we were going to be OK.

Instead, it turned cold and began to snow, and the grass went to hell, and we knew that we were not going to feed those big suckers. We finally found a guy up in Mississippi who agreed to come and look at them. The day he came it was cold, windy and snowing. When we got to the pasture you could not see a steer, they were all in a thicket getting out of this weather. We walked into the thicket and ran them out and this fellow just stood and watched them run by on the way to another thicket across the pasture. He made us an offer that if we would haul them to his place he would take them. By that time our only question “Where do want us to haul them to?”

After all the figuring we lost about $100.00 a head on this little enterprise. But the ryegrass was not a total loss, we did get some grazing out of it after it recovered from the cold weather.

Without question most of the blame was ours we made mistake after mistake, but the biggest one was taking the word of someone and not protecting ourselves. He told a lie and in the end we could not hold him responsible for anything.

For me it is very hard to realize and, to my way of thinking, very sad that after all of these years of doing business with a hand shake that it requires all of the legal stuff to protect ourselves. And it is really hard to ask someone who you consider to be a friend to put all of this on paper. It may seem to him that you don’t trust him. But it may be that this will save that friendship if there are problems down the road. This next little episode that I want to tell happened to be between friends and came about because neither party was very clear on what we were doing.

We had planted our ryegrass but it was not ready for cattle. We never start to buy calves until we have some idea just what the grass would be like. Our plan is always to graze them not to feed them. One day the phone rang and it was this friend of ours who owned a pretty big herd of black mama cows. After we had visited awhile he asked if we had bought any calves yet. When I answered no, he said he had a proposition for us. The deal was, he had 40 heifers that he wanted us to graze for him.  He felt like he was going to be short of grass and was willing to pay us to graze them for him. Again I am not going to get into the money but it was a good deal for both parties. For our part it seemed like a good deal we had spent the money and planted the grass but had not spent money buying calves. So if we grazed his calves we would free up our calf buying money to do something else.

We agreed to graze his heifers and things were going as well as could be expected. Then one morning in the middle of spring another phone call informed us that he intended to come and get his heifers on Saturday. The ryegrass on one of his places had put on enough growth that it needed to be grazed. There was no way that we could tell him that he could not haul his heifers off of our place. After all they belonged to him. So there we were a crop of ryegrass with nothing grazing it halfway through the grazing season.

Now understand this deal was paying off like a slot machine until the heifers were hauled off. But with not enough days to start another set of calves before the grass matured and became unusable for grazing, we sold it to guy in the hay business. In this case we made money and there were really no hard feelings. But if we had made an agreement as to the number of days we were to graze those heifers we would not have had to scramble to make it all work out.

I am not even going to try and tell anyone how to write a grazing contract or agreement. There are just too many variables such as type of cattle, time of year, sharing costs, death responsibility, delivery and pickup dates and payment. Yet, as hard as it is for some of us old heads to make up our mind to do it, with written contracts or agreements it sure can make it easier when everyone understands the deal. So keep that in mind when making a deal and consider these On Pasture articles as resources to help you.

Click below for examples of contracts that Meg Grzeskiewicz has built based on experience: