The Iowa Short Form serves as a structured guideline for owners and operators to craft an agreement tailored to their unique circumstances, specifically within the domain of cash rent farm leases. While it is instrumental in outlining the essential elements of such agreements, it does not supplant the need for professional legal counsel on matters concerning contractual relations between the involved parties. To ensure clarity and compliance with Iowa law, interested parties are encouraged to meticulously review and fill out the form available below.
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In the realm of agricultural operations, a well-defined and considerate framework for agreements between property owners and operators is indispensable. Within this context, the Iowa Short Form emerges as a pivotal guide, designed to tailor arrangements that satisfy the unique requirements of both parties. It explicitly clarifies that it is not a substitute for professional legal counsel concerning contractual relationships. This short form encapsulates a comprehensive approach towards establishing a cash rent farm lease, detailing every aspect from the lease's duration, usage of farm buildings and structures, to the nuanced division of expenses and maintenance responsibilities. Significantly, it addresses cash rent specifics, expectations for USDA Commodity Program Payments, and restricts recreational use without express permission. It insists on the operator’s duty to manage the farm with diligence, while also delineating the owner's obligations to protect and support the operator's tenure. Further, the form touches upon harvested crop rights, the prohibition of lease transfer without consent, and the mechanics for altering lease terms. It also introduces a security interest clause favoring the owner, outlines the procedure for termination upon default, and suggests arbitration as a means to resolve disputes. Additionally, this document is mindful of ensuring compliance with non-discrimination policies as stipulated by the USDA. Through its meticulous design, the Iowa Short Form aims to foster a clear, fair, and mutually beneficial relationship between the farm owner and operator, serving as a crucial instrument in the administration of agricultural leases.
This form can provide the owner and operator with a guide for developing an agreement to fit their individual situation. This form is not intended to take the place of legal advice pertaining to contractual relationships between the two parties.
IOWA CASH RENT FARM LEASE (SHORT FORM) FOR 20
Owner (s):
Operator (s):
1. Legal Description:
2. Terms of Lease: The term of the lease shall be for a period of year (s), beginning March 1, 20 . After
expiration of the initial term, the lease shall continue from year to year, unless terminated by a separate written agreement or by statutory termination notice served by either party on or before September 1, as directed by Iowa law, effective the following March 1.
3. There are
contract acres available according to county FSA records (FSA form 578).
The following housing, buildings and storage structures located on the Real Estate may be used by the Operator for the following purposes:
Structure
Purpose
In the event of damage or destruction of buildings or structures listed above the Owner will have the option to replace them or provide their functional equivalent to the Operator for the purpose described above within a reasonable period of time, or make adjustments to the terms of this lease in lieu of replacement.
4.Cash Rent: Operator agrees to pay the Owner cash rent for the use of part or all of the Real Estate as follows:
Description
Amount
Cropland
acres
@ $
/acre
$
Established hay land
Pasture
Buildings and storage structures, housing
Total annual rent
The cash rent shall be due and payable as follows: Due Date
Amount $
Due Date
All cash rent is to be mailed or delivered to the Owner at:
FM 1874/C2-16 Revised July 2016
date
owner (s) initials
operator (s) initials
page 1 of 3
5.USDA Commodity Program Payments: Payments shall be paid to the Operator unless otherwise agreed on with the Farm Service Agency.
6.Recreational Use: Use of the real estate is not allowed for hunting or other recreational purposes without written consent of the Owner.
7.Division of Expense: All crop production expenses are the responsibility of the Operator. Cost of lime and application will be treated as follows:
8.Expenses: No expense shall be incurred by the Operator for or on account of the Owner without first obtaining written permission from the Owner. The Operator agrees to take no actions that might cause a mechanic’s or other lien to be imposed upon the Real Estate and agrees to indemnify the Owner if actions are taken by the Operator that result in such a lien being imposed.
9.Repair and Maintenance: Minor repairs for buildings and fences: Owner will furnish all materials and Operator
will provide the labor at no charge. New fence: Owner to furnish all materials and one-half of the cost of labor. Operator to provide one-half of the labor and all of the equipment to construct fence. Owner will pay 100% of the cost to clear fence row when necessary.
10.Operator’s Duties: Operator agrees to operate the farm in an efficient and steward-like manner, control weeds and brush in the fields, fence rows, and road ditches, provide proper maintenance to control erosion and maintain terraces, waterways, and tiles, and building lots and all other areas of the farm where access is possible. The Operator agrees to furnish to the Owner by December 15 an annual report including 1) a summary of fertilizer, lime, and pesticide application records and 2) production or yield information about harvested crops each year, such as may be required for participation in Farm Service Agency programs or for setting crop insurance actual production history yields, and to use measurement methods acceptable for these purposes. Operator agrees, on termination of the lease, to yield prompt possession of the farm to the Owner and to leave the premises in as good condition as before they took possession or to compensate the Owner for damages.
