The parties to this Lease (the “Parties”) are as follows:
Landowner Farm Name: (1)
Landowner Farm Owner(s)’ Names:
Address:
City, State, Zip:
Hereafter referred to as the, “Landowner,” And
Incubator Farmer Name: (2)
Address:
City, State, Zip:
Hereafter referred to as the, “Participating Farmer.”

• (1) When it comes to a lease agreement, you need to be clear about who the contracting parties are. The farm incubator party will generally be whoever in fact owns the land, which is why the term “landowner” is used here. Note that if the title to the land has been placed in an LLC or corporation, the business entity will likely be the contracting party. Whoever has control to make decisions for the business entity will sign the lease and be the person(s) responsible for making sure all the terms are followed. However, it may be that the farm incubator project manager (whether it be an individual or a business entity) does not in fact own the land. Perhaps they’ve entered a lease agreement with the landowner to run the farm incubator project. If this is the case, it would be considered a “sublease.” It is very important to be sure that the actual landowner is okay with this “sublease” arrangement and that the underlying lease permits it. It may be that the landowner and the farm incubator project manager both need to be signatories on this lease.
• (2) If the participating farmer party is a business entity, keep in mind that most landowners will be hesitant to lease to a business without any further security or collateral offered by the individual farmer as a personal guarantee. This is because if the business is gone, it is hard to recover. So if the farmer has established a business entity and that business entity is the contracting party on the lease, the farmer may have to negotiate whether and to what extent she agrees to a personal guarantee. 

The Parties agree to the following, which taken as a whole, constitute this Lease:

1. Agreement to Lease

Landowner agrees to lease to Participating Farmer and Participating Farmer agrees to rent from Landowner the portion of land identified on Exhibit A: Map of Premises (3) (the “Premises”), subject to all the terms of this Lease.

Participating Farmer has permission to use the rest of Landowner’s property only as necessary to utilize the Premises, including vehicle access to and from the Premises (4) and to utilize equipment and storage specifically identified within this Lease. (5)

• (3) This means you have to create a map of the premises that identifies the exact boundaries of the leased areas and attach it to the lease as an exhibit. Alternatively, you can describe the leased premises in this section and remove the mention of an exhibit. Either way, it’s important that you provide as much detail as possible in defining the “Premises” so that all parties are clear on the portion of the land that is subject to the terms of the lease.
• (4) If you want to assign specific parking instructions or establish any restrictions about access such as times of day that are off limits or identify specific access routes to the overall property or the leased fields you can include that here.
• (5) Participating Farmer has no right, absent written permission, to wander the entire farm at will. This lease is for the “Premises” which is just the leased fields specifically, and for portions of the farm necessary to conduct the farm work, such as washing and packing facilities and storage areas.

2. Exclusivity as to Cultivated Portion

Participating Farmer has an exclusive right (6) to use all portions of the Premises that have been put under cultivation by [JUNE 1]. As to any portion of the Premises that is neither under cultivation by [JUNE 1] nor designated for fall cultivation in a written communication to Landowner (together, the “Uncultivated Areas”), Participating Farmer has a non-exclusive right to use the Uncultivated Areas for the remainder of this Lease term. Participating Farmer must secure written permission (7) from the Landowner (8) to use the Uncultivated Areas after [JUNE 1]. (9)

