Agr Farm Lease(~. L. CL.ARK
.JAI~S F'. MIZ~
ALI~REY G. LINVIL. L~
~. DOUGLA~ MILLER
I..A. HC NALLEY
July 25, 1973
CLARK, I~IZE, LINVILLE ~ MILLER
CHAi=F'r"Ir RE D
LAW Olrlrl CES
~OU"I"H EIGHTH- BOX 134.3
SALINA~ KAN.~s.S ~7401
Mr. Norris Olson
City Manager
City - County Building
300 West Ash
Salina, Kansas 67401
Re: Lease of Hocking Farms, Inc.,
on former Airport Authority land
Dear Mr. Olson:
The subject lease contains the following provision:
"(6). Termination of Lease: The Authority reserves theright to
terminate this lease as to any portion of the Premises in the event
said Premises or any portion thereof are needed for industrial purposes
or for the use of the Authority or any other political subdivision. In
the event the Authority desires to terminate said lease as to any portion
of the Premises, then the Authority shall give the Lessee sixty days
written notice of its intention to do so and shall describe the portion
of the Premises affected thereby. In the event said lease is cancelled
as to a portion of said Premises, then the Authority agrees to reimburse
Lessee for any growing crops on Premises for which the lease is cancelled
and the cash rent for said year and the remainder of lease period shall
be proportionately reduced."
Hocking Farms, Inc., claims the lease, a copy of which is annexed, is valid
and subsisting. Neither the Board of Commissioners of the City nor the
Airport Authority authorized or directed the termination of the lease nor
has either, in conformance with the terms of the paragraph, aforesaid, pur-
suant to the lease and the existi~facts, selected by notice to Hocking
Farms, Inc., the portion of the described property to be subjected to bona
fide public use.
It is Hocking Farms, Inc., contentions that:
(i) The City, without any constituted authority complying with the
terms of the lease and in contravention thereof, is trespassing upon the
Mr. Norris Olson
Re: Hocking Farms - Airport'Authority Lease
July 25, 1973
Page Two
leasehold of Hocking Farms, Inc.; (ii) the only portion of the property
covered by the lease, that can be removed therefrom, is that portion to be
subjected directly to an actual bona fide governmental use after specific
bona fide notice of the selection for such use as provided in the lease and
an ensuing actual subjection of the selected portion to governmental use;
(iii) that an appropriate adjustment in rental under the lease directly flows
from the removal of parts of the property from the lease for such use; and
(iv) the City is going to subject only a very small portion of the poroperty
to governmental use within the term of the lease.
Hocking Farms, Inc., additionally claims as an offset against future rentals
payable under the lease all damages suffered by it as a consequence of the
Airport Authority failing to provide Hocking Farms, Inc., possession of 110
acres for use for the planting of wheat for 1973 harvesting. At the time of
the execution of the lease, June 13, 1972, there were 110 acres of growing
wheatland which Hocking Farms was to have farmed immediately after the wheat
was harvested thereon. Larry Bengtson is familar with the claims of Hocking
Farms, Inc., in this regard. It is to be observed that as a consequence of
this default by the Authority that Hocking Farms, Inc., would have land avail-
able for only four wheat crops, although it is liable for five years' rent.
Hocking Farms, Inc., is in lawful possession of the property covered by the
lease and, subject only to the bona'fide removal of portions of the property
from the lease under the aforesaid paragraph in a reasonable and proper manner
pursuant thereto, it is going to maintain and continue to claim the total
right of possession for the term of the annexed lease until such time, if
ever, that a court of competent jurisdiction by a final judgment terminates
the company's right to possession of all or some portion of the property.
When Allan J. Hocking, President of Hocking Farms~ Inc., met with you and
Larry, you stated that the City considered the lease terminated except for
planting land to wheat for this coming year and you were going to submit the
land, or a part thereof, for rent to the public for agricultural purposes.
As you are no doubt aware, Hockin~Farms, Inc., was in possession of the
property covered by the lease when the City acquired the property. So far
as Hocking Farms, Inc., is concerned, the lease was then and is now~valid
and subsisting. The notice purportedly terminating the lease is in contra-
vention of the specific terms of the lease, and the then existing and now
existent facts, and we consider that purported notice of termination is a
nullity.
Mr. Norris Olson
Re: Hocking Farms - Airport Authority Lease
July 25, 19 73
Page Three
Based on the best available information, the City will not within the terms
of the lease have a bona fide need for over twenty (20) acres for govern-~
mental use. A governmental authority provided the form o~ the lease, it
will, therefore, be strictly construed against the government. We believe
that it is a very strained construction ~or the City to claim a government
"use" of any portion of the property which, as you and Larry stated, it in-
tends to lease for agricultural purposes.
