Before You Agree to a Right of First Refusal on Your Farm
Twice in the last week, I’ve had conversations with farmland owners involving the same issue: a right of first refusal . A right of first refusal can give another person — maybe a tenant, neighbor, or former property owner — the opportunity to purchase your farm before you can sell it to someone else. And while it may seem harmless when everyone is getting along, it can create problems years down the road. One landowner I recently spoke with believed his tenant had a right of first refusal to purchase the farm. After reviewing the situation, we discovered the lease didn’t actually include one. That completely changed how he was able to move forward with the property. Another family owns approximately 200 acres of farmland. Years ago, they sold off the farmhouse and gave the buyer a right of first refusal on all of the surrounding farmland . At the time, everyone probably thought it was a reasonable arrangement. Twenty years later, the relationship has changed dramatically — but that ri...