• (6) An “exclusive right” means that Landowner cannot use the portion of the land described as the “Premises” without the permission of Participating Farmer.
• (7) Requiring written notice helps prevent any confusion. Here, this could include a quick email around June 1 from Participating Farmer to Landowner saying, “I’m planning to use 50 more feet of a bed on the north side of . . . this fall, please confirm that you agree by replying to this email.” But any other writing will work as well, including a piece of paper outlining the request with the signatures or initials of both parties. Once Landowner provides written permission, Participating Farmer has the exclusive use of the “uncultivated areas” and any additional areas detailed in the email for the duration of the lease. On the other hand, if Participating Farmer doesn’t cultivate an area and doesn’t secure written permission to do so within the allotted time, Landowner can use it first. Agreeing to this type of arrangement will help maximize the use of the land.
• (8) Note that anytime this lease says Landowner, it’s referring to all agents of the farm operation—whether it’s the private landowner(s) (e.g., husband and wife) or the manager(s) of a business entity. Unless the agents have an agreement otherwise, any can commit Landowner. So that means Participating Farmer would only have to ask one person for permission and it counts against all.
• (9) Again, this kind of clause can help Participating Farmer and Landowner maximize the use of land even as circumstances or cultivation plans may change. The date and any of the parameters can certainly be changed, depending on the type of
  operation considered. However, if the land is leased for pasture, then the tenant would most likely use the entire pasture. In this case, this provision could be deleted.

3. Lease Term, Renewal, and Termination

This Lease begins on the date the Lease is executed (10). This Lease expires on [OCTOBER 31]. The Parties have the option of renewing the lease. Renewal shall occur only if Participating Farmer gives Landowner written notice of his or her desire to renew the lease by [SEPTEMBER 1]. If Participating Farmer does not give written notice of his or her desire to renew by [SEPTEMBER 1], the Lease shall terminate on the expiration date (11). Landowner has [30] days to provide written acceptance or rejection of the renewal proposal, after receiving notice of Participating Farmer’s desire to renew. If Landowner fails to provide written acceptance or rejection of Participating Farmer’s desire to renew, the lease shall automatically renew for the same period as the term of this Lease (12). If the lease is not renewed, Participating Farmer must place any cultivated areas into a suitable cover crop in a timely manner, such that the cover crop is established at the end of the Lease term.

The Lease may be terminated early upon mutual written consent by both Parties. The rent will be allocated pro rata based on the agreed upon termination date and any prepaid rent that exceeds the pro rata amount must be returned to Participating Farmer within 30 days. In addition, the parties each reserve the right to terminate the Lease upon breach of any of the terms of the Lease by the other party. The non-breaching party must give the breaching party written notice of the breach upon which the non-breaching party will have ten days to reasonably remedy the situation. If the breaching party fails to do so, the non-breaching party may terminate the lease. The parties agree to take reasonable steps to mitigate any damages arising from a breach. Upon early termination of the Lease, Landowner will have immediate rights to exclusive use of the Premises. The dispute and determination of any damages or monetary remedies to be awarded as a result of the breach will be determined pursuant to Section 16.

• (10) You can also specify a start date.
• (11) It can be wise to have the lease lapse in a year as the default. Therefore, no obligations automatically extend to either party for an additional year. However, if things get busy or for whatever reason the lease isn’t renewed properly before this date passes, the parties can always sign another lease.
• (12) Thus, if this lease is for one year, from January to December, then the lease automatically renews for the same January to December period. But, if the lease was just a six-month lease over the summer, it would renew for another six-month period over the summer. Meaning the lease wouldn’t be in effect during winter.

Permitted Uses

Landowner permits and consents to Participating Farmer’s use of the Premises for all of the following activities as well as any activities incidental to the agricultural uses of the Premises listed below: (13)
[List use(s) here, such as, production of annual crops;
Preparation for market of crops produced on the Premises;
Sale of crops produced on the Premises;
Raising of broilers, slaughter and preparation of broilers for market, raising of laying hens, preparation of eggs for market, sale of poultry produced
on Premises, sale of eggs produced on Premise, and so forth.]

Uses not expressly permitted (14) are prohibited (15) without the written consent of the Landowner. Landowner may approve, disapprove, require more information, or require certain modifications to any additional proposed activity at the Landowner’s discretion.

Participating Farmer may not have employees, including interns or volunteers, working on-site without the prior written consent of Landowner (16).

Participating Farmer agrees to comply with all federal, state, and local laws, regulations, ordinances, decrees and rulings in connection with any agricultural or other activities conducted on Landowner’s property (17).