We believe Hocking Farms, Inc., has a valid enforceable right ~mder the lease.
Hence, it elects to stand upon and claim the right.
As a matter of compromise and without prejudice to the rights of Hocking
Farms, Inc., careful consideration will be given to negotiating a valid
lease on such of the property as is available for farming operations from
time to.time. A proper share crop rental and a variable rental on the grass
based on the price of beef will be considered.
.Since~e~ yours,
.., i MILLER, CHARTERED
C~C/11
Enclosure
cc: Mr. L. O. Bengtson
LEASE .......
This Lease Agreement, made and entered into this _13th day
~z~'~,~ AI AUTHORITY of Saline,
of .Jun=-, 1972, by and between o-r~,'- N. POP. T-
Author~ =y
Salin=_ County, Kansas, hereinafter referred to as the "' ~= "
and HOCKING FAPd-~S, iNC., a Kansas corporation with principal offices
and place of business in Saline County, KAnsas, hereinafter referred
to as the "Lessee", WITNESSETH:
That 'the Authority in consideration of the rents, covenants,
agreements and Conditions hereinafter stipUlated to be paid and
performed by the Lessee, does hereby let and lease unto said
Lessee the following described premises, to wit:
Section Seven (7), Township Fifteen (15) South, Range
Three (3) West of the Sixth Principal Meridian in
Saline County, Kansas (except area used for water
storage tank by City of Sa!ina),
together with the appurtenances thereunto belonging hereinafter
referred to as the Prem_ses :
(1). Term of Lease: To have and to hold the same for and
during the term contmencing on the !st day of August, 1972 and
terminating on the 31st day of July, 1977, inc!usive., .subject
however, to the qualifications hereinafter provided.
(2). Rental': Lessee agrees to pay the Authority as rental~
Th.r=y Thousand Five Hundred and
for said Premises the sum of ~ ~
Ninety Dollars ($30,590.00) which shall be paid in five (5) equal
annual installments of Six Thousand One Hundred and Eighteen
Dollars ($6,11~.00) which annual rental shall be payable as
follows:
$1,000.00 on August 1st of/each year and $5,118.00
on November 1st of each year.
(3). Use of Premises: Lessee agrees to use the Premises
for grazing and agricultural purposes only as hereafter specified.
(a). Pasture Land: That portion of the Premises
which is now in native grass may not be cultivated and
if used for grazing purposes, the sam=- must he enclosed
by a four strand barb wire fence constructed in a good
and workmanlike manner at ~he ,~xm~nse of the Lessee
?-..ny fanc-_$ constructed shall become_ a part of tke
Pr~mises and may not be removed by L~ss~ upon tar-
ruination of said lease. All fences now on the
Premises shall be kept in a good sta~e of repair by
Lesse=. Lessee si~all graze the pasture land in
accordanc~ with the ~ ~='
a~ep~_~ principles of good
pasture management.
(b). Cultivated Land: Lessee agrees to farm
said-land in due season and in a n~,~,~=~
~ ....... and workman-
like manner and not to allo~.z ;,;asta upon said Premis~s
by virtue of failure to properly protect said land
from wind or water erosion.
(c) . Government Agricultural Programs: Authority
- - aD~.d~ng
by all terms and conditions of any governmental agri-
cultural programs which are now in effect or may ~=
applicable during the terms of this ~===-
..... =; that the
Lessee shall be entitled to receive any and all subsi-
dies or government payments which the Authority ~ ~
be entitled to as the owner of said Pr=_mises. ''
(4). Possession: Lessee skal! be entitled to posse:~sion on
August 1, 1972 of all ground now und. er cultivation and upon ~.,;hich
there are no growing crops. Cu!t~va~_~ land upon whicl~ p~esent
tenant has growing crops shall be given as .soon as the 19'72 crop
growing thereon has been harvested by the present tenant (excludes
right of present tenant to harvest crops by grazing), however in
no event later than December 1, 1972. Possession of that portion
of Premises in native grass and' used for grazing purposes %~ill be
given on Nover~er 1, 1972.
Parties agree +hat upon termination of tn~s lease in the year
1977, that Lessee %~ill surrender possession of said Premises to
the Authority at the following tides: (1) All land planted to
wheat as soon as 1977 crop has. been harvested; (2) Pasture land
(native grass) on or before November 1, 1977; (3) All cultivated
land upon %.;hich no crops are growing on or before ~Lgust 1, 1977,
and (4) All land planted to other crops as soon as crop has been
harvested (excludes harvesting by grazing) but J.n no event later
than December 1, 1977.
