Ohio’s verbal farm crop lease termination date is September 1

The deadline is looming for farmland owners to notify their tenant operators of the intent to terminate a verbal farm lease that doesn’t include a termination date.  A landowner who attempts to terminate such a lease after September 1 could find themselves in a legal dispute with the tenant operator.  That’s because Ohio’s statutory termination date states that if an agricultural crop lease agreement does not provide for a termination date or a method for giving notice of termination, then the landowner who wants to terminate the leasing arrangement must do so by giving a written notice of termination on or before September 1.  Failing to do so means the leasing arrangement will continue for another lease period.

Here are several key things to know about the statutory termination date:

The parties can agree to a different termination date.  If the landowner and tenant have already agreed to a termination date or a process for giving notice of a termination, the statutory termination date law does not apply. Whatever the parties agreed to dictates how the parties terminate the lease.

Ways of giving the notice.  A landowner must give a written notice of termination, not a verbal notice. However, the landowner  can use U.S. mail, personal delivery, fax, or e-mail to deliver the notice.  The law does not specifically address using a text to send a termination notice, so landowners should avoid terminating the lease by text.

Termination language.  The law does not require any specific language for the termination. Recommended information to include in the termination is the date of the notice, a clear identification of the leased property, and a statement of the date the lease will terminate, such as “on December 31, 2026” or “upon completion of harvest.”

The statutory termination date doesn’t apply to tenants. Ohio’s statutory termination date only applies to landowners, not to tenant operators.

The law creates a legal remedy for tenant operators.  By requiring the landowner to deliver notice of termination by September 1, the law establishes a legal right for a tenant operator to challenge a termination given after that date.  The tenant operator can argue that the termination is invalid because it did not meet the deadline.  Legal remedies the tenant operator could seek include requiring the lease to continue for another lease period or paying damages for costs of the late termination, such as purchased inputs or completed field work.  The law gives the tenant operator leverage to negotiate these remedies or, alternatively, to take the matter to court.

An example.  To illustrate how the statutory termination law works, here’s a situation we’ve often seen in verbal farmland leases.  Landowner Smith and Tenant Jones verbally agreed to a crop lease ten years ago and never discussed how or when the lease would end.  Each year, Tenant Jones continues farming the land and paying the cash rent in April and December.  The two have talked very little other than the two times they discussed increases in the rental rate and once when they talked about a drainage improvement needed on the land.  Landowner Smith passes away in June, and his three children inherit the land. Tenant Jones harvests the crop, pays the second half of the rental payment to Landowner Smith’s estate in December, and purchases his inputs for the following crop year.   In January, the children notify Tenant Jones by e-mail that they want to terminate the leasing arrangement.  Because the children delivered the notice after September 1, the termination violates the statutory termination date.  Tenant Jones has a legal argument that the termination is invalid and should continue for another year or alternatively, that he should receive damages for costs and losses he incurred due to the late termination.

Don’t leave your lease to chance.  Many landowners and tenant operators use a verbal crop lease arrangement, but that’s a risky practice.  The parties can reduce leasing risk easily by using a written farmland lease.  Learn about how to establish an enforceable lease in this earlier blog post and visit our farmland leasing resources in the law library on the Farm Office.