• (13) This means that the tenant can’t use it for residential purposes, throw non-farm related parties, and that sort of thing.
• (14) Note that the permitted uses are quite broad. It includes everything on the list AND any activities incidental to the agricultural uses listed below. Incidental uses are those that necessarily accompany a specific use. For example, accepting a diesel delivery or compost shipment would be incidental and permitted because it’s necessary to run the farm.
• (15) You could otherwise detail specific activities that are prohibited. We would have some gray area if an activity is neither clearly prohibited nor permitted. For example, I might argue that slaughter is not incidental to raising of animals and that it’s an entirely separate operation. But that might not be another person’s understanding. So if this were the case, you may want to add the following: “Slaughter of animals is specifically prohibited.”
• (16) Allowing Participating Farmer to bring on additional labor—whether paid employees, volunteers, or interns—exposes both Landowner and Participating Farmer to liability. Landowner should be very cautious to openly allow it. Requiring written consent provides one safeguard. If employees are allowed, it’s highly recommended that clear policies are in place regarding what they can and cannot do. It’s also essential to make sure that all employee activities are covered by insurance, which may require Participating Farmer to carry workers’ compensation. See Section 12 on insurance for more on this.
• (17) For example, Participating Farmer is agreeing to follow the zoning code, to adhere to permitting requirements of the Clean Water Act, and all sorts of other things. Failure to do so is a breach of the lease.

5. Rent and Taxes

Participating Farmer shall pay to Landowner rent in the amount of $500, (18) due on the effective date of this Lease and delivered to the address listed above. A late penalty of 5% per month may be assessed on a late payment at the Landowner’s discretion. Participating Farmer agrees and acknowledges that the late penalty is necessary to compensate Landowner for lost interest, the opportunity cost of renting the property, and any fees or expenses in enforcing this Lease.

Landowner shall pay for all taxes and assessments on the Premises, with the exception of any taxes directly attributable to sales-based activities being conducted by Participating Farmer on Landowner’s property (19).

• (18) The rent amount must be negotiated between the parties. Note that many options other than cash are available for rental arrangements including crop share and hybrid models. See Farm Commons’ other lease materials for additional ideas.
• (19) The second half of the clause protects Landowner if Participating Farmer starts selling products that are taxable and those taxes end up being assessed to Landowner.

6. Utilities and Services

Landowner agrees to provide and pay for all utilities and services incidental to Participating Farmer’s use of the property including washroom or portable toilet facility maintenance, trash collection, lawn mowing, and electricity and/or natural gas services (20) as necessary for permitted equipment usage under Section 7 and permitted buildings and storage area usage under Section 8 (21).

Notwithstanding the paragraph below, Landowner agrees to provide and pay for irrigation water as necessary for Participating Farmer’s irrigation of the Premises via drip tape. If Participating Farmer wishes to use any other irrigation method aside from drip tape, written permission of the Landowner must be received in advance (22).

Participating Farmer specifically acknowledges and agrees to reasonable delay in the provision of irrigation water should the related equipment malfunction, water pressure drop, available capacity decrease, or other contingency occurs that is outside the control of the Landowner. The Landowner agrees to use best efforts to remedy any adverse contingency and resume the provision of irrigation water as soon as is reasonably possible.

Participating Farmer specifically acknowledges and agrees that irrigation may not occur between the hours of 7 a.m. and 1 p.m. on Monday through Saturday, unless verbal permission of the Landowner is received on the day Participating Farmer wishes to irrigate. (23)