11.Owner’s Duties: Owner agrees to warrant and defend the Operator’s possession against all persons as long as this lease remains in effect. The Owner will promptly pay real property taxes and carry insurance on his/her interest in the property.
12.Harvested Crop’s Aboveground Plants: Operator does not have the right to take any part of the harvested crop’s aboveground plant without the express written permission of the Owner. This includes burning or removing any crop residues from the property.
13.Transfer of Interest: The Operator agrees not to lease or sublet any part of the Real Estate nor assign this lease to any other person or entity, nor sublease any or all of the property described herein without prior written permission of the Owner. This lease shall be binding upon the heirs, assignees, or successors in interest of both parties. If the Owner should sell or otherwise transfer title to the Real Estate, the Owner will do so subject to the provisions of this lease.
14.Changes in Lease Terms: The conduct, representation, or statement of either party, by act or omission, shall not be construed as a material alteration of this lease until such provision is reduced to writing and executed by both parties as an addendum to this lease.
15.Right of Entry: The Owner reserves the right to enter the premises at any time for any reasonable purpose. Upon notice of the lease termination, the Operator agrees to permit the Owner or the Owner’s lessee or agent to enter the premise to do customary tillage and operations on any land from which the current crops have been harvested
page 2 of 3
16.Owner’s Landlord’s Lien and Security Interest. The Operator acknowledges that a statutory Landlord’s Lien exists in favor of the Owner. The Operator also grants to the Owner a security interest in, but not limited to, all growing or mature crops on the Real Estate as provided in the Iowa Uniform Commercial Code. The Operator shall sign all documents and financing statements as requested by the Owner to perfect the Owner’s security interests.
At Owner’s request, the Operator shall provide the Owner a list of potential buyers for the crops grown on the farm. The Operator agrees to deliver and sell such crops only to those buyers listed. The Owner shall deliver a Notice of Security Interest to those buyers and only those buyers listed. The Operator shall not sell such crops to any buyer not listed without first obtaining written consent of the Owner.
17.Termination upon Default: If either party defaults in the performance of the existing rental agreement, the non-
defaulting party shall serve a notice of default upon the defaulting party. The defaulting party shall have days
to cure the default. Failure to cure within the required timeframe shall terminate the lease. If the lease terminates because the Operator failed to pay the rent due, all costs and attorney fees of the Owner to enforce collection or performance shall be added to the obligations payable by the Operator. The Operator shall also be liable for interest
on the unpaid rent at the rate of
% APR.
18.Other Provisions:
19.Arbitration: Any disputes between the Owner and Operator not covered by this lease may be submitted by either party for arbitration at a reasonable fee by three disinterested persons, one of whom shall be selected by the Owner, one by the Operator, and the third by the previously named two. If and when disputes are submitted, a majority decision of the arbitrators shall be binding upon the parties to the lease.
We agree to the terms and conditions of this lease and we affix our signatures this
day of
, 20
.
Signature of Operator
Signature of Spouse/Co-operator
For (business entity)
Address
Telephone
Optional Notarization
Signature of Owner
Signature of Spouse/Co-owner
By (owner’s representative)
STATE OF
, COUNTY OF
ss:
This record was acknowledged before me this
day of,
, by
Signature of Notary Public
page 3 of 3
The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, gender, religion, age, disability, political beliefs, sexual orientation, and marital or family status. (Not all prohibited bases apply to all programs.) Many materials can be made available in alternative formats for ADA clients. To file a complaint of discrimination, write USDA, Office of Civil Rights, Room 326-W, Whitten Building, 14th and Independence Avenue, SW, Washington, DC 20250-9410 or call 202-720-5964.
Filling out the Iowa Cash Rent Farm Lease (Short Form) is a clear step towards establishing a formal agreement between a landowner and an operator for the leasing of agricultural land. This document serves as a foundational guideline to ensure that both parties align on terms concerning the rental period, payment structure, and use of the land and any structures on it. It's crucial to approach this form with attention to detail, ensuring every section is completed accurately to reflect the agreement between the involved parties. Here are the steps needed to fill out the form:
By carefully following these steps and ensuring that all information is accurately reflected in the form, both the Owner and the Operator can enter into their lease agreement with a clear understanding of their rights and responsibilities. It's a legal document intended to prevent misunderstandings and disputes, making it essential to the successful and mutual benefit of the leasing arrangement.
What is the Iowa Short Form?
The Iowa Short Form is a guide designed to help owners and operators develop an agreement for farm land rental. It outlines terms and conditions for leasing, including duration, rent, use of property, and responsibilities of each party. It's not a substitute for professional legal advice.
How long does the lease last under this form?
