Pasture Lease

Agdex#:	812
Publication Date:	10/03
Order#:	03-089
Last Reviewed:	10/03
History:	Original Factsheet
Written by:	OMAFRA Staff

Table of Contents

1. Section 1 - Names of Parties and Description of Property
2. Section 2 - Term of Lease
3. Section 3 - General Terms of Lease
4. Section 4 - Rental Calculations and Payment Schedule
5. Section 5 - Tenants and Landlords Duties in Operating the Pasture
6. Section 6 - Production Practices and Management Decisions
7. Section 7 - Resolving Difference and First Rights of Refusal
8. Section 8 - Additional Agreements
   

This lease is a guide for landlords and tenants to develop an agreement to fit their individual situation. This form is not intended to take the place of legal advice pertaining to contractual relationships between the two parties.

To use this form: Complete two identical copies - one for the landlord and one for the tenant. Cross out any provisions not part of the agreement and have both the landlord and tenant initial these. Add any additional provisions desired. Use ink or a typewriter. Suggestions for completing and using this lease form can be found in the OMAFRA Factsheets Land Lease Arrangements, Order No. 01-065 and Pasture Lease Agreements, Order No. 03-091, Lease Agreements for Pastures.

Section 1 - Names of Parties and Description of Property

1. Names and Addresses of the Tenant and Landlord

This lease is entered into on ________________________________________________________, 20______,

Between

__________________________________________________________________,
Landlord,
of (address)______________________________________________________________________, Ontario

and __________________________________________________________________,

spouse of Landlord

and
__________________________________________________________________,
Tenant,
of (address)__________________________________ ___________________________________,

Ontario

and ____________________________________________________________________________,

spouse of Tenant.

2. Description of Property to be Leased

The Landlord rents and leases to the Tenant, to occupy and to use for agricultural purposes only, the following real estate located in the Township of or former Township of _____________________________, in the County, District or Region of _________________________ in the Province of Ontario, legally described as Lot ________, Concession ________, commonly known as the _____________________________farm and consisting of approximately _________ acres, hereafter called the leased premises.

Section 2 - Term of Lease

The Term of the Lease

Instructional Note: A lease of this nature cannot extend beyond a term of 21 years; it is suggested that the maximum term of the lease for paragraph (a) below be 20 years.

Only use one of the clauses below. If a continuing lease is desired, use paragraph (a) and strike out (b). If a definite term is desired, use paragraph (b) and strike out paragraph (a). No notice of termination is necessary if paragraph (b) is used.

1. Continuing Lease - The term of this lease agreementshall be _______ year(s) commencing on _____________ , 20_____, and shall continue in effect from year to year thereafter (as an annual lease) unless written notice of termination is given by either party to the other at least _________ days prior to expiration of this lease or the end of any year of continuation.
2. Annual Lease - The term of this lease shall be _________ year(s), commencing on the ___________________, 20_____, and ending on __________________, 20_____. If the Tenant wishes to renew this lease the Tenant must notify the Landlord in writing not less than sixty (60) days prior to the expiry date of the lease of the Tenant's desire to renew. If such a notice is delivered, then the Landlord and Tenant shall seek agreement on the terms of such renewal which must be agreed to within thirty (30) days prior to the expiry of the then current term of the lease failing which this lease shall terminate on the date set for expiration and the Tenant shall give up possession of the leased premises.

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Section 3 - General Terms of Lease

1. General Clause

Right to Sublet or Assign - The Tenant shall have the right to sublet or assign this lease provided the Tenant obtains the written consent of the Landlord, which consent shall not be unreasonably withheld.

Amendments and Alterations - Amendments and alterations to this lease shall be in writing and shall be signed by both the Landlord and Tenant.

No Partnership Intended - It is particularly understood and agreed that this lease shall not be deemed to be nor intended to give rise to a partnership relation.

Binding on Heirs - This Lease shall be binding upon the Landlord and Tenant and their respective personal representatives, trustees, successors and assigns.

Landlord Liability - The Tenant takes possession of the leased premises subject to the hazards of operating a farm, and assumes all risk of accidents personally as well as for family, employees, or agents in pursuance of farming operations, or in performing repairs on buildings, fences, tile, and other improvements except for any liability arising out of the gross negligence of the Landlord.