• (20) In the way that this is written, Landowner must provide and pay for whatever electricity and/or natural gas services are required for using buildings, storage areas, and permitted equipment. For example, if access to a refrigerated storage unit is included as part of the lease terms then Landowner must pay for the electricity to run the refrigeration system. Or, if the Equipment Manual attached to the Lease specifies that a particular piece of equipment must be power washed after each use, Landowner must pay for the electricity to run the power washer for this purpose.
• (21) The way this clause is written provides just one example of how the utilities and services could be handled in a farm incubator situation. The parties could of course agree on a different arrangement. The key is to be clear on who is responsible and will pay for what. This clause should be as specific as possible. For example, if portable toilets are only provided at specific times of the year, the dates should be included. Or, if the lease runs through the winter in a place where it snows, you should include who is responsible for snow removal.
• (22) Depending on the geography of the area, water usage may be a significant concern to all parties. A separate water or irrigation section may be helpful to fully hash out all the issues surrounding water usage, including timing, flow rate, repairs, cost, etc. This is one example of the limitations Landowner and Participating Farmer may agree upon.
• (23) Here, just verbal permission is required given the spontaneous nature of the request. In this particular situation, it may be too burdensome to require written notice given it’s just a day’s notice. Whether written notice or verbal notice is required for any of the terms in the lease is up to the parties to decide. Keep in mind that while verbal notice may be more practical, written notice is generally preferred in contracts because it leaves a paper trail and prevents the ambiguities in a “he said, she said” debate if a dispute were to arise.

7. Equipment

Participating Farmer is granted a non-exclusive right to use the following of Landowner’s equipment:
[List equipment here, such as . . .
Kubota tractor,
Rototiller,
and so forth.]

Usage of the equipment must be coordinated with other users. In return for this right, Participating Farmer agrees to pay Landowner an equipment fee in the amount of $250 (24), due on the effective date of this Lease and delivered to the address listed above. The equipment fee includes fuel (25).

Landowner is responsible for regular maintenance of the equipment. Landowner will schedule and pay for any repairs resulting from regular, non-negligent use of the equipment. Landowner will schedule and pay for any repairs resulting from Participating Farmer’s negligent use of the equipment, and Landowner may invoice Participating Farmer for the cost of repairs caused by his or her negligent use (26). Unless the Parties otherwise agree in writing, Participating Farmer agrees to pay any invoice received from Landowner for his or her negligent use of the equipment within 15 days of receipt (27).

Participating Farmer acknowledges and agrees to adhere to each provision of the Equipment Manual (28) provided by the Landowner and attached as Exhibit B as a term of this Lease (29). Participating Farmer will demonstrate to Landowner that he or she has been trained in
safe operation of farm machinery before operating equipment. Landowner may accept or deny Participating Farmer’s training as adequate at his or her discretion (30).

Participating Farmer will return all equipment to its appointed storage location in a clean condition after every use.

• (24) The parties must negotiate whether an equipment- usage fee is charged and, if so, how much.
• (25) It’s up to the parties to decide whether fuel is or is not included in the equipment fee price. Another option would be to set an additional price for fuel by gallon. In that case, a system would need to be in place for tracking usage.
• (26) Again, any arrangement that works for all parties is possible here. In this example, Landowner must schedule and pay for the repair upfront so the equipment will be efficiently back in use. If a dispute about fault arises, that could hold up everything.
  Under the terms here, Landowner doesn’t have to invoice Participating Farmer if for whatever reason Landowner decides to cover the costs.
• (27) A security deposit is another way to address the costs that could be incurred if equipment breaks at the fault of Participating Farmer. However, beginning farmers may not have the money to pay upfront.
• (28) Of course, then we need to have this Equipment Manual! See Farm Commons’ model.
• (29) It’s not entirely necessary to attach an equipment manual to the lease. It helps though, because it proves all the papers were together in one place at the time of signing. If you take it out, just make sure that Participating Farmer has received the manual before signing the lease.
• (30) There isn’t a single ideal resource for beginning farmer training on equipment at this time. Hopefully one will emerge in the future. In the meantime, this clause is very flexible. Participating Farmer just has to show that he or she
  has done something—such as read a resource online, attended a class, etc.—that shows he or she is trained. Landowner can accept the training as adequate or request additional training efforts before allowing use.

8. Buildings and Storage Areas

Participating Farmer has a non-exclusive license to utilize designated areas for:
[List use(s) here, such as . . .
Washing and packing of produce (31),
Storing of hand tools and fuel in the barn,
using the washroom;
and so forth;]
and to access any other areas of Landowner’s property when necessary for use and maintenance of the equipment specified in Section 7 (32).