Typically, the lease begins on March 1 and lasts for the period stated in the agreement. Initially, it may be set for a year or more, then it continues on a year-to-year basis unless either party decides to end it by giving notice by September 1, effective the following March 1, as per Iowa law.
What does the cash rent cover?
Cash rent under this agreement includes payment for the use of cropland, established hay land, pasture, and any buildings or storage structures on the real estate. The total annual rent and payment schedule are specified in the agreement.
Are Operators allowed to make changes or incur expenses on the property?
Operators must obtain written permission from the owner before incurring any expenses on behalf of the owner or making changes that could result in a lien on the property. This includes agreeing not to lease or sublet any part of the real estate or assign the lease without the owner's consent.
What are the responsibilities of the Operator regarding the farm's upkeep?
The Operator is responsible for maintaining the farm efficiently, controlling weeds, brush, and erosion, maintaining structures, and providing annual reports on crop production. At the end of the lease, the Operator must return the farm in as good condition as initially received or compensate the owner for damages.
What are the Owner's obligations?
The Owner must ensure the Operator can possess and use the property without interference, pay property taxes, maintain insurance, and supply materials for certain repairs and new fences. The Owner also has the right to enter the property for reasonable purposes.
Can the Operator use the property for hunting or recreational purposes?
Hunting or other recreational uses are not permitted without the written consent of the Owner. This helps protect the property and ensures it's used primarily for its intended agricultural purposes.
What happens if there's a dispute or need for arbitration?
If disputes arise that are not covered by the lease agreement, either party may submit the issue for arbitration. This process involves three disinterested individuals making a binding decision. The aim is to resolve conflicts impartially and avoid lengthy legal battles.
Not securing professional legal advice: One common mistake individuals make when filling out the Iowa Short Form is not seeking legal advice. This form is a guide for developing an agreement but does not replace the need for legal counsel to ensure the contract meets all legal requirements and protects the parties' interests.
Incorrectly identifying parties: Misidentifying the owner and operator or failing to include all relevant parties in the agreement can lead to significant issues. It's critical to accurately list everyone involved to ensure the lease is legally binding and enforceable.
Omitting the legal description of the property: Not providing or inaccurately detailing the legal description of the leased property is a mistake that can cause disputes over what land and facilities are actually included in the lease.
Miscalculating the lease term: Another common error is not clearly specifying the lease term, including start and end dates, which can lead to misunderstandings about the duration of the agreement and conditions for renewal or termination.
Neglecting to specify rent amounts and due dates: Failing to clearly outline the cash rent amount, due dates, and payment methods can lead to disputes over financial obligations. This information should be detailed to avoid any ambiguity.
Overlooking USDA Commodity Program payments: Not clearly stating how USDA Commodity Program payments will be distributed between the owner and operator can result in disagreements or financial loss.
Not detailing the division of expenses and responsibilities: It's essential to specify who is responsible for crop production expenses, repairs, maintenance, and improvements to the property to prevent disputes.
Forgetting to include provisions for repairs and maintenance: Not outlining the responsibilities for minor repairs, fence construction, and other maintenance activities can lead to confusion and disagreements about who is responsible for what actions.
Ignoring the need for written permissions: Many operators assume they can undertake certain actions without written consent from the owner. However, the lease requires written permission for recreational use of the property, incurring expenses on behalf of the owner, and selling crops to unlisted buyers, among other activities. Neglecting to obtain this permission can lead to breaches of the agreement.
When preparing for or managing a farm lease, it's important to have access to and understand various forms and documents. While the Iowa Short Form Cash Rent Farm Lease provides a solid foundation for an owner and operator agreement, there are other valuable forms that can enhance or further specify the terms of leasing, ensure legal compliance, and help protect the interests of both parties involved.
In conclusion, compiling and understanding these additional documents when working with the Iowa Short Farm Lease can provide clarity, security, and compliance for both the owner and the operator. Ensuring all parties understand their rights and responsibilities can lead to a more successful and mutually beneficial leasing arrangement.
The Iowa Short Form Cash Rent Farm Lease shares similarities with a Residential Lease Agreement, primarily in structure and purpose. Both outline the terms under which property is rented, specifying the duration of the lease, payment schedules, and responsibilities of both parties regarding property maintenance and expenses. While the former focuses on farmland, the latter deals with residential properties, yet each ensures organized financial and operational relationships between landlords and tenants.
Comparable to the Iowa Short Form is the Commercial Lease Agreement, though it concentrates on commercial properties instead of agricultural land. Similar elements include the lease term, payment agreement, and conditions regarding the property's use and maintenance. The primary distinction lies in the Commercial Lease's emphasis on business activities and compliance with applicable zoning laws, underscoring the diverse applications of lease agreements tailored to different types of property and usage.