2. Right of Inspection and Removal of Livestock

Landlord's Right to Enter Property - The Landlord reserves the right personally or by agents, employees, or assigns to enter upon the leased premises at any reasonable time to view them, to work or make repairs or improvements thereon, to care for and dispose of the Landlord's share of livestock, to develop mineral resources or, after constructive notice has been given that the lease may not be extended, and following removal of livestock, to plow and prepare a seed bed, make seedings, apply fertilizers, and any other operation necessary to good farming by the succeeding operator, these operations not to interfere with the Tenant's in carrying out the regular farming operations.

Quiet Possession - The Landlord gives the Tenant quiet possession of the leased premises in accordance with section 13 of Schedule B to the Short Forms of Leases Act, RSO 1990, c. s.11.

Tenant's Right-of-Way - The Landlord agrees to give quiet possession of the leased premises. The Landlord shall give to the Tenant a right-of-way over lands owned by the Landlord which abut the leased premises for the purpose of allowing the Tenant to pasture and care for the livestock on the leased premises if such a right-of-way is necessary and such right-of-way shall cease upon the termination of this lease.

Tenant's Compensation on Termination of Lease - The Landlord agrees to reimburse the Tenant at the termination of this lease for field work done on leased pasture or for other crop costs incurred for crops to be harvested during the following year. Unless otherwise agreed, current custom rates for the operations involved will be used as a basis of settlement.

3. Transfer of Property (Strike out unwanted clause)

Sale of Property Recognizes the Lease - If the Landlord should sell or otherwise transfer title to the leased premises, the Landlord shall do so subject to the provisions of this lease.

Or

Lease Terminated on the Sale of the Property - In case the Landlord should desire to sell the leased premises and premises during the term of the lease, the lease may be terminated at any time by giving ______ days notice to the Tenant. The Tenant shall, at the expiration of the notice period, peaceably and quietly give up possession of the leased premises to the Landlord. The Landlord shall, after the Tenant has delivered up possession in manner aforesaid, and paid to the Landlord the full proportion of rent up to the beginning of the notice period will compensate the Tenant for field work operations done on the leased pasture or of the field work done on the leased premises in preparing for a crop, the amount of such compensation to be determined by arbitration if the parties cannot agree thereon.

4. Termination of Lease

Grounds for Termination of Lease - If either party fails to carry out substantially the terms of this lease in due and proper time, the lease may be terminated by the other party by serving a written notice citing the instance(s) of default and specifying a termination date of ________ days from the date of such notice. Settlement shall then be made in accordance with the provisions under the Right of Inspection and Removal of Livestock section of this lease and any amendments to this lease.

Section 4 - Rental Calculations and Payment Schedule

(Use method 1, 2 or 3 and strike out the 2 methods not used)

Method 1

The annual cash rent shall be $_______________ dollars per acre of pasture land for a total of $ __________ dollars. GST will be added to the rental amounts when applicable.

The rent shall be payable as follows:

$_________________________ on or before the ________ day of ____________________, 20______. $_________________________ on or before the ________ day of ____________________, 20______. $_________________________ on or before the ________ day of ____________________, 20______. If rent is not paid when due, the Tenant agrees to pay interest on the amount of unpaid rent at the rate of ________ percent per annum from the due date until paid.

Method 2

The livestock owner agrees to pay the following rates: (The period may be by the month, pasture season or year.)

The minimum rent shall be $ ________________. Such rental shall be required regardless of whether or not livestock are actually being pastured. The Total Rent of $ ________________ shall be as follows:

The rent shall be payable as follows:

$_________________________ on or before the ________ day of ____________________, 20______. $_________________________ on or before the ________ day of ____________________, 20______. $_________________________ on or before the ________ day of ____________________, 20______.

If rent is not paid when due, the Tenant agrees to pay interest on the amount of unpaid rent at the rate of ________ percent per annum from the due date until paid.

Rental adjustment - Additional agreements in regard to rental payment: i.e. premature withdrawal due to effects on pasture condition of excessive moisture or drought.

Method 3

Other Rental Arrangements (share of gain, etc.)

___________________________________________

The rent shall be payable as follows:

$_________________________ on or before the ________ day of ____________________, 20______.

$_________________________ on or before the ________ day of ____________________, 20______.

$_________________________ on or before the ________ day of ____________________, 20______.

If rent is not paid when due, the Tenant agrees to pay interest on the amount of unpaid rent at the rate of ________ percent per annum from the due date until paid.