• (31) It may be a good idea to specifically identify the washing and packing area, which could be included on the map or description of the Premises. It’s also fine to do this verbally, as long as there has been a specific designation of a washing and packing area to make things perfectly clear. This is particularly important as more Participating Farmers come onto the scene. The same goes for the storage areas.
• (32) At some point, you may want to consider a chore schedule. Who cleans the bathroom? This would be a good place to specify that sort of thing. Of course, it could be an informal schedule, but if chores are expected as a part of “rent,” it belongs here.

9. Stewardship and Housekeeping

Participating Farmer agrees to use good stewardship of the Premises. Good stewardship is defined as adherence to the USDA National Organic Program (NOP) Handbook in addition to minimizing water and wind erosion. In accordance with organic standards, Participating Farmer agrees not to use any product that is not expressly approved by the Organic Materials Research Institute (OMRI). If any product is not clearly and expressly approved by OMRI, Participating Farmer must receive approval from Landowner before utilizing the product. If any farming or processing practice is not expressly allowed under the organic standards, Participating Farmer must receive approval from Landowner before implementing the practice. Participating Farmer, in collaboration with Landowner, agrees to make best efforts (33) to learn and understand organic practices and products set forth in the NOP Handbook and OMRI listings to determine if a practice or product is approved and in accordance with current organic standards (34).

Participating Farmer will not abandon the Premises or cease cultivation of the Premises without establishing a cover crop. Participating Farmer will not allow excessive weed growth on any cultivated portion of the Premises. Participating Farmer will prevent any unnecessary waste, loss, or damage to the Premises. Participating Farmer agrees to return all areas of the Landowner’s property that are used by Participating Farmer to a clean, tidy, and safe condition after each use (35). 

• (33) “Best efforts” is a phrase often used in contracts to provide a measure, albeit subjective, of something that is relatively hard to measure. What this means here is that Participating Farmer agrees to act in good faith and take reasonable steps to learn, understand, and abide by the organic standards. If a dispute arises, a court will consider the surrounding circumstances, including the experience and expertise of Participating Farmer and the complexities of the particular organic standard at issue to determine whether Participating Farmer acted in good faith and made her best effort to learn and abide by it.
• (34) If the incubator farm is certified organic or is in transition, it’s a good idea to include a requirement that Participating Farmer understands and follows the requisite organic practices. To take this lease seriously, Participating Farmer should make a special effort to really learn and understand the organic standards. Please note, however, it’s not entirely reasonable to expect that a beginning farmer will be fully up to speed on all the elaborate organic regulations and standards despite every intention to become an organic farmer. And it’s not an easy feat to learn! The incubator farm project can safeguard its own interest in gaining or maintaining organic certification by taking on some of the responsibility to train farmers and show them the ropes, so to speak. This could include providing training and technical support on organic farming practices.
• (35) This clause reinforces good stewardship practices to make sure that the land is left in as good or better condition as it was found. It’s important to include a provision requiring Participating Farmer to reasonably manage weed control to avoid creating a huge seed bank in one year.

10. Animals

Participating Farmer acknowledges and agrees to adhere to each provision in the Animal Husbandry Manual (36) provided by Landowner and attached as Exhibit C as a term of this lease (37). If Participating Farmer installs improvements such as fences or permanent, non-movable animal containment systems, the improvements become the property of Landowner upon installation, unless the Parties otherwise agree to in writing.

• (36) Such a manual should detail standards of care for various animals. Participating Farmer especially may need additional guidance for care.
• (37) One bonus of packaging animal information in a separate manual is that it keeps the lease from becoming too long. And, it’s easier to review the manual frequently and make changes as necessary. The lease, on the other hand, shouldn’t need to change often. However, we need to always make sure that the lease and the manual do not conflict. For example, don’t say that slaughter is allowed in the manual and then prohibit it in the lease. You can always make an exception, in writing, for a specific event without creating a conflict.

