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Tenant Farmer Unwritten Leases

Jason Reed | June 13, 2023

Tenant Farmer Unwritten Leases

More than half of Kansas farmland or pastureland is rented, and a large number of those leases are unwritten or verbal leases. We receive a lot of questions from sellers and tenants regarding Kansas landlord-tenant law as it applies to unwritten or verbal farm and pasture leases.

 

 

Are verbal or unwritten leases recognized and enforceable under Kansas law?

 

Short Answer: YES.

While the Kansas Statute of Frauds generally requires that contracts related to the conveyance of any interest in real estate be in writing to be effective, there is an exception to this statute for leases of a term of one year or less. Accordingly, an annual verbal or unwritten lease for farm or pasture ground is recognized and enforceable

 

Does a verbal or unwritten lease automatically terminate at the end of the annual term? 

 

Short Answer: NO

After the annual lease term, if the farm tenant remains in possession of the real estate with the consent of the owner, then the farm tenant is presumed to be a tenant from year to year, and the verbal or unwritten lease will continue to renew on successive year-to-year leases unless the landowner properly terminates the lease. 

 

May a Tenant Assign or Transfer a verbal or unwritten lease under Kansas law?

 

Short Answer: NO

A tenant may not assign or transfer a verbal or unwritten lease without the written agreement of the landowner.

 

What Are the General Tenant Land Rights

 

A tenant has the right to possess and use the land to the exclusion of anyone else--including the landowner. Thus, while a landowner maintains the right to enter onto a leased farm or pasture ground to make reasonable inspections, repairs, show the property to prospective purchasers or future tenants, collect rent, and deliver a notice of termination, the landowner is excluded from interfering with farming operations, running his cattle on pasture ground, or even hunting without permission from the tenant.

 

General Rules Regarding Terminating a Verbal or Unwritten Farm Lease?

 

Perhaps the most confusing question of the landlord-tenant relationship is the termination procedure of farmland or pastureland. The statutory framework is, at best, unclear. It represents a multi-year, piecemeal attempt by the legislature to periodically address what it saw as unfair or unjust outcomes to tenants under older versions of the statute.

 

How do You Terminate a Tenant's Lease?

 

Generally, farm and pasture verbal or unwritten leases operate on a March 1 to March 1 calendar. A landlord wishing to terminate an oral lease of pasture or farm ground must do so via written notice to the tenant delivered no later than 30 days before March 1. Typically this notice is sent by certified mail, return receipt requested. Alternatively, the notice is personally served by a process server or Sheriff’s officer. The reason for this is to confirm that the tenant received the notice in the event there is a dispute. The written notice should also specifically provide that the date of termination is March 1. 

If the tenant has undertaken “customary tillage practices” or has already applied chemicals in anticipation of planting before receiving notice of the termination, then the landlord is obligated to reimburse the tenant for the services performed and for any chemical costs incurred. However, it does not otherwise alter the termination date of March 1.

 

What is the Termination Date of the Lease if a Tenant has Already Planted Fall Crops:

 

When a tenant has already planted fall crops before receiving the notice of termination, then the lease termination date is construed as being the earlier of either August 1 or the day after the crops are harvested. In other words, the technical termination date remains March 1 for notice purposes, but the effective date of the termination is modified by the operation of the statute. This is most common for those tenants that have planted a wheat crop in the fall.

 

What is the Termination Date of the Lease If a Tenant has Worked the Ground:

 

Another quirk occurs when a tenant has not yet planted a fall crop but has taken initial steps to work the ground. If the notice of termination is delivered after the 30th day preceding March 1 and the tenant has already “prepared [the ground] in conformance with normal practices in the area" for planting a fall crop but not yet planted, the termination date is established as either August 1 of the succeeding year or the day after the crops are harvested in the succeeding year, whichever is earlier.

 

What is the Termination Date of the Lease if a Tenant Occupies on a Year-to-Year Basis at the End of an Original Written Lease:

 

Yet another change to the termination framework occurs when a tenant occupies farm or pasture ground on a year-to-year basis after the expiration of a written lease. In those situations, a notice of termination must be given at least 30 days before the day and month established as the termination date under the original written lease.

 

What is the Termination Date of the Lease When the Tenant Occupies the Real Estate for Different Purposes:

 

The final consideration for termination of tenancy purposes is that differing effective termination dates can apply even within a single parcel of real estate. For instance, consider a situation where a tenant is occupying a quarter section in which 80 acres is pasture and 80 acres are farmed in winter wheat (i.e. a fall crop). If the landowner properly provides written notice on January 1, terminating the lease effective on March 1, then the tenant’s rights to the pasture ground will terminate on March 1. The tenant’s rights to the wheat ground are August 1 or the day after the winter wheat is harvested, whichever is earlier.

 

Understanding and properly managing the termination of existing leases is especially important for farm and ranch landowners as they prepare to market and sell their real estate. But, given the somewhat confusing statutory framework related to farm and pasture leases, it is easy for landowners to trip themselves up.

 

Disclaimer: This article is mean purely for educational purposes and a discussion of legal topics. It contains only general information. It is not legal advice, and should not be treated as such.

 

Professional Assistance: The reader must not rely on the information in any article as an alternative to legal advice from your attorney or other professional legal services provider. If you have any specific questions about any legal matter you should consult your attorney or other professional legal services provider.

Jason Reed, GC

Jason Reed, GC

General Counsel

Jason has over 25 years of experience in all phases of corporate law, such as due diligence, document review, financial analysis; real estate law including contract negotiations, drafting, private financing structuring, and business law cases. Additionally, during his years of private practice, Jason focused on estate planning (wills, trusts, powers of attorney), Medicaid planning and qualification, Elder Law including senior transitions, guardianships and conservatorships and probate admin...

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