July 2016

July 2016


Baur Redux: Iowa Court of Appeals Says No Oppression

The Iowa Court of Appeals issued its opinion July 27, 2016, in the seemingly never-ending Baur Farms litigation. The court affirmed the district court’s order, which dismissed the minority shareholder’s lawsuit seeking to dissolve the corporation on grounds of “shareholder oppression.” This case was before the district court on remand after the Iowa Supreme Court issued its key 2013 ruling setting forth the new Iowa standard for minority shareholder oppression in the context of a closely-held corporation:

The determination of whether the conduct of controlling directors and majority shareholders is oppressive under section 490.1430(2)(b) and supports a minority shareholder’s action for dissolution of a corporation must focus on whether the reasonable expectations of the minority shareholder have been frustrated under the circumstances...We hold that majority shareholders act oppressively when, having the corporate financial resources to do so, they fail to satisfy the reasonable expectations of a minority shareholder by paying no return on shareholder equity while declining the minority shareholder’s repeated offers to sell shares for fair value.

Continue reading here.


Iowa Fence Requirements: A Legal Review

This month, we are providing a new overview of Iowa Fence Law designed to provide a comprehensive look at fence requirements applying to landowners and livestock owners. It is available in an easy-to-print or download PDF file.

Iowa fence law has long sought to protect agricultural interests. Iowa fencing statutes date from earliest times, predating the Iowa Code of 1851. Of the current Iowa fence statute, Iowa Code ch. 359A, the Iowa Supreme Court has stated, “It is difficult to imagine a more deeply rooted Iowa statutory provision.”

Iowa landowners have no common law duty to fence their property. Instead, Iowa Code § 359A.1A imposes a conditional statutory duty:

Respective owners of adjoining tracts of land shall upon written request of either owner be compelled to erect and maintain partition fences, or contribute thereto, and keep the same in good repair throughout the year.

Consequently, if one landowners sends a “written request” to an adjoining landowner, asking that a partition fence be erected or maintained, that adjoining landowner must erect, maintain, or contribute to the cost of that fence. It is important to realize that this obligation does not flow from livestock ownership. A landowner owning no livestock can require an adjacent landowner to erect and maintain a partition fence. Likewise, a landowner owning livestock can require his non-livestock-owning neighbor to contribute to erecting and maintaining the partition fence.

Download the full article here.


Mandatory Agricultural Mediation in Iowa

Mediation is a form of alternative dispute resolution designed to draw conflicts to a close without costly and time-consuming litigation. Typically, a neutral third-party mediator works with two sides to a dispute in an attempt to reach an agreement that is acceptable to both parties. If a mediation agreement is signed, the parties are bound by the terms, as they would be bound by any contract.

To protect sometimes vulnerable farming interests, Iowa law has long required mediation for certain types of farm disputes. This fact sheet provides a general overview of Iowa’s requirements for mandatory agricultural mediation.

Since the time of the farm crisis in the mid 1980’s, Iowa law has provided that creditors may not initiate proceedings to enforce a debt respecting “agricultural property” without first attempting to mediate the dispute.

Continue reading here.

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CALT does not provide legal advice. Any information provided on this website is not intended to be a substitute for legal services from a competent professional. CALT's work is supported by fee-based seminars and generous private gifts. Any opinions, findings, conclusions or recommendations expressed in the material contained on this website do not necessarily reflect the views of Iowa State University.

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