11. Improvements

Participating Farmer may not make alterations or improvements (38) to the Premises without written consent of Landowner. Consent shall be obtained by submitting a written description of the proposed improvement to Landowner. Landowner may approve, disapprove, require more information, or require modifications at his or her sole discretion (39). Written consent of Landowner will be considered given when the Landowner signs the written plan, together with any amendments or modifications.

• (38) Examples of alterations or improvements include putting up a new fence or packing shed, installing drain tile, grading to divert water flow, and those sorts of things.
• (39) Landowner should seriously consider whether and how any proposed alterations and improvements should be dealt with at the end of the lease term before approving the plan. For example, can Participating Farmer take the new shed with him or her?

12. Insurance

Participating Farmer shall at Participating Farmer’s sole expense continuously maintain insurance as follows:(40)
Workers’ compensation insurance, where required by law.
Liability insurance of not less than [$1,000,000] for injury to or death of any one person; and [$2,000,000] for injury to or death of any number of one persons in one occurrence; and [$100,000] for property damage. Such insurance shall insure Participating Farmer against all liability assumed under this Lease and imposed by law.
Automobile liability insurance on all automotive equipment used on the Premises in amounts not less than [$100,000] for bodily injury and the same for property damage and liability.
Participating Farmer shall name Landowner as an additional insured on any liability policy during the Lease term (41).

Participating Farmer will provide evidence of insurance to Landowner and Participating Farmer may not cancel his or her insurance policy without giving Landowner 30 days notice of the date of cancellation.

Participating Farmer will provide written evidence that injuries to Participating Farmer’s employees, interns, or volunteers are covered under a liability or workers’ compensation policy before Participating Farmer has employees, interns, or volunteers on the Premises.

• (40) Insurance is highly recommended to protect both Landowner and Participating Farmer. This is just one example of how adequate insurance could be dealt with. It’s up to the parties to come up with a reasonable risk management strategy, which may or may not include insurance. Another option would be to require Landowner to carry a robust commercial line of policy that would list Participating Farmer as an additional insured. If this was the case, the lease should also require Participating Farmer to maintain workers’ compensation insurance if required by law. For more on issues related to insurance, see Farm Commons’ insurance guide Managing the Sustainable Farm’s Risks with Insurance: Navigating Common Options, which is available for download on our website.
• (41) If Participating Farmer will use the buildings in a significant way—like storage of Participating Farmer’s tractor or valuable equipment—then you may want to require Landowner to carry fire insurance and to repair or replace those buildings or equipment as soon as practical if a fire occurs. Few Participating Farmers will have that kind of investment, however.

13. Indemnification

Participating Farmer shall indemnify, defend, and hold harmless Landowner against any liability and to pay for any and all damages, losses, or expenses that are incurred by Landowner in connection with the Premises that extend from Participating Farmer’s negligence or failure to perform the terms of this Lease. Landowner shall indemnify, defend, and hold harmless Participating Farmer against any liability and to pay for any and all damages, losses, or expenses that are incurred by Participating Farmer in connection with the Premises that extend from the Landowner’s negligence or failure to perform the terms of this Lease (42).

• (42) An indemnification provision is simply a promise by the other party to cover your losses if he or she does something that causes you harm or causes a third party to sue you. Indemnification provisions can vary quite a bit. This one strikes a balance. Basically, each party agrees to cover the other’s losses that are caused by her actions. In other words, each party is responsible for the results of her actions. This provision does not specifically limit the value of indemnification to what the other person’s insurance will provide—the other party has to pay regardless of whether that party has insurance coverage for the specific issue.

14. Assignment of Lease

The Landowner may assign this Lease or assign rights and interest under this Lease to agents, employees, and assignees. This Lease is binding on all persons who succeed the Landowner including but not limited to heirs, executors, and purchasers.

Participating Farmer may not assign this Lease or his or her lease interest under this Lease without Landowner’s written consent (43).

