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Out west, because of how the railroad acquired property for its purposes back in the 1800s, the US government end up with a series of landholdings that are checkerboarded with private landholdings. Imagine a checkerboard where every black square is private property and every red square is public lands. The government did this on purpose thinking the land would all be valuable and by giving the railroads every other section it would increase the value of the remaining held sections and the land held by the government would be sold to offset the land given away.

Turns out, people who wanted to move west were not wealthy land buyers, so the government ended up holding the bag on some of these parcels to this day.

Now imagine the private squares are all owned by one landowner How does the public access its property for hunting or recreation? The basic concept is “corner crossing”, where you step form the corner of one government square to the other. In practice, that involves your arms and legs probably invading the airspace of the other privately held lands. To the private landowner, this idea is bunk as it allows access to public grounds that otherwise could only be accessed via their permission across their ground. The script is flipped when private landowners have forest areas that are checker boarded and they want access over government lands. There the government may be reluctant to allow corner crossing as without it, the private lands are subject to whatever access and forest management practices the government wants to allow. In other cases, the government granted checkerboard parcels on Native American lands, effectively fractionalizing reservation lands and setting up conflicts between various interests.

In 2021, some hunters pushed the issue to the courts when they were accused of criminal trespass by the landowner when they corner crossed. The jury said not guilty. The civil case is still winding its way through the federal court with a ruling favoring corner crossing as not a civil trespass from a district court now being challenged in the federal appeals court. The hunters are relying upon Unlawful Inclosures (yes, that is how it is spelled) Act of 1885 and a ruling from the appeals court in the 1900s that indicates following sheep into a cross corner is not an invasion. The appeals court at that time was the 8th before it was split. The 6000 acre land owner based in North Carolina who is fighting it, says because the ruling was before the 8th was split into the 10th and the 8th, it doesn’t hold water and a later case involving a road construction attempt to corner cross favored the landowners position.

The application is about air space, which has big ramifications for drone use in ag and retail applications. When can you stop a drone from flying over your property , however briefly? Right now, a world war II era case establishes landowners have a 400 foot right above their land to exclude others. This case, though about hunting can be boot strapped into future arguments about corner cutting by drones as the stay on the quickest path to deliver our consumer goods.

What stage are you at?

I believe that we have several stages of life when estate planning to consider.

The first is the wonder stage. This is when you are just starting out and wondering about where life will take you and what will happen. You still need a will and powers of attorney.

The next is blunder. This stage is when you start pushing into your interests and figuring out what works and what doesn’t. You may have failed business, wild success, and unforeseen events in the blunder stage. You need everything from the wonder stage plus some sort of wealth replacement or contingency plan documents like life insurance or a line of credit.

The next is the thunder stage. This is when you are accumulating wealth and executing on your vision that you refined while blundering. Now options to grow and preferential deals with other resource holders become important. Formal relationships and business entities play a role.

Following thunder is the sunder stage. This stage of your life is when you should consider separating assets into various groupings, selling assets, or pushing them down to the next generation. Now you are considering rights of first refusal to the next generation, plan sales, reduction in work, and gifting.

The final stage is the down under. This stage is, depending on your personal ethos, preparing for the next great chapter of your story, preparing to haunt your friends and relatives or simply transitioning to an official daisy pusher. All the prior stages have a role to play as do an honest assessment of what you can do and script for in advance and what you have no control over.

Each one of these stages calls for different considerations and different planning documents to address your departure during that stage of your life.

A friend of mine was recently asked to define what is a good estate plan. One of the responses was:

“A system of production asset and real property management and disposition that secures control to the producer(s) bearing the greatest financial risk, flexible enough to absorb the shocks and family member relationships" or Land wealth retention plan. (Citation available on request).

My response to the question was laid out below with Apologies to CLAUSEWITZ, On War and Sun Tzu, The Art of War

It is a very difficult task to construct a theory for the art of a good estate plan and so many attempts have failed that most people say that it is impossible.

We would give up on estate planning but we can all agree to certain maxims that exist:

That on farm heirs will be disadvantaged in the absence of a well thought out and executed plan;

That each benefited party to an estate plan has potential reactions and participations should be evaluated from the angle for their own pecuniary gain first and that of their off spring second;

That clearly defined objective and distributions of assets and power are essential and that all thoughts of parties getting along or making decisions for the benefit of a collective over their own best interests because they always have to date or have shared genetic material is a sure fire way to destroy a plan;

That money and assets provided to off farm children can and will serve as a resource pool to litigate grievances, real and perceived, against the on farm heir while the on farm heir will be provided assets that they seek to shepherd for the business continuity and place them at a disadvantage in litigation;

That success must be defined not the plan maker and nobody else;

That every year that wealth is transferred to the on-farm heir during the elder generations life time erodes the position of the off farm heir to claim inequitable treatment or surprise;

That winners plan ahead, and planning is identifying who is responsible for strength and weakness, what are those strengths and weaknesses, where are those strengths and weaknesses, when are those strengths and weaknesses exposed, and as a result what advantages are available and how they should they be leveraged.

It might be a bit jaded but, based on just this last week’s conversations about conflict between off farm heirs and on farm heirs and the number of court actions I have seen recently where otherwise rational adult children of a farm operation turn to the court to divide and parse out the family land wealth, it is accurate.

The old country song about “that ain’t Country” coupled with a Supreme Court ruling about when something qualifies as hardcore porn that essentially says “I know it when I see it,” doesn’t quite get a handle on what portions of the law of the land impact farm operators. Food and fiber production impacts us all and many layers of the law impact that production.

The American Ag Law Association annual meeting was held 10-11 NOV. Here is sampler of that topics the nation’s premier ag lawyers are currently wrestling with.

