Landlord Receives Damages after Breach of Pasture Lease

On September 2, 2020, the Iowa Court of Appeals affirmed the award of damages to a landlord for the breach of a pasture lease. The court declined to address the merits of the case because the tenant failed to preserve error.

Background

Under a partnership, two brothers entered into a three-year written lease to rent pastureland owned by the county. The tenant timely paid the yearly rent the following March and entered onto the property for the first time that day. The tenant claimed part of the fence not visible from the road was in disrepair and gates from the corral had been removed. The tenant intended to keep cattle on the property and reported the problem to the county. The county agreed to make the necessary repairs.

In July, the tenant refused to honor the lease because the pastureland could not be used as it intended. The county installed new fencing the next month and accepted bids for a new lease. It eventually accepted a lower rental rate from a replacement tenant. The tenant brought this lawsuit claiming that the two parties had entered into a written contract and the county breached that contract. The county admitted a valid lease existed and counterclaimed for breach of contract.

The district court found the county had not breached the lease, but that the tenant had breached the lease by terminating the agreement early. The court awarded the county damages and ordered the tenant to pay the difference between the total amount the tenant still owed under the lease and the amount paid by the replacement tenant. The tenant appealed.

Error Preservation and Judicial Estoppel

On appeal, the tenant claimed the lease was voidable because there was no meeting of the minds between the two parties and there was a mutual mistake as to the condition of the fence. The court found that the tenant had failed to preserve error because the argument was different than the position set forth in the pleadings and at trial.

Conclusion

This case illustrates the importance of having a clear written lease. Although this lease was in writing, it did not address the key issue regarding the condition of the fence and the obligations of the parties with respect to the fence. Farm leases must include basic information such as the description of the land and the name of the parties, as well as details such as the length of the lease, the amount of rent to be paid, and the date(s) rent must be paid. But they must also include the details of any other obligations imposed upon a party. Setting out the terms clearly in advance can limit misunderstandings between tenants and landlords and reduce the risk of costly litigation.