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Section 5 - Tenants and Landlords Duties in Operating the PastureG THE PASTURE

The livestock owner agrees:

1. Not to pasture livestock that continue to break through fences. Should any animal be found outside the pasture on at least _____occasions, the pasture owner may request its removal.
2. Not to put any cattle on pasture without getting specific approval from the pasture owner in advance regarding number, health, sex, breed, and age.
3. Agrees to furnish health certificates as follows: _______________________________________

2. The landlord agrees:

1. Not to place male animals of breeding age in adjacent pastures.

3. Tenant and Landlord Responsibilities

Additional responsibilities for each party shall be divided as follows: (Check column where appropriate).

	Landlord	Tenant
Supervise supply of water to livestock
Furnish labour for repair of water system
Materials for repair of water system
Furnish salt
Furnish mineral
Furnish Implants
Count livestock at least once per ______
Provide I.D. tags
Return stray animals to pasture
Call veterinarian in case of emergency
Pay veterinary expenses
Furnish supplementary feed, if needed
Notify other party of shortage in count
Provide facilities for fly control
Keep fly control facilities in working order
Liability insurance
Provide loading chute
Maintain loading chute
Provide headgate
Maintain headgate

Fences	Interior	Exterior	Landlord	Tenant
Inspect fences at least once per _________
Furnish labour for repair of fences
Furnish materials for repair of fences
Provide corral
Provide fences
Provide supply of power for electric fence
Supervise supply of power for electric fence

4. Compensation for Repairs to Buildings, Fences, and Improvements

Tenant Responsible for Normal Repairs - The Tenant shall not make major improvements, other than what is considered normal repair and maintenance, to the leased land or any other assets identified in this agreement without written permission of the Landlord.

The Tenant shall leave the leased premises in good repair in accordance with section 9 of Schedule B to the Short Forms of Leases Act, RSO 1990, c. S.11.

Landlord Responsible for Major Improvements - Major improvements, which without restricting the generality of the term, shall include: water development, erosion control, fencing and building construction, clearing, breaking, and seeding to pasture and hayland. Such consent shall be attached to and form part of the lease agreement. The amount of compensation shall be an amount agreed upon by the Landlord and Tenant. Title to all improvements shall vest in the Landlord and no improvements shall be sold, removed, disposed of or encumbered without the written consent of the Landlord.Responsibility for Major Improvements - The Tenant shall not make major improvements to the leased premises without written permission from the Landlord. Such permission shall be attached to and form part of the lease. The amount of compensation payable to the Tenant by the Landlord for a major improvement shall be agreed upon by the Landlord and the Tenant and if they can't agree the dispute shall be resolved by arbitration in accordance with paragraph 7-1. Title to such improvements shall vest in the Landlord upon completion and no improvement shall be sold, bartered encumbered, disposed of or removed from the leased premises without the permission of the Landlord. For the purposes of this provision and without limiting the generality of the term, "major improvement" shall include water development, erosion control, fencing, construction of buildings, clearing, breaking and seeding of land to pasture and hayland.

Additional agreements: Fertilizer, weed control, etc.
_____________________________________________________

_____________________________________________________

_____________________________________________________

_____________________________________________________

5. The Use Of The Land

The Tenant further agrees to perform and carry out the stipulations below. (Strike out any not desired.)

(a) Activities Required

Compensation to Landlord for Damages - The Tenant agrees when he leaves the leased premises, to pay the Landlord reasonable compensation for any damages to the leased premises for which he, the Tenant, is responsible.

(b) Activities Restricted

The Tenant further agrees, unless the written consent of the Landlord has been obtained:

No Alterations - Not to remove, alter or change the style or position of any building or fence on the said leased premises

No Other Activities - Not to permit, encourage, or invite other persons to use any part or all of this property the leased premises for any purpose or activity not directly related to its use for agricultural production.

No Cutting of Trees - Not to cut live or dead trees for the purpose of sale or personal uses.

No Signage - Not to erect or permit to be erected any commercial advertising signs on the leased premises.

