[sunnyview87]

I was wondering if anyone has come across an issue like this.

I had a contract done up last fall to rent x amount of acres from a fella down the road and now I found out he sold the land and instead of honouring the contract, he would like to cancel it. Problem for me is I prepaid for seed and have delivery contracts set in place and was expecting to work the land until the contract expired.

My thoughts are that the contract was in place before the land was sold and that it should be honoured.

What are your thoughts?

 

[lostcause]

I agree you started working in good faith and held up to your end of the deal and they should hold up to there end

 

[V876]

I had a similar situation happen. After renting some land for many years and resigning the rental agreement in the summer, after harvest I had sprayed a fall app of round up and had banded fertilizer only to find out a month later the land had been sold. A land greedy SOB had bought some ajoining land and decided they wanted it. After several offers and refusals they finally threw enought money at my landlord that they sold.
Anyway I was only informed after the deal was done. In the rental agreement there was a stipulation that if either party terminated early there was a cash penalty. As we has just renewed a multi year contract They had to pay, also I got my lawyer involved to put a lean againt the land in the amount of the spray, fert and application fees.
I was paid out the cancellation fee and for the inputs and app fees, but that was applied product and the contract had the early cancellation fee written in.
It would depend how your contract reads as far as your legal rights. They may say you could cancell the seed but as to the delivery contracts I dont know what your options are.
If its just a unpriced production contract you may be able to cancell it too, but if you priced it, you may have to seed it on your other land to have product to deliver.
Not a good situation. Hope you can work it out.

 

[sunnyview87]

I was informed about the sale after-the-fact. There is no cancellation agreement in place. Just states that x acres is rented until contract expires at end of growing season. After contacting the seller/landlord and realty agent, it was never mentioned that there was a contract in place yet it's written out and signed by myself and the seller/landlord.

 

[morb1lee]

not a fair situation for you. figure out what he's costing you with inputs, application rates, etc. kindly tell him to foot the bill or honor the contract thru expiration. If not a lawyer will get involved and you'll be seeking the legal fees will too be paid by him. Hope it pans out, keep us posted.

 

[Ed_Hunter]

My brother forced the issue and the new owner had to rent the land until the contract ran out.

I know of another sale were the top bidder, pulled his bid after he was informed that some one else had the right to a 3 year rental agreement. The renter ended up buying the land.

Most rental agreement I have seen also include the first right to buy the land if it come up for sale.

 

[STR1]

That's a bad deal for you. Sounds like the landlord was playing both options........ have a rental contract in place as he tries to sell his land. I would assume if you have a rental contract in place prior to sale that you have the right to farm the land or be paid damages?
In any written contract I have for leasing land we always include a ROFR (right of first refusal) for duration of lease, as well a clause stating if land is sold and ROFR not exercised lease remains in effect with new owners for remainder of time period.
Unfortunately stories like this are happening more and more often as integrity seems to leaving the agricultural industry. A handshake used to be all that was needed but that is no longer the case.
Please keep us posted, I would not go away quietly, try to make them pay for not honouring agrrements!!!

 

[CDN]

If he only sold because they threw enough money at him that he couldn't refuse, he can likely afford to pay you penalties on your contract so you don't have to suffer a loss from him breaching your contract.


I would confront him about it and remind him that his decision has now left you with a financial obligation.


If he tells you to take a hike bring it to court.... unfortunately sometimes things have to come to that for everything to be fair and right in the end.

 

[mbfarmer]

If you have a signed contract the farm is yours to farm until the contract expires. That's the law. You will pay the new land owner rent.

 

[cptusa]

In the states the contract has to be cancelled or broke by September 1 of the previous year, or there is nothing that can be done about it unless the tenet and land owner both agree to early termination. Apparently there is no such law in Canada? Here you would be farming that ground even though it is sold, no questions asked.

 

[HFarms]

Any land contract that has a legal description and signed by two parties can be registered on the property title, that way if the landowner decides to sell without telling the other party, the agreement will show up in the title search that the lawyers has to do to complete the transaction. Always register your land rent contract, it cost a little bit of money but you can sleep in peace at night.

I learned this the hard way too. Hope it works out for you.

 

[sunnyview87]

Thanks for the feedback guys. My lawyer has a copy of the contract now and is waiting to draft a letter addressed to landlord on the written contract.

 

[m.t.dodge]

A similar situation happened to me a few years back. I went on holidays in march for 3 weeks and when I got home I found out a half section of land that I was renting was up for auction a couple weeks later. I was about to seed the second year of a three year contract. So I went to my lawyer and he said even if I'm not the new owner after the auction that I would be renting from the new owner for the remainder of the contract.