Another document resembling the Iowa Short Form is the Property Management Agreement. This contract establishes the arrangement between a property owner and a manager, detailing responsibilities such as tenant relations, rent collection, and maintenance oversight. The similarity lies in the operational and maintenance duties outlined, ensuring the property's value and functionality are preserved. The key difference revolves around the management role, with this agreement focusing on a third-party manager's duties rather than a direct landlord-tenant relationship.
Agricultural Partnership Agreements bear a notable resemblance to the Iowa Short Form, especially in defining the operational responsibilities and financial arrangements between parties engaged in farming activities. Both documents outline how expenses, labor, and revenues are shared or assigned, albeit the Partnership Agreement typically encompasses a broader scope of collaborative farming activities beyond the leasing of land.
The Equipment Lease Agreement parallels the Iowa Short Form in aspects such as leasing terms and conditions, but specifically for machinery or equipment rather than real estate. Both specify the duration, payment terms, and responsibilities for repair and maintenance, ensuring clear expectations are set for the use of leased assets. This highlights the adaptability of lease agreements to various assets, ensuring protection for both parties involved in the leasing transaction.
Lastly, the Crop Share Lease Agreement is closely related to the Iowa Short Form, as both engage in the specifics of agricultural leases. The Crop Share Lease typically involves an arrangement where the landowner and the farmer share the costs and the harvested crops, emphasizing a partnership approach rather than a fixed rent payment. While sharing similarities in defining operational responsibilities and resource sharing, the distinction lies in the variability of rent based on crop yield, introducing a risk-sharing component between the parties.
When dealing with legal forms, accuracy, and understanding are paramount, particularly when it comes to specialized documents such as the Iowa Cash Rent Farm Lease (Short Form). This guide aims to walk through some key dos and don'ts to help ensure that these forms are filled out correctly and effectively, keeping both the owner's and operator's interests protected without requiring unnecessary legal intervention.
Things You Should Do
Things You Shouldn't Do
Filling out the Iowa Cash Rent Farm Lease (Short Form) accurately is vital to ensure that the agreement between the owner and operator is legal and binding. By following these dos and don'ts, both parties can enter into the lease with a clear understanding of their agreement, reducing the likelihood of issues arising during the lease term.
Understanding the intricacies of the Iowa Cash Rent Farm Lease (Short Form) is crucial for both landowners and operators. However, there are several misconceptions about this document that need to be addressed. By clarifying these misunderstandings, parties can ensure they enter agreements with clear expectations and protection. Here are nine common misconceptions:
The form replaces legal advice: Many believe that filling out the Iowa Short Form negates the need for legal counsel. However, this form is designed to guide in developing an agreement tailored to individual needs and does not substitute for personalized legal advice.
It’s a one-size-fits-all solution: Another misconception is that the form suits every situation between a landowner and an operator. While it provides a good foundation, every deal has unique aspects that might not be fully addressed by a standardized form.
Termination process is automatic: Some think the lease automatically terminates without action. In reality, the lease continues year to year unless a written agreement or statutory termination notice is issued by September 1, as per Iowa law.
No need for documentation of expenses: The belief that operators can incur expenses without owner approval is incorrect. Written permission is required for any expense on behalf of the owner to prevent misunderstandings or unauthorized financial commitments.
Unrestricted use for recreation: The misconception that the operator can use the land for hunting or recreational activities without consent is common. Written permission from the owner is required for such uses to protect the property and liability concerns.
No report is necessary: The idea that operators are not required to provide the owner with an annual report is false. Detailed records of operations, including applications and yield information, must be furnished to the owner by December 15 each year.
Operator has full control over crops: Some may wrongly assume the operator has free reign over harvested crops. Without express written permission from the owner, operators cannot take action on harvested crop’s aboveground parts, ensuring the owner's interests are respected.
Subleasing and transfer rights: The belief that the operator can freely lease or sublet the property is incorrect. Any such actions require the prior written consent of the owner, maintaining control over the property’s use.
Owner’s responsibilities are limited: Lastly, there's a false impression that the owner’s role is largely hands-off. In reality, the owner must defend the operator’s possession, pay property taxes promptly, and maintain insurance on their interest, showing a collaborative relationship between owner and operator.
Clearing these misconceptions ensures that both parties have a solid understanding of their responsibilities and rights, leading to a more harmonious and productive leasing relationship. Always consulting with a legal professional to address the specific needs of your situation can provide further protection and clarity.
When navigating the complexities of filling out and using the Iowa Cash Rent Farm Lease (Short Form), it’s crucial to keep several key points in mind. These will ensure a smooth agreement process between the owner(s) and operator(s) and help both parties to develop a contract that suits their individual situation.
It's important to remember that while the Iowa Short Form provides a structured outline for a leasing agreement, it should be tailored to each specific arrangement and reviewed by a legal professional to ensure it meets all necessary legal standards and requirements.
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