No Mineral Rights - Nothing in this lease shall confer upon the Tenant any right to minerals underlying the land. Such mineral rights are hereby reserved by the Landlord together with the full right to enter upon the premises and to bore, search, excavate, work, and remove the minerals, to deposit excavated rubbish, to pass over the premises with vehicles, and to lay down and work any railroad track or tracks, tanks, pipelines, powerlines, and structures as may be necessary or convenient for the above purpose. The Landlord agrees to reimburse the Tenant for any actual damage the Tenant may suffer for crops destroyed by these activities and to release the Tenant from obligation to continue farming the leased premisesis property when development of mineral resources interferes materially with the Tenant's opportunity to make a satisfactory return.

6. Environmental Matters

The parties hereto hereby acknowledge that the Tenant intends to use the leased premises described in this lease for agricultural purposes and that such use of the leased premisesand may have an environmental impact; accordingly, the parties agree as follows:

Use of Normal Farm Practices - The Tenant shall conduct its operations on the leased premises in accordance with normal farm practices including, but not limited to, the application of fertilizers, pesticides and herbicides and shall only engage licensed applicators of such substances or shall ensure that the Tenant is appropriately licensed for such applications.

Manure and Nutrients - To haul and spread manure only on appropriate fields at times and in quantities consistent with sound manure management practices and in accordance with the guidelines and regulations of the Nutrient Management Act 2001. Where a Nutrient Management Plan (NMP) is in place the Tenant shall apply manure and other nutrients in accordance to the rates, manner and separation distances from neighbours, wells and watercourses and any other guideline as stated in the nutrient management plan. The Tenant shall also keep a record of nutrient applications and will produce them at the request of the Landlord. The Tenant shall also notify the Landlord in writing if the Tenant is submitting nutrient information to a municipal or region government as part of an official nutrient management tracking system.

Municipal Sludge - The Tenant shall not, without the written consent of the Landlord, apply or give permission to have applied, any municipal waste or sludge on the leased premises. Where the Landlord has granted permission, any municipal sludge or waste shall be applied in accordance to the Nutrient Management Act 2001.

Use of Normal Farm Practices - The Tenant shall conduct its operations on the leased premises in accordance with all applicable laws and regulations and in accordance with normal farm practices including, but not limited to, the application of fertilizers, pesticides and herbicides and shall only engage licensed applicators of such substances or shall ensure that the Tenant is appropriately licensed for such applications.

Nutrient Management Strategies and Plans - The Tenant shall not, without written consent of the Landlord, allow this land to be incorporated into a nutrient management plan or strategy, of a person other than the Tenant, that is required under the Nutrient Management Act 2002 or municipal by-law. If there is a nutrient management plan or strategy for the leased premises, then the Tenant shall store and manage all manure, nutrients, biosolids or other materials prescribed by the Nutrient Management Act 2002 or municipal by-law, in accordance to that plan or strategy and maintain records in accordance with the applicable law.

Manure - The Tenant will ensure that all manure and other material containing nutrients and any other material applied to the land is applied in accordance with all applicable laws. The Tenant will not allow, without the written permission of the Landlord, any manure or other by-products, other than those produced by the agricultural operation of the Tenant, to be applied to the land.

Farm Waste - All containers (e.g. pesticide and oil containers) and other waste of farm operations, with the exception of crop residue and manure, will be removed from the leased premises and disposed of in accordance to all applicable laws.

Sewage Biosolids or Pulp and Paper Biosolids - The Tenant shall not, without the written consent from the Landlord, apply or give permission to have applied, any municipal waste or sludge on the leased premises. Where the Landlord has granted permission, any municipal sludge or waste shall be applied in accordance to the Environmental Protection Act (Ontario) and Nutrient Management Act 2002 as they apply.

Chemical Spills - The Tenant shall immediately report any spill or misuse of chemicals to the Landlord and to comply generally with all environmental laws including the provisions of the Environmental Protection Act (Ontario) including the requirement to attend to the immediate clean-up of any such spill at the sole cost of the Tenant.

Chemical Storage - The Tenant shall insure that no chemicals will be stored on the leased premisesproperty for longer than is required for the current years application or use and in no greater amounts than areis required for the leased premisesland. The Tenant shall ensure that such chemicalsthey are stored in a secure dry location away from all wells and watercourses in closed, tight containers above ground and clearly marked. No chemicals or chemical containers will be disposed of on the leased premisesproperty.

Noise - The Tenant shall ensure that no undue noise or other nuisance emanates from the leased premises or from the operations of the Tenant on the leased premises.

