IN THE COURT OF APPEALS OF IOWA

No. 14-1482

Filed August 5, 2015

RONALD PECK,

Plaintiff-Appellee,

vs.

FOUR ACES FARMS, INC.,

Defendant-Appellant.

________________________________________________________________

Appeal from the Iowa District Court for Poweshiek County, Annette J. 

Scieszinski, Judge.

Four Aces Farms, Inc. appeals from the district court’s order granting a 

declaratory ruling and judgment in favor of Ronald Peck. AFFIRMED AS

MODIFIED.

Catherine M. Lucas and Todd A. Strother of Bradshaw, Fowler, Proctor 

& Fairgrave, P.C., Des Moines, for appellant.

William J. Lorenz and Norma J. Meade of Moore, McKibben, Goodman 

& Lorenz, L.L.P., Marshalltown, for appellee.

Heard by Danilson, C.J., and Vaitheswaran and Doyle, JJ.
2

DOYLE, J.

Four Aces Farms, Inc. (“Four Aces”) appeals from the district court’s 

declaratory ruling and final judgment order concluding an oral 50/50 crop share 

agreement supplemented its written cash rent lease agreement with Ronald 

Peck. We are not persuaded Peck established his case by the requisite degree 

of proof and we therefore modify the district court’s declaratory ruling and 

judgment.

I. Background Facts and Proceedings

Ronald Peck is a retired farmer and businessman who owns 690 acres of 

farmland in Poweshiek County, Iowa. Peck farmed the 690 acres himself until

November 2006, when he decided to lease the property to Four Aces. Four 

Aces, an Iowa Corporation, is operated by Douglas Helm, a former math teacher 

who began farming full time in 2001. Mark Kennett, an agronomics consultant 

and Peck’s then-partner in a chicken litter1application venture, facilitated the 

landlord-tenant relationship between Peck and Helm. 

Helm prepared a farm lease for the 2007 crop season which was signed 

by the parties in November 2006. The lease provided that Four Aces would pay 

Peck $195 per acre for 689.5 acres, with payment of $67,226.25 due on March 1, 

2007, and $67,226.25 due on December 1, 2007. The lease contained only two 

additional terms: that Four Aces would pay $0.10 per bushel for rent of storage 

bins (and would be responsible for electricity and propane associated with the 

 

1

“Poultry litter” includes poultry feces and bedding. Farmers use the poultry litter “as 

fertilizer on their fields, and often sell or barter it to others.” Att’y Gen. of Oklahoma v. 

Tyson Foods, Inc., 565 F.3d 769, 774 (10th Cir. 2009).
3

use of the bins), and that Peck would provide “3 ton of chicken litter at the rate of 

$20 per ton” to be paid for by Four Aces.2 

Four Aces proceeded to farm the land. During the summer of 2007, when 

it appeared it would be a very good crop year with rising prices, Kennett talked to 

Helm. Under the circumstances, it was thought Peck would “be expecting 

more—more money.” The two discussed how to keep Peck satisfied so that 

Four Aces could continue renting the farm. They discussed paying Peck a 

bonus—one that would satisfy Peck but still maintain a profit for Four Aces. Four 

Aces paid the 2007 rent pursuant to the lease terms. Helm testified that at some 

point he told Peck he would be paid some type of bonus. In September 2008, 

after the 2007 harvest had been sold, Four Aces paid Peck a “bonus” of

$61,251.72, and Helm presented Peck with a detailed accounting showing how 

he had calculated this extra payment. Specifically, Helm reached the amount by 

taking half of the “Shared Income” (gross income minus “Shared Expenses”),

reduced by the rental payments Four Aces had already made to Peck. Helm 

later testified he chose the method of calculation to be “fair to both of us” in an 

effort to “help to continue things for ’09 and beyond to maintain good relations” so 

that Peck would continue to lease the farm to Four Aces. Peck maintained the 

payment and method of calculation were in accordance with their “50-50 

agreement.” 

