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Agricultural Leases

An agricultural landlord may advance money or property to the tenant for the tenant’s use in producing and storing crops on the leased land.  Animals and tools are among the types of property that a lessor may advance.

The agricultural landlord has a preference lien for rent that becomes due. In addition, the landlord has a preference lien for the money and the  value of property that the landlord has furnished or caused to be furnished to the tenant to grow a crop on the leased premises and to gather, store, and  prepare the crop for marketing. This lien ordinarily attaches to: (1) the property on the leased  premises that the landlord furnishes or causes to be furnished to the tenant to grow a crop on the leased premises; and (2) the crop grown on the leased premises in the year that the rent accrues or the property is furnished. However, if the  landlord provides everything except labor, the lien attaches only to the crop  grown in the year that the property is furnished.

A law exempting property from forced sale does not apply to a statutory agricultural landlord’s lien on agricultural products, animals, or tools. The lien does not attach to the goods of a merchant, trader, or mechanic if the tenant sells and delivers the goods in good faith in the regular course of business.

The statutory agricultural landlord’s lien does not arise if either of the following two situations exists: (1) the tenant provides everything  necessary to cultivate the leased premises and the landlord charges rent of more than one-third of the value of the grain and one-fourth of the  value of  the cotton grown on the premises; or (2) the landlord provides everything except the labor and directly or indirectly charges rent of more than one-half of the value of the grain and cotton grown on the premises.

The statutory agricultural landlord’s lien exists while the property to which it is attached remains on the leased premises and until one month after the day that the property is removed from the premises. If agricultural products to which the lien is attached are placed in a public or bonded  warehouse regulated by state law before the 31st day after the day that they are removed from the leased premises, the lien exists while they remain in the warehouse. If an advance or rent is unpaid, the tenant may not remove or permit the removal of agricultural products or other property to which the lien is attached from the leased premises without the landlord’s consent. If the landlord consents to the removal of agricultural products subject to the lien for preparation for market, the lien continues to exist as if the products had not been removed.

The landlord’s statutory lien is preferred over other liens. The landlord’s rights under the lien are superior to those of a purchaser from the  tenant, regardless of actual notice to the purchaser, since the statute itself is deemed notice to all persons. If a purchaser buys a tenant’s crop or a part  of the crop on which the landlord has a lien without the landlord’s consent or authorization, the purchaser is liable to the landlord for a conversion to the extent of the lesser of the value of the crop converted or the amount of rent due.

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