Spill Insurance - The Tenant shall be required to obtain and maintain during the currency of this lease adequate policies of insurance, the content and policy limits thereof to be satisfactory to the Landlord acting reasonably, naming the Landlord as an additional insured party for the risks attendant with any environmental matter including, but not limited to, the improper disposal of wastes or the application or misapplication of toxic substances. In setting the policy limits the Landlord shall act reasonably having regard to the potential risks associated with such a spill.

Landlord Not Responsible for Costs - For separate consideration, the Tenant hereby agrees to indemnify and save harmless the Landlord from any costs incurred by the Landlord arising directly or indirectly from anythe breach by the Tenant of this provision.

Tenant Must Carry Insurance - For the term of the lease, the Tenant shall maintain insurance, insuring the Tenant while performing on the leased se premises. The Tenant shall furnish a Certificate of Insurance at the Landlord's request and agrees that all applicable insurance policies shall name the Landlord as an additional insured and require the insurer to giveto receive notice of termination of coverage to the Landlord.

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Section 6 - Production Practices and Management Decisions

Production Practices and Management Decisions (choose one under each heading)

Pesticides - The Tenant and Landlord will jointly make all decisions with respect to which pesticides can be used on the land.

Or

The Tenant is prohibited from using the following pesticides, unless mutually agreed upon:

List Pesticides:

__________________________________

__________________________________

__________________________________

Section 7 - Resolving Difference and First Rights of Refusal

1. Resolving Differences

Disagreements Will Be Submitted to an Arbitrator(s) - Any differences between the parties as to their several rights or obligations under this lease and to the affairs of the leased premises that are not settled by mutual agreement after thorough discussion, shall be referred to the arbitration of a single arbitrator, if the parties hereto agree upon one; otherwise to three arbitrators, one to be appointed by each party and a third to be chosen by the first two named before they enter upon the business of arbitration. The award and determination of such arbitrator or arbitrators, or any two of such three arbitrators, shall be binding upon the parties hereto and their respective heirs, executors, administrators and assigns.

2. Compensation for Crop and Property Damages, Oil and Gas, Utilities, Roads, and Rights-of-Way

Compensation Paid to Party who Suffers the Loss - Compensation for reasons such as, but not limited to, property damage and inconvenience from oil and gas exploration, pipeline development, power and telephone line installations, or road construction, shall accrue to the party that has suffered the loss. The Landlord will have the final say on who has suffered the loss except as follows:

1. Crop Damage - where the compensation is for crop damage, the loss shall be deemed to be compensation will be paid to the Landlords.
2. Work Completed by Tenant - where the compensation is for work completed by the Tenant such as, but not limited to, fence re-construction, grass reseeding or topsoil leveling, the compensation will be paid to the Tenant.
3. Compensation for Nuisance - where the compensation is for the creation of a nuisance situation such as, but not limited to, gates being left open, dust or noise, the compensation will be paid to the Landlord.
4. Land Damage or Loss - where the compensation is for a decrease in the land's value such as, but not limited to, loss of acres from the development, severing a parcel of land or topsoil disturbance, the payment shall be made to the Landlord.

Or

Compensation for reasons such as, but not limited to, property damage and inconvenience from oil and gas exploration, pipeline development, power and telephone line installations, or road construction, shall be paidaccrue to the Landlord.

Or

Compensation for reasons such as, but not limited to, property damage and inconvenience from oil and gas exploration, pipeline development, power and telephone line installations or road construction, shall be determined by mutual agreement between the Landlord and Tenant. If mutual agreement cannot be reached, it shall be submitted to arbitration.

3. Rights of First Refusal

In the event that the Landlord receives a bona fide offer to purchase the leased premises which the Landlord is willing to accept, then the Landlord shall provide a copy of such offer to purchase to the Tenant within 48 hours of the receipt of such offer at which time the Tenant shall have a period of a further 48 hours to confirm to the Landlord that the Tenant wishes to purchase the leased premises upon the same terms and conditions as set out in the offer to purchase failing which the Landlord shall be at liberty to sell the leased premises pursuant to the offer to purchase.

Section 8 - Additional Agreements

____________________________________________________

____________________________________________________

____________________________________________________

____________________________________________________

__________________________
(Landlord)

__________________________
(Spouse of Landlord)

__________________________
(Tenant)

__________________________
(Spouse of Tenant)

__________________________
(Witness)

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