(5) EasA.m~_nt: Authority retains the right to enter upon
n_c ..=sar:
said Premises to perform any and all' ~ =~- ~, maintenance in
connection with its utility lines (~..~ater, sewerage, gas) located
thereon; also to remove, replace, salvage or modify such existing
utility lines and appurtenances as the Authority shall designate.
(6). 'Termination of Lease: 'The Authority reserves the
riqht to terminate this lease as to any portion of the Premises
in the event said Premises or any portion thereof are needed for
industrial purposes or for the use of the Authority or any or/ear
political subdivision, in t.~e event the Authority desires to
terminate said 'lease as to any portion of the Premises, ' ~-~
Authorlty shall give the Lessee sixty days written notice of ~
~'-= the portion of the ~ ~ ~ ==
intention to do so and shall descr=~-
affected thereby. In the event said lease is cancelled as .to a
portion of said ~ = ~= ~, then +h= Authority agrees to reim/~urse
Lessee for any growing crops on Premi == for w.~nh the lease is
cancelled and the cash rent for said year and th~ remainder of
lease period shall be proportionately reduced.
(7) Liability Insurance: Lessee agrees to secure 'and main-
rain public liability insurance to protect the Authority and it-
. ~- ~ ~ njurv
self against any lzability which may arise as a r~ul~ ,Df _ ~
or accident on or about the Premises. Said policy shall be.
written by a reliable insurance company authorized to do business
within the State of Kansas in the amount of $100,000.00 in casa
of injury or damage to one person and $300,000.00 in case of
injury or damage to more than one person in the same accident
or occurrence and $100,000.00 ~r property damage. Lessee shall
deliver to the Authority a certificate of such insurance on re-
quest.
(8). Ownership of Fixtures: It is understood and agreed by
'and between the parties hereto that any additions, improvements
or fixtures attached to the Premises. or placed on or about said
~__ shall be considered as personal property and
Premises by Leso~ -
shall remain the property of Lessee who shall have the right to
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remove the s~e from the Premises upo, n th~ expiration of this
lease so long as such removal does not ir~,Dair t~%~ struct~ural
feature of the improvements presently on the leased Premises.
Provided, hot, ever, in ~'-~ ~n_.s l~ase
~ne event of termination· of ~] :
due to a breach of covenant by the Lessee, then all fixtures
an,-] improvements shall become the propar~y of the Autl!ority and
may not be removed from the Premises.
(9). Waiver: Waiver by th~ Authority. of any breach of this
lease shall not be construed as a continuing %,~aivar of a subse-
quent breach nor imply further indulgence.
· ev~n~ said Lessee shall fail
(10) Breach of Lease: In the = ~
to comply ·w_tn any substantial term, condition or covenant of
this lease %;ithin ten days after written notice so to do has been
mailed to it by said Authority, or in the event said Lsssee aban-
dons said Premises before the end of the term, or in the event
.said Lessee is adjudged bankrupt or inso!vant or makes an assign-
ment for the benefit of creditors or com~its any act of baPi<ruptcy,
any of such events shall be deemed an immediate breach and for-
feitura of this lease and all unpaid installments of' rent and
other expenses herein provided for shall ir~ediate!y become due
and payable.
(11). Utilities: Lessee ~hall at its o%~.~n expense obtain
and pay for all electricity, water, gas, se~'er use fees., or other
utilities used by it during the term of this lease or any exten-
sions thereof, including the cost of maintenance and ope. ration of
the heating system for the. Premises.
(12). Liens: Lessee shall pay, satisfy and discharqe all
liens and obligations of any nature and kind ~,~hatsoever created
by or the obligations of the Lessee which shall attack to or ba
/
imposed upon said Premises and shall indem~nify, save and[ ?.~old
harmless said Authority from such payment and from all daraages
and ex.~enses attendant thereto.
(13). Assignment of Leas%: Lessee shall not assign this
lease or any interest therein and shall not sukl~t the Premises
-4-
or any part thereo~, or allow any p=rson to occupy or ~s~a said
Premises or any por=~on =[~ou. ~ .... con-
sent of the Authority. 7: consent to one assignment.or subletting
for use by any other p%rscn s~.~a!l not be deem. ed to a consent to
any subsequ~n~ assignm'ent
(14). Inspection of Premises: Lessee agrees that tile Auth-
ori'ty, or its agents, may at all reasonable times have free access
uner._on -
to said demised Premises and buildings
examining or inspecting the condition of the same or exercising
any right or po,,~er reserved to the Authority under the terms and
provisions of this agreement.