Four Aces continued renting Peck’s land. In November 2007, the parties 

signed a written lease for the 2008 crop year, which was identical to the 2007 

 

2 The lease also contained a handwritten provision that “this contract is void as of March 

1, 2008.”
4

lease except for an increase in the rent amount to $200 per acre and omission of 

the chicken litter provision. As it had done the previous year, after the 2008 crop 

was marketed, Four Aces presented Peck with an additional payment than that 

required by the written lease—this time in the amount of $27,497.05. Again, 

Helm gave Peck a detailed accounting showing how he calculated the extra 

payment, using the same method as he had for the 2007 payment. Helm later

testified he made the additional payment to Peck in order “to incentivize, to keep 

continue renting the farm and maintain good relations.” In contrast, Peck testified

the parties continued to have an oral agreement that required Four Aces to share 

profits with him. 

The 2009 crop year unfolded similarly. In December 2008, the parties 

signed a written lease for the 2009 crop year, which was identical to the 2008 

lease but for an increase in the bin rental rate to $0.16 per bushel. In the fall of 

2010, Four Aces again presented a summary of the profitability of the 2009 crop 

year. This time, however, the summary showed that the cash rent Four Aces 

paid to Peck exceeded the profits from the farm, and Four Aces made no 

additional payment for the 2009 crop year. Peck later testified the rent required 

by the lease only represented a minimum and that the oral agreement for profit 

sharing continued to exist. 

The parties did not enter into a new written lease for the 2010 and 2011 

crop years. Four Aces continued to rent and farm Peck’s property. Peck later 

testified that the 2009 lease was “carr[ied] over” and continued in effect through 

the 2010 and 2011 crop years. 
5

The parties’ relationship began to sour in 2011 after a disagreement arose 

when a Four Aces employee loaded 2010 grain from Peck’s farm into a trailer 

partially full with Four Aces’s grain. Peck felt Four Aces was “cheating” him by

commingling the grain. Helm agreed the employee’s actions were improper. 

The incident forced Four Aces to estimate the amount of grain in the load that 

came from Peck’s farm. 

While wintering in Florida in early 2011, Peck fell ill, which prevented him 

from farming 61.7 acres owned by his wife, Beverly, as he had in prior years. 

Peck contacted Helm seeking Four Aces’s assistance with Beverly’s land, and 

Helm “said he would help out.” Peck later testified he had no kind of agreement 

with Helm about the rent, while Helm testified they agreed Four Aces “would just 

cash rent it . . . under the same lease agreement” it had with Peck. 

In August 2011, Peck sent a “Notice” to Four Aces that the contract 

regarding Peck’s land and Beverly’s land was “cancelled” for the 2012 crop year.

In the fall of 2011, as in prior years, Four Aces prepared a summary for 

Peck showing the profitability of the 2010 crop year. Based on the calculation, 

Four Aces offered to pay $19,218.14 to Peck. Peck refused to accept the 

payment, later testifying that it was not “calculated proper, and it was not honest 

per our agreement.” According to Helm, he later called Peck and offered him 

more money in an effort to continue Four Aces’s status renting the farm, though 

he could not recall the amount he offered. 

On November 1, 2011, Peck sent Four Aces a letter instructing Four Aces

not to market any of Peck’s grain and stating, “I will notify you when I desire for 

the grain to be sold.” Peck filed a Uniform Commercial Code (UCC) Financing 
6

Statement covering “[a]ll crops grown upon” the property, establishing a landlord 

lien. 

Helm later testified the grain was not Peck’s (“It was [Four Aces’s] grain”), 

so Four Aces disregarded Peck’s letter and sold the grain from the farm. A

disagreement arose as Four Aces was removing the grain stored on Peck’s

property, eventually involving law enforcement and the parties’ attorneys. Helm 

presented the sheriff with a written lease for the 2011 crop year; Helm had 

signed Peck’s name on the lease, but later testified Peck had “directed” him to do 

so. 

In a November 2011 letter to Peck, Four Aces (through its attorney) 

detailed what it represented as “payment in full” for the outstanding amounts 

Four Aces owed Peck under the written lease, and did not mention a crop share 

agreement between the parties. The letter included four checks to Peck from 

Four Aces: $68,950 for “2011 land rent/2nd half”; $9272 for “storage 2010”; 

$10,817.60 for “2011 storage”; and $12,340 for “2011 cash rent” for Beverly’s 

61.7 acres. In the letter, Four Aces alleged Peck violated the lease by chopping

and chiseling the corn stalks, thereby retaking possession of the properties early 

and preventing Four Aces from harvesting the corn stover3 when the lease 

granted Four Aces possession of the properties until March 1, 2012. In closing, 

the letter included a formal demand for release of the UCC Financing Statement 

 

3 Corn stover is defined as “corn stalks, leaves, and cobs remaining above ground on the 

field after the harvest of corn kernels.” Jack W. Leverenz, Corn Flakes Aren’t Just for 

Kellog’s, A Look at Corn Stover and Its Effect on Leasing in the Landlord Tenant 

Relationship, 17 Drake J. Agric. L. 511 (2012). 
7

filed by Peck, asserting that Four Aces “has performed all obligations under the 

Farm Lease between the parties.” 

