Teams
Forum List
Toggle sidebar

Farmland Sale Question

dafarmer said:
Terminate the lease as soon as possible. Have a lawyer check the will for any codicils that might prevent her from selling outside the family, but end the lease. Iowa law says before September 1, but leasee has until March 1 to vacate. No wheat or grain will be ready to harvest by then.
Click to expand...
To add to this, when the land transferred there should have been a title opinion done- any restriction or covenant would be on the abstract if she has access to that. If she doesn’t have that, usually the bank that handled the original transfer or the company that did the title work will have it
 
  • Like
Reactions: dafarmer
Definitely get some legal advice before doing anything especially when dealing with family. Have seen something similar play out with another family after a relative passed and siblings that did not get along that well both got some of the land from the estate. One sibling lived out of state while the other sibling's family had a lease agreement to farm that property from the now deceased relative. The sibling that inherited the land found another person to lease the property and when the other sibling found out threatened to sue them for breach of contract as they had to give proper notice of terminating the lease agreement by a certain date.

To complicate things more the sibling that inherited that piece of land was already suing the estate claiming that the will was changed before the death that altered how much land they were getting (they got less than the other sibling did and everyone in the family knew exactly why that was.) So after the mistake of not providing advance notice of terminating the lease then signing a lease agreement with another farmer outside the family the other sibling basically told them if you don't drop this ridiculous lawsuit against the estate that you basically have no chance of winning, they will sue for breach of contract for the leased land they were not given proper notice on. The lawsuit against the estate was dropped and the sibling allowed them to proceed to rent that property without any complications to the other farmer.

When it comes to land agreements especially when relatives are involved or prior lease agreements you definitely want to see out legal advice from someone that knows the ins and outs of those kinds of situations. If you go off assumptions just one mistake could result on financial or legal headaches of your own.
 
Another option
1. Get offer from Nieghbor
2. Get second higher offer from LLC she creates
3. Force first rights onto relative based on higher LLC offer
 
  • Like
Reactions: PineClone
FarmerCy1 said:
To add to this, when the land transferred there should have been a title opinion done- any restriction or covenant would be on the abstract if she has access to that. If she doesn’t have that, usually the bank that handled the original transfer or the company that did the title work will have it
Click to expand...
Or just go on Iowa land records and do a search you can pull it up right there
 
I do not care if it is a woodpile out behind the barn - get a lawyer in ND.
 
BCClone said:
It’s his problem, but he may be looking at a 1031 or a tax write off and the offer leaves and is gone. Then if she was truly interested in selling, that option is gone and then it’s a her problem.
Click to expand...

Except that's not how it works in today's real estate market. It is a seller's market. Not a buyer's.
 
BCClone said:
If she doesn’t have a FRR on it yes, those things generally limit people who will even mess with it.
Click to expand...

I understood it the contract to say that the renter has first right to match or exceed a potential buyer's bid.

No seller ever HAS to sell just because a potential buyer wants to buy.
 
  • Like
Reactions: Sparkplug
pourcyne said:
I understood it the contract to say that the renter has first right to match or exceed a potential buyer's bid.

No seller ever HAS to sell just because a potential buyer wants to buy.
Click to expand...
She doesn’t have to sell, but if she’s even going this far it’s very apparent that she is interested in selling. If she didn’t have any desire to sell, or the offer was not of interest, she would have just said no.
 
Clone Head said:
My niece owns 160 acres of farmland in North Dakota. She received an offer to sell from a farmer that owns some adjacent land. She currently rents the farmland to a relative who is very unethical and a PIA to deal with. The rental agreement, which expires December 1st, has a provision allowing the renter to match (or better) the offer. The farmer making the original offer needs the sale to happen before December 1st.

I don't have the specific language regarding the matching offer, but I assume she can sell the land to whoever she wants.

What are her options? Are there any circumstances where she has to sell to the relative?
Click to expand...
I'll echo the sentiment about getting a lawyer involved, but here's what I found with an AI search:

If you remain on the farmland after the lease expires and the landlord continues to accept your rent payments, North Dakota law assumes the lease has been renewed under the same terms for up to one additional year (NDCC 47-16-06). [1]
  • The Legal Catch: Under standard American real estate common law, only the essential terms of a lease (such as rent amount and payment dates) presumptively carry over into an automatic holdover period. [1]
  • Courts frequently rule that a Right of First Refusal is a separate, collateral option contract rather than an essential tenancy term. Therefore, if the property is sold during a holdover period, a landlord may argue the right expired, unless your written lease explicitly stated: "This provision applies to any subsequent extension or holdover period." [1, 2, 3]

The Right Was Triggered Before Expiration
If the landlord received a third-party offer and you were notified while the lease was still active, your right to match it does not expire just because the lease calendar subsequently runs out. Once triggered, the provision essentially transforms into a binding purchase option that you have a reasonable or contractually specified timeframe to execute, even if the lease terminates during the process.
North Dakota law does not grant statutory privileges or legal rights to renters simply because they take care of the land. Good stewardship, soil conservation, and routine maintenance do not create an automatic legal right to renew a lease, match a sale price, or receive compensation.
Instead, North Dakota law relies heavily on the principle of freedom of contract. The state views land care as a standard tenant obligation rather than an achievement that earns extra legal privileges. [1, 2, 3]

If she's wanting to sell to someone else, make sure she does not accept a rental payment more than her current agreement or it sounds like that will count as an assumed extension of the rental agreement. I think the key language to the current contract will have to do with whether the matching option expires once the rental agreement expires or if it is still valid past that time.

But 100% get a lawyer involved.
 
You must log in or register to reply here.

Latest posts

Help Support Us

Become a patron
Top Bottom