1. Deadline Approaches to Terminate Verbal Farm Leases
By Tom Dorn, UNL Extension Educator

Generally, the turnover rate for rental land is very small in Nebraska, averaging about 8 percent. On average, leases on agricultural land run for 15 years. This reflects the high level of communication between landowners and tenants and the high regard most landowners have for the ability of their tenant to produce top yields while being a careful steward of the land. Usually changes that occur are because of producer downsizing or expanding. Only in a few cases does a landlord terminate a lease because of poor management practices.

Under Nebraska law, oral (unwritten) leases are legally presumed to be year-to-year leases. A year-to-year lease has no fixed time period and is automatically renewed for another year until proper notice has been given to the tenant by the landowner (or vice versa) that the lease is terminated.

Written leases are in effect only for the period specified in the lease itself, which may be one year, five years, etc. For written leases, no notice is required from the landlord to the tenant that the lease will not be renewed unless the lease specifically states that notice of termination is required. Unless it contains a renewal clause, the lease automatically terminates at the end of the lease period. The tenant generally has no right to have a written lease renewed unless the lease contains a renewal clause.

If a tenant "holds over" by not leaving after a written lease has ended, the tenant is legally considered to be a trespasser whom the landlord may remove by going to court. If the landowner does not remove the tenant, however, a year-to-year lease is automatically established by implication. If a holdover tenant begins to work and incurs expenses for the next year's crop, the courts generally have ruled that the landowner has agreed by implication to the tenant's holding over.

The most common legal issue associated with verbal farm leases is how a lease may legally be terminated. For year-to-year leases and holdover leases, six months advance notice must be given to legally terminate the lease. However, the lease date (the date from which the six months is counted) is different.

Oral year-to-year lease termination. For year-to-year leases, the Nebraska Supreme Court has ruled that the lease year begins on March 1. Notice to a tenant to vacate under an oral year-to-year lease (legally referred to as a "notice to quit") must be given six months in advance of the end of the lease, or no later than August 31.

Holdover lease termination. On holdover leases, the lease date is established by when the lease began in the original written lease rather than automatically being March 1. If the original written lease began January 1, the notice to quit from the landlord to the holdover tenant would have to be given at least six months in advance of the end of the lease, or no later than June 30.

To make a lease termination process go smoothly, follow these tips:

• Usually a tenant will know about the termination of a rental contract before the deadline, but notification still needs to be done formally and legally. The landlord needs to prove he or she has sent the tenant a notice of termination. This notice should be a registered letter written by an attorney. Be sure the notice arrives by August 31 and have proof that it was sent.
  
  
• An attorney should be involved in all stages of the termination process. It's easy to make a mistake, and something done wrong won't stand up in court if a disagreement occurs.
  
  
• A tenant should never let a rental agreement reach termination due to poor management practices. Keep the line of communication open and visit with the landlord regularly.
  
  
• If the tenant disagrees with the termination, he or she should visit with the landlord to see what can be done or for the reason for the termination.

2. Factors To Consider When Selling CRP Land
By Tom Dorn, UNL Extension Educator

The Conservation Reserve Program (CRP) has been an integral part of the USDA farm program since the 1985 farm bill. Under CRP provisions, highly erodible land or riparian land along streams and rivers is planted to permanent cover (forages and/or trees) and is not harvested while the contract is in force. In exchange, the landowner receives annual payments for the life of the contract. (Exemptions to the ban on haying and grazing forages have been granted in some disaster situations, usually with a reduction in government payments).

Recognize that the government has made a large investment in every tract of land that is enrolled in the CRP. Each site has required expert technical assistance to determine eligibility under the rules, seeding recommendations, follow-up assistance and monitoring. The largest up-front expense was the cost-share funding to establish the permanent cover. Considering the investment, it is understandable that the government would want the contract to stay in force for the full term. The law stipulates severe penalties for cases when the owner does not comply with the rules or intentionally breaks the contract.

If a participant fails to carry out the terms and conditions of a CRP contract, CCC may terminate the CRP contract and the participant would forfeit further payments under the contract, refund all payments previously received, plus interest; and pay liquidated damages as specified in the contract. If the Deputy Administrator determines such failure does not warrant termination of such contract, relief from the provisions may be authorized. Also, CCC may reduce a demand for a refund under this section to the extent CCC determines that such relief would be appropriate and will not deter accomplishment of program goals. (For the exact wording of the law, see the Federal Register on-line: 24830 Federal Register / Vol. 68, No. 89 / Thursday, May 8, 2003 / Rules and Regulations.

These issues can become particularly sticky when land currently enrolled in CRP is sold. If the new owner does not become the successor of the contract, who is responsible for the penalties outlined above? If a participant transfers all or part of the right and interest in land subject to a CRP contract and the new owner or operator does not become a successor to the contract within 60 days, or such other time as the Deputy Administrator determines to be appropriate, the contract shall be terminated and the original participant:

• Forfeits all rights to any future payments for that acreage
• Shall refund all previous payments received under the contract by the participant or prior participants, plus interest, except as otherwise specified by the Deputy Administrator.

3. Nebraska Fence Viewer Statutes
By Tom Dorn, UNL Extension Educator

An old proverb states, "Good fences make good neighbors". While this is generally accepted as a true statement, who must pay the cost of the fence that is constructed between two neighbors? Nebraska law addresses the subject of fences between neighboring properties. NU NebFact 98-390 written by NU Water and Ag Law specialist, David Aiken discusses the statute and its application. The following information is based on this publication.

Nebraska statutes provide that a person may collect a portion of the cost of a division fence from the neighbor if the statutory fence viewer procedure is followed. Under the fence viewer procedure, if one or both parties desire a division fence, the cost of construction and maintenance of a lawful fence shall be borne by both landowners. The law defines a lawful fence. Six basic fence types, including minimum standards for construction materials and post spacing, are described in detail within the statute.

The law further describes how disputes are to be settled. Either party can request the county clerk to call a panel of fence viewers to settle disputes. The duty of the fence viewers is to distinctly mark and define the proportion of the fence to be made or maintained by each party. The qualifications of the individuals on the fence viewer panel are carefully spelled out in the statute.

For more information refer to NU NebFact 98-390: Nebraska Fence Viewer Statues.