Untangling the Confusion Surrounding Kansas Agricultural Leases
Ty Patton | May 7, 2019
More than half of all Kansas farmland or pastureland is rented. And a large number of those leases are unwritten or verbal leases. This can sometimes pose an issue for land owners when they prepare to sell their real estate if they aren’t familiar with the unique aspects of Kansas landlord tenant law as it applies to farm and pasture leases.
First and foremost, verbal or unwritten leases are recognized under Kansas law. The Statute of Frauds generally requires that contracts related to the conveyance of any interest in real estate be in writing in order to be effective. This includes the conveyance of a possessory interest such as a lease. There is an exception to the Statute of Frauds, however, for leases of a term of one year or less. Accordingly, an annual verbal or unwritten lease for farm or pasture ground is enforceable. In the event that, at the conclusion of the lease term, 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. The tenant will accordingly continue to occupy the real estate for successive year long leases unless the owner properly terminates the lease. A tenant may not, however, assign or transfer a lease without the written agreement of the landowner.
A tenant has the right to possess and use the land to the exclusion of anyone else--including the landowner themselves. Thus, while a landowner maintains the right to enter onto leased farm or pasture ground to make reasonable inspections, make repairs, show the property to prospective purchasers or future tenants, collect rent, and deliver a notice of termination, the landowner would be excluded from interfering with farming operations, running his own cattle on pasture ground, or even hunting the ground absent permission from the tenant.
Perhaps the most confusing aspect of the landlord tenant relationship when it comes to farmland or pastureland, is the procedure to terminate the lease. 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 under older versions of the statute.
Generally, farm and pasture leases operate on a March 1st to March 1st calendar. According to K.S.A. § 58-2506(a), a landlord wishing to terminate an oral lease of pasture of farm ground must therefore do so via written notice to the tenant delivered no later than 30 days prior to March 1st. The written notice should also specifically provide that the date of termination is March 1st. If the tenant, prior to receiving notice of the termination, has undertaken “customary tillage practices” or has already applied chemicals in anticipation of planting, then the landlord is obligated by K.S.A. § 58-2606a to reimburse the tenant for the services performed and for any chemical costs incurred.
If the leased ground is planted to alfalfa, and if the tenant obtained an alfalfa stand the prior fall, then K.S.A. § 58-2506a(b) provides that the landlord is obligated to compensate the tenant the “fair and reasonable value of all services performed in preparing and planting the alfalfa” and to reimburse the tenant for any seed, fertilizer, herbicide, or pest control costs.
When a tenant has already planted fall crops prior to receiving the notice of termination, then the lease termination date is construed as being the earlier of either August 1st 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 operation of the statute.
Another quirk occurs when a tenant has not yet planted a fall crop but has taken initial steps to work the ground. According to K.S.A. § 58-2506(c), if the notice of termination is delivered after the 30th day preceding March 1st and the tenant has already “prepared in conformance with normal practices in the area” the ground for planting a fall crop but has not actually planted the fall crop, the termination date is established as either August 1st of the succeeding year or the day after the crops are harvested in the succeeding year, whichever is earlier.
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, notice of termination must be given at least 30 days prior to the day and month established as the termination date under the original written lease.
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 is farmed in winter wheat. If the landlord 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, while the tenant’s rights to the wheat ground would be 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.
