Termination and Default
Can a tenant terminate before the end date of the lease?
Yes, a tenant can terminate before the end of the lease, but depending on how the lease is written, s/he may be liable for the remaining rent. A lease may permit the tenant to terminate at any time with notice. If the landowner defaults, as defined in the lease, this may constitute grounds for early termination without penalty to the tenant. See fact sheet “Termination…”.
Can a landowner terminate before the end date of the lease?
It depends. If a tenant defaults and does not “cure” the default, as defined in the lease, this may constitute grounds for early termination. Additionally, some leases include language permitting either party to terminate before the end of the term as long as they provide written notice before terminating. Note, however, that if the lease is for five years, but the landlord can give a six-month notice of termination, then in effect, the tenant has six months’ security. If a landowner terminates early, s/he may owe the tenant the value of their unharvested crops, at a minimum. See our fact sheet “Termination …”.
What happens if a farmer-tenant has crops in the ground when his/her lease terminates?
In a farmland lease arrangement, annual crops produced by a tenant legally belong to the tenant. How this issue is addressed depends on the type of crop, the language in the lease, and other factors. The best approach is to include a lease provision allowing a tenant to come back on the leased property to harvest crops after the lease has terminated. In some jurisdictions, if a lease does not address the issue, the “doctrine of emblements” may apply. In some states the common law “doctrine of emblements” guarantees the farmer’s right to harvest and carry away his or her crops (“emblements”), even if the crop matures after a lease terminates.
What does “default” and “cure the default” mean?
A “default” is a failure to comply with a provision in the lease. “Curing” or “remedying” the default means correcting the failure or omission. A common example is a failure to pay the rent on time. Failing to meet any of the requirements in a lease can legally constitute default, e.g., not showing evidence of insurance, removing trees if prohibited by the lease, not repairing a structure. A landlord can also default by not performing certain responsibilities. Typically a lease will give the parties adequate notice and time to fix the problem before more drastic action is taken.
What are a tenant’s obligations if his/her lease is terminated due to tenant default?
If a lease is terminated due to the tenant’s default, the tenant’s obligations depend on the terms of the lease. The tenant could be required to pay the rent for the full (or remaining) lease term as damages. Typically all provisions in the lease pertaining to termination would also apply.