Urban Ag and Food Issues, Pipeline Projects, Federal Ag Policy (Farm Bill), Wetlands regulation, Ag Finance, Gene Editing, Ag producer contract agreements, Food traceability and its impact on food production, Anti-trust and Cooperative Law issues, Confined Animal Feeding regulations, Long term care cost impacts on farm operations, Agri Tourism, Farm Bankruptcy, Carbon Capture, Solar Leases, Immigration law impact on Ag operations, Land Use law updates, tax law updates, civil rights cases against the USDA, Artificial Intelligence and autonomous ag equipment, copyright and trademark law in the ag space, and internet sales direct from the farm. That is a wide swath of coverage.

We like to think as farm operators in the remote portion of the country we are exempt from a number of things and issues. Sure, we are outside of the Border Patrol’s 100 mile buffer zone (and the international airport radius for many of us), we are predicted to not be in a direct nuclear fall out zone and our population is low. The laundry list above does impact northeast Iowa and being aware of what laws are being implemented is important.

Here is an example

The latest requirement from the federal government will require all corporations, LLCS, and partnerships (really any business entity filed with the secretary of state) to report all owners who have over 25% or have substantial control of the organization.

The idea is to stop money laundering. Instead of having shown probable cause and get a warrant to dig into a private company’s books, the feds will just be able access the self-populated data base of ownership interest and take a look.

Not overly impressed with skipping the constitutional privacy and probable cause barriers that were removed by requiring the reporting at all. Also, we have seen that no government actors have ever misused or abused access to information for private gain. Oh wait, police officers using criminal background checks for potential tinder hookups was just in the news.

It will cost your organization some money as either a lawyer or tax preparer is likely going to have to file the information for your organization. The law passed in 2021 but true to form the regulations and details are now just starting to jell up. The overlords may give an extra year before implementation but then again, they don’t seem to be getting much done in the Potomac these days.

What’s is the ag law connection? Not only do farm operations use these entities for their own liability and business succession planning, but also they interact with those companies all the time. Those companies are going to pass the cost of this compliance on to the consumer (farm operator) who will not be able to pass that cost in most cases when they sell bulk commodities.

Taste the rainbow… California is in charge …. Again

Fresh off its dictation to the pork industry on production methods, the California EPA has banned red dye no 3. This is based on peer reviewed articles where some of the information says the dye causes behavioral and cognitive issues in kids. Of note, the federal EPA hasn’t made the same stance. The dye is in a large amount of products and as California is one of the largest markets for consumption, food industry members will likely fall in line like the pork industry appears to be doing. They have until 2027 to come to heel.

Of note, this ban was labeled the “Skittles ban” as at one time, the ban included Titanium dioxide, which is part of the north American formulary for Skittles. That substance is still authorized, and Skittles doesn’t use Red 3 (nor does M&Ms btw). So, you are free continue to debate with your friends if the original Skittles have a different taste by color (the company position) or if they just smell different and that is what causes the taste difference (Neuroscientist Don Katz at Brandies University’s position)

Big Meat, Big Data, little paycheck for producers.

The USDOJ has taken aim at Agri Stats, Inc for its aggregating and sharing data with meat industry producers as an anti-trust action under the Sherman Act. The government is concerned the meat industry harmed farmers by having access to this information and flattened prices and output. The Company claims no harm no foul.

Big meat doing big meat things to farm producers is nothing new. Data drives decisions and if all the buyers of your product have all of the data and you have none, its easier to walk up the Bear Sand Dunes along Lake Michigan. If the DOJ actually gets somewhere that will be new. Upton Sinclair was the last effective anti-Trust regulator in the meat industry as far as I am concerned.

Treatment rules expanding.

The EPA has let the world know that it is considering adding pesticide coating treatments to the list of things that have to be inspected by FIFRA (Federal Insecticide, Fungicide and Rodenticide Act. Currently treated seed is exempted by a specific EPA determination. This change in position comes after environmental groups filed suit after first asserting their request in 2017. New York is already wading in on the side of regulation at the state level as they are considering a ban of treated seeds. I do think in this instance if the feds don’t expand the coverage, the I states (Iowa, Indiana, Illinois) have enough seed purchasing power that even California joining the ban at the state level won’t make treated seeds go away anytime soon.

Avast, Seed Pirates!

Corteva sued Inari Ag alleging they used another party to obtain genetic material and plant protected seed. This would be prevented under the PVP (Plant Variety Protection) certificates that Corteva has. Cortevea has indicates that Inari further modified the seed and tried to obtain its own patent.

This action is part of a larger effort by those who invest in seed technology to prevent those who didn’t’ from benefiting from their research and development of the product. It is sometimes referred to as seed piracy as it is a theft of intellectual property, and the image of a pirate immediately shapes the minds eye on who is the bad operator.

Friday, February 23, 2024
  • Patrick B. Dillon
  • Jill Dillon
  • Tori Beyer
Dillon Law PC
Patrick B. Dillon enjoys finding solutions to legal issues and catching problems for clients. Pat practices in the Sumner office regularly represents clients in district, associate district and magistrate courts for agricultural, real estate, criminal and collection issues. He drafts wills and trusts, creates estate plans and helps clients through the probate process.
Dillon Law PC
Jill is a University of Northern Iowa undergraduate (Political Science Cum Laude) and a Drake University Law School graduate. Jill is a firm owner but not currently accepting private pay clients. Jill still has ties to her family farm operation which includes a dairy herd.
Dillon Law PC
Tori is a University of Iowa undergraduate where she double majored in Criminology, Justice, and Law and Ethics and Public Policy and a North Dakota Law School graduate. Tori practices in the Sumner office. Tori's areas of practice include but are not limited to estate planning, wills/probate, criminal defense, and civil litigation.

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