(15). t~otices: All notices to be given oursuant to
lease shall be addressed to the Salina Airport Authority, Salina,
~'~-_e_ at Salina, Kansas, 67401, 'or as
Kansas, 67401, and to ~ ._ Le==
may from time to time be directed by the parties, Noti¢:e shall-
be deemed to have been duly given if and %..~hen enclosed ~._n a prop-
erly sealed envelope or %,;rapper addressed as aforesaid and mailed
p~ _pa_d
by reo. istered or certified mail with postace ~= ~ ·
(16) . General Clauses:
(a). Lessee shall comply with all applicable
laws, ordinances and regulations of ~' = state county
and municipality wherein tile same demised Premises are
located ~.vith regards to construction, sanitation,
licenses, or permits to 'do business and all ot]ner
matters.
(b). Lessee shall pay to the proper governmental
agencies and as they become due and payable all taxes,
assessments and similar charges which at any time dur-
ing the term of this lease may be taxed, assessed or
imposed upon the Lessee with respect to or upon the
leased Premises except those ~-~hich the Authority has
in this lease agreed to pay.
(c). That any property of the Authority damaged
or c_otro=ed by the Lessee, incident to the Less e s
-5-
use and occupation of said Premises, shall be promptly
r~paired or replaced by t!~e Lessee to the satisfactic, n-
of said Authority or in lieu of such repair or replace-
ment, the Lessee shall, if so required by said Authority,
pay to the Authority money in an amount sufficient to
compensate for the loss' sustained by the Authority by
reason of damage or destruction of said property.
(d). In the avant the Lessee fails or neglects to
procure the insurance required by this !ease or to pay
the premiums thereon or to properly maintain and keep
in force said insurance, the Authority shall have the
right and privilege to procure such insurance and to
~remiums paid shall
pay t~he premiums thereon and any ~
be deemed as additional .rental and shall be due and
payable with the next installment of rent due hereunder.
(e). Lessee acknowledges that it has
and kno~,s the condition of the leased prouerty and
is understood that the same is bare,Dy leased without:
any representation or ,~,~arranty by the Authority 'wha%so-
· " t:~= Authority
ever and wlthout ob!igatio, n on the Dart of
~ =~= ad. di~ ~ thereto
to r,.~ake any alterations, r-p ..... or ~_o,,s .
(f). i-~o Lessee shall use or permit to be used
any portion of the property under its control for s:kgns,
billboards or displays, other khan those connected ~ith
its own operations t~ereon. Advertising signs must be
located on the bui~'~- . .the Premises and shall
contain more than 120 square feet in area. Flashing or
illuminated signs in which the light is not maintained
~ - -, and constant in intensity and color shall be
s ta.,_onar~
prohibited.
(g). All loading docks for buildings or warekouse
shall be maintained on ~.le -~ _ or rear of the buildings.
(h). Lessee shall not be the agent of the Authority
in ~%a]:ing repairs or other improvements to the above
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Premises and no m~chanics !ians or claims thereunder
shall be valid against the Authority or against th~-
interest of the Authority in said property.
(i). i~o materials, supplies or equipment shall
stored or be ~.=rm~d to remain on any part of th% Drop-
erty outside of the buildings constructed thereon, unless
such storage shall be sight-screened from the street.
Such storage shall be confined to the rear and sides of
buildings and in no instances be~.~=~=~-~ on tkat sid=-
of the building paralleling an existing or proposed street.
· ~_m=s keep the Premises
(j) The Lessee must at all ~ -
and buildings in a safe, clean, ~¢holeson~condition, and
comply zn all ~ =pects to all government, health and
police requirements and the Lessee will renove at its
own expense any rubbish which may accumulate on said
property.
· (k). Open, unpaved areas shall be grassed and
landscaped to present a pleasing appearance and such
grass and landscaping kept reasonably mov~e~ and. trimmed.
This agreement shall be binding upon the heirs, executors,
administrators, successors and assigns of the respective parties
to this agreement.
IN ~[ITNESS WHEiqEOF, the respective parties have hereunto
caused this instrument .to be executed on its behalf by its duly
authorized officers all on the'date and year first above mentioned.
Secretary
ATTEST:
:~ .> e c r e t a r y ~,~/
Salina Airport Authority
Ch'~.i~'~ ~Bo~rd of D:i.?e~,tors !
Hocking Farms,?-~nc~. ~