So I didn't have deep enough pockets to buy the land but I did continue to farm that land for 2 more crops. There was never an issue with the new owners.

 

[SWFarmService]

Here I have found you have two options, tell them both to shove it and stay farming it, or he has to buy you out on the remaining years of the contract, ex you rented of 50$ and have two years left on the contract you get 100 back from them so they can take possession

 

[Valley Farmer]

I bought some land years ago with an existing tenant relationship in place and I had to wait a year until it expired.
It was a neighbour who had rented it for years and had a year left so they just payed me the rent. Turned out okay as it was a lousy year and I made more money from the rent then I would have from farming it.

 

[hihi962]

Sounds like you have a poor relationship with your landlord, I communicate regularly with my landlords, preventing this situation from happening in the first place. I am assuming its a large amount of rented land, if it were only a quarter or two, you'd be nuts to forward price so much crop as to worry about contracts not being filled because of one or two quarters.
I know its tough, but I say too bad, thats the negatives about renting land, you have very little power or say. Sure you can write up the tightest legal contract ever, but then who's gonna wanna rent to you, I wouldn't rent to a guy that came to me with a 15 page contract thats protecting him to the nines and restricting me from selling it for years. Nor would I want to do that to my landlords.
I make simple contracts, covering the basics, basically covering input costs if they've been applied before I've had a chance to harvest them.

I dont think you have much of a leg to stand on here, you cant apply caveats or anything, because you didn't improve the land or apply product, sure you bought seed and what not, but courts will just say - use it next year, as its still yours and in your yard.

I don't think landlords or new landowners should have to up hold existing contracts, i would just expect them to see the season through if there were inputs applied, thats about it.

I strongly recommend not suing him at all, word would get out and you'll be renting even less land soon enough. Its funny, some of you are complaining how a hand shake is worth nothing anymore, yet for many the first option is to sue the landlord. Farmers are always their own enemies.

 

[lanwickum]

I was wondering if anyone has come across an issue like this.

I had a contract done up last fall to rent x amount of acres from a fella down the road and now I found out he sold the land and instead of honouring the contract, he would like to cancel it. Problem for me is I prepaid for seed and have delivery contracts set in place and was expecting to work the land until the contract expired.

My thoughts are that the contract was in place before the land was sold and that it should be honoured.

What are your thoughts?

I now have all my contracts written up by a lawyer and notarized when signed. Hoping if this happens I have the lawyer to help back me up. In reality, I try hard to get along with my landlords and so far they have all been great. Not saying it couldn't happen. When writing the contract don't forget to add a right of first refusal clause. Basically, you have the right to highest bid for the land if being sold. If it goes to court, there could be years of fighting and lots of money involved. An all out bad situation. Sorry to hear it.

 

[skgrain]

All kinds of people out there. One of our landlord refuses a written contract and just goes year to year.

Couple other landlords around here have their farms for sale but want to rent it too. The rental agreement is good until the day it gets sold.(or crop seeded I guess) Its not rented yet.

 

[cat man]

I was informed about the sale after-the-fact. There is no cancellation agreement in place. Just states that x acres is rented until contract expires at end of growing season. After contacting the seller/landlord and realty agent, it was never mentioned that there was a contract in place yet it's written out and signed by myself and the seller/landlord.

I didn't know my land lord owned land in Ontario also! Sounds like we are renting from the same guy. Same thing happened here I just signed a multi year lease and found out when I went to pay land rent the next spring that the owner did not own the land any more and that he sold it. So rent checks went to new owner for the rest of the lease. After the lease expire new owner will farm the land. New owner may be angry because he paid twice what it's worth and now gets to try farming it for the first time with $5.00 wheat. Now we'll see if the :hits-the-fan:. Might be up for sale again shortly. Only time will tell
the land is yours until the lease expires if you want it.

If you have a signed contract the farm is yours to farm until the contract expires. That's the law. You will pay the new land owner rent.

X2:54:

In the states the contract has to be cancelled or broke by September 1 of the previous year, or there is nothing that can be done about it unless the tenet and land owner both agree to early termination. Apparently there is no such law in Canada? Here you would be farming that ground even though it is sold, no questions asked.

I agree!

 

[cat man]

Here I have found you have two options, tell them both to shove it and stay farming it, or he has to buy you out on the remaining years of the contract, ex you rented of 50$ and have two years left on the contract you get 100 back from them so they can take possession

Yes I've seen that happen here also. You can offer for the new owner to buy your lease out and any work or money you have into it. Your in the drivers seat.