• (43) As this provision is written, Landowner may freely assign the Lease—or hand over the rights and obligations under the agreed terms—to another person or business. Landowners oftentimes have this discretion in a lease given so many circumstances may change. For example, Landowner may be forced to sell the land because of financial hardship, or perhaps it becomes too cumbersome to manage. Whomever the Lease is assigned to will be required to follow through with the terms, which protects Participating Farmer. On the other hand, Participating Farmer must get Landowner’s written permission before assigning the lease. This allows Landowner to have some say in whether and who takes over if for whatever reason Participating Farmer wants out.

15. Partnership

This Lease does not create a partnership and neither party has the authority to obligate the other without written consent (44).

• (44) This sounds like legalese, but it’s very important. If the relationship is a partnership, we have detailed tax and liability obligations to deal with. Farmers should make sure this isn’t a partnership in practice either, including keeping key aspects of their business operations separate such as banking and accounting.

16. Dispute Resolution

Prior to taking any action in a court of law, the Parties to this Lease agree to appoint a dispute resolution committee to evaluate the dispute and make recommendations for its resolution. The Dispute Resolution Committee shall consist of three persons: (1) one adult appointed by Participating Farmer who is not a member, partner, director, or employee of Participating Farmer’s business or an immediate family member of Participating Farmer; (2) one adult appointed by Landowner who is not a member, owner, partner, director, or employee of Landowner or an immediate family member of the same; and (3) a neutral individual with expertise in farm-related matters to be agreed upon by both Parties. The Dispute Resolution Committee shall review written submissions and supporting evidence submitted by both Parties within 30 days of the committee’s creation.

The Dispute Resolution Committee shall make findings of fact and propose a resolution for the dispute within 60 days of the Committee’s creation. The Parties may accept the resolution if they wish. If the Parties do not accept the Dispute Resolution Committee’s proposed resolution, the Parties agree and acknowledge that the Dispute Resolution Committee’s findings of fact shall be presumptively valid in a court of law (45). Participating Farmer and Landowner agree to each assume 50% of the costs of the Dispute Resolution Committee, as they are incurred (46). 

• (45) Findings of fact are things like: Participating Farmer did in fact operate the tractor without checking the oil level. Findings of fact are not: Participating Farmer was negligent in the use of the equipment and should pay Landowner $4,000. The latter is called a “finding of law.” If one party didn’t like the Committee’s finding of law, and decided to sue in small claims court, for example, the parties can’t argue that the Committee’s findings of fact as to what actually happened were wrong. Small claims court would then come up with its own findings of law and decide a fair resolution based on the submitted facts.
• (46) This dispute resolution clause is optional. It’s a nice way to resolve the many issues that come up. For example, if we have a tractor repair and we can’t agree on whether it was caused by negligence or regular use, we would use this process to appoint people to review the situation and suggest a resolution. Ideally, the committee is not emotionally invested and will be able to suggest a resolution that works for everyone. If there’s no dispute resolution clause, then the parties are free to sue each other at the get-go if a dispute arises. This can be very costly.

17. Right of Entry

Landowner may enter the Premises at any reasonable time in order to examine the Premises, inspect conditions, conduct repairs, and replace systems.

18. Severability

If any part of this Lease is invalid or unenforceable, the remainder of the Lease shall remain effective.

19. Amendments

Any amendment to this Lease is ineffective unless in writing and signed by both Parties (47).

• (47) This means that any change to this lease needs to be in writing or it’s not enforceable. As the Equipment Manual and the Animal Husbandry Manual are terms of this lease, any changes to the manuals also need to be in writing and agreed to by both parties to the lease. “In writing” is as good as scratching something out and writing on top of the manual. Nothing fancy is needed. Announce when a change has been made to the manual and ask everyone to sign the page as soon as possible. At the close of the year, edit the file, reprint, and start fresh with revisions next year.

 

Signatures

Landowner signature:________________________________________

Incubator Farmer signature:_____________________________________