In a material the advice is given, what moments should be considered at the conclusion of the lease contract of the earth that further there were no misunderstanding between the tenant and the lessor.
Recently the number of tenants – agricultural enterprises which are interested to lease the land lots for considerable term increases: 10 years, 15 years, and even are more. Especially it concerns rent of the qualitative agricultural holdings which use provides receiving stable profit. Thus interest of such tenants in the conclusion of contracts for long term speaks quite simply: expecting to work at the earth long enough, putting considerable means in earth cultivation, tenants want to be sure of stability of the rent relations with owners of land.
But, as a rule, lease contracts of the land lots on long term (long-term lease) are developed taking into account interests of the tenant. Whether it is expedient to lease the earth for long term? That it is necessary to know and on what to pay attention at the conclusion of such contracts?
1. At first we will emphasize that by the law About a ground lease it is defined conditions which the lease contract of the land lot (important conditions) surely should contain. To such conditions are carried:
– object of rent (it is specified sites and the size (area) of the land lot);
– period of validity of the lease contract (is defined by years, can be determined and months, by a consent of the parties);
– a rent with the indication of its size, indexation, forms of payment, terms, an order of its introduction, revision and responsibility for its failure to pay;
– conditions of use and a designated purpose of the land lot which is transferred in rent; conditions of preservation of a condition of object of rent;
– conditions and terms of transfer of the land lot to the tenant;
– conditions of return of the land lot to the lessor;
– existing restrictions (burdening) concerning use of the land lot; definition of the party which bears risk of casual damage or destruction of object of rent or its part;
– responsibility of the parties for violation of contract provisions.
Absence in the lease contract of the earth of one of important conditions is the basis for refusal in the state registration of the lease contract, and also for contract recognition void according to the law in a judicial order.
In a consent of the parties in the lease contract of the earth other conditions, in particular a qualitative condition of ground grounds, an order of compensation of expenses for implementation of actions for protection and improvement of object of rent, carrying out meliorative works, and also circumstances which can affect change or cancellation of the lease contract and etc. can make a reservation.
Concerning transfer of the earth to a long-term lease, first of all we recommend to read the lease contract attentively. For peasants owners of land – questions of the size of a rent for using their land lots are the most actual. And, as a rule, other contract provisions remain unaddressed the lessor. If the parties coordinated the size of a rent, provisions are not less actual about: indexations of a rent, form of payment of a rent, terms of its payment. Indexation of a rent provides increase in the size of a rent taking into account inflation indexes. Often it is necessary to analyze lease contracts in which it is directly specified that the rent isn’t subject to indexation. Such situation can lead to that years through ten contracts established at the conclusion the rent sum, for example 1,5 %, will already make 0,5 %, and even it is even less. So, for protection of interests of the owner of land (lessor) at the conclusion of the lease contract for long term rent indexation should be the necessary contract provision.
The rent is paid, often, in a natural form, i.e. agricultural production. For the lessor the greatest interest is represented by rent payment by quality products at the smallest prices, for the tenant – on the contrary. Here the most important means of protection of the rights for the lessor is establishment in the contract of quality, the price or an order of definition of the price of production to which the rent will be paid. The concept "market prices" is indistinct therefore in case of a prediscretion in the contract of payment of a rent possibility for the tenant in own way exists production at market prices to treat, what price will be market. As the option of establishment of the price can be offered the following: 1) payment of a rent is carried out by agricultural production (possibly also to specify the concrete list) at the prices which developed in the market at the moment of calculation and confirmed with the reference of regional office of commercial and industrial chamber; or 2) payment of a rent is carried out by agricultural production at the prices which in writing agree treaty parties.
Accurate establishment of term of payment of a rent is necessary in order that the lessor could protect the rights in case of untimely payment of a rent. Accurate establishment of term of payment (for example, till November 15 of every year) or the period (for example, from November 1 to December 31 every year) will be the most successful, in our opinion.
The following important point is the order of transfer of the land lot in rent and conditions of its return. It is necessary to sign after the conclusion of the lease contract the delivery-acceptance certificate of the land lot to the tenant who will be confirmation of real transfer of the land lot under the contract. From the moment of signing of this act the tenant bears responsibility for safety of the land lot. Concerning return conditions, we consider necessary to emphasize on the same order of reception of the land lot the tenant, as well as by transfer, i.e. behind the delivery-acceptance certificate. It is necessary in order that the owner of land of a site upon return of it from a long-term lease could estimate a condition of the land lot, and in case of need demand from the tenant of elimination of deteriorations of the land lot before transfer to it (owner) of the land lot. The indication of is important that the land lot is considered transferred to the lessor from the moment of signing by the delivery-acceptance certificate parties.
The law About a ground lease defined documents which are an integral part of the lease contract. At the conclusion of the contract for long term we persistently would advise, that all these documents were added to the contract and signed by the parties at the moment of signing of the contract. These are the following documents, of them we already mentioned some:
– the plan or the scheme of the land lot which is transferred in rent;
– the cadastral plan of the land lot with display of restrictions (burdenings) in its use and the established land easements;
– the act of delimitation of the land lot in nature (on the district);
– delivery-acceptance certificate of object of rent;
– the project of branch of the land lot in the cases provided by this Law.
– the agreement concerning compensation to the tenant of expenses for the actions directed on protection and improvement of object of rent (if the lease contract of the earth supposes to carry out such actions). Means that in case the tenant has intention to carry out costs of improvement of the land lot, possibility of their compensation, and also compensation order (if the lessor agrees to compensate them), should be coordinated by the parties in writing.
Necessary condition of protection of the rights of the lessor is situation according to which all changes can be brought in the contract only in the consent of the parties stated in the written agreement which is subject to registration, as well as the contract. Therefore it is important, that the contract didn’t contain conditions on which the tenant has the right to change definitely some contract provisions or to carry out them at own discretion.
And, in summary, it is necessary to emphasize that the earth lease contract, irrespective of term on which it is concluded, is subject to obligatory state registration and gains force from the date of its registration. If the contract it is not registered, the owner of land will be considerably limited in possibility to protect the rights, in particular and in receiving a payment for using its land lot. Therefore it is necessary for lessor to check, that the lease contract was properly registered, and one copy of the registered contract surely was stored at the lessor.
(On newspaper materials To Fermerska a hospodariate).