Peck’s attorney returned the checks to Four Aces’s attorney with a letter 

stating:

For the years since 2007, the agreement has been that Four Aces 

Farms would lease Mr. Peck’s land on a 50/50 crop share basis 

with a minimum of $200 per acre. It is also our position that 

Beverly Peck leased her land to Four Aces Farms, Inc. for the 2011 

crop year on the same terms as the existing lease between Ron 

Peck and Four Aces Farms.[4]

Knowing it would not be renting Peck’s farm any further, Four Aces did not 

offer any additional or bonus payments for the 2011 crop year. At the request of 

Peck’s attorney, Four Aces created a summary of profitability for the 2011 year, 

which included calculations for Beverly’s 61.7 acres. 

In March 2012, Peck filed a petition for declaratory judgment and for 

accounting against Four Aces.5 Peck alleged the parties’ lease agreement was 

in fact a “50/50 crop share lease” that also required Four Aces to pay the 

minimum amount stated on the written lease. Peck claimed the written leases 

did not represent the full agreement between the parties. Peck further alleged

Four Aces’s year-end summaries incorrectly incorporated crop sales from other 

Four Aces farms when calculating prices received for Peck’s crops. Finally, Peck 

claimed Four Aces did not lease the additional 61.7 acres, rather Four Aces 

merely performed the farm work for him. Peck requested the district court 

declare, among other things, that the leases “required that [Four Aces] pay a 

 

4

The letter further stated it was not the full statement of Peck’s position and that the 

purpose of the letter was to return the checks. 

5 Peck also named Helm, personally, as a defendant, but Helm was dismissed as a 

defendant on June 9, 2014, leaving Four Aces as the sole defendant.
8

minimum rent based on cash and rent based on a 50/50 crop share”; a full 

accounting in order to determine the proper net income for each year; a judgment 

for the difference between that paid and owed based on this new accounting; a 

declaration that Peck was entitled to receive the 2011 crop from Beverly’s 61.7 

acres from Four Aces, and a declaration that Four Aces was entitled to 

compensation for planting, spraying, and harvesting the crop on Beverly’s land at 

ordinary and customary custom rates.

Four Aces filed an answer and counterclaim, denying the existence of a 

50/50 crop share agreement. Four Aces further claimed it leased Beverly’s 61.7 

acres on terms identical to the written leases between Four Aces and Peck. In a 

counterclaim, Four Aces alleged that in 2011, Peck prevented Four Aces from 

harvesting corn stalks from the properties in violation of Iowa Code section 

562.5A (2011), and sought an order requiring Peck to reimburse Four Aces for 

the lost value of the unharvested corn stover. Other counterclaims and defenses 

are not at issue on appeal. 

In August 2014, following a one-day bench trial, the district court entered a 

declaratory ruling and judgment order in favor of Peck, concluding the parties 

had an oral crop share agreement supplementing the written farm lease:

The parties’ division of farm profits originated during their initial 

associations as landlord and tenant for the 2007 crop year, and 

was sustained throughout their lease relationship. The meeting of 

their minds on sharing the farm’s production potential arose in oral 

discussions Peck had with Helm with the aid of Kennett, as the 

2007 crop was growing. Both parties realized they had a written 

lease in place for Four Aces to pay Peck $195 per acre in two 

installments; nonetheless, with the March 1st installment already 

paid, Peck and Helm refined their deal. It was in the summer of 

2007 when the crop was looking very good, that they agreed to 

incorporate a sharing of profits into the agreement.
9

In reaching this conclusion, the district court considered the testimony of Peck 

and Helm, as well as Kennett.6 The court found the previous course of dealings 

between the parties—especially the methodical nature with which the annual 

additional payments and summaries were made from Four Aces to Peck—to be 

significant in reaching its conclusion. 

The court determined Four Aces owed to Peck $19,218.14 for the 2010 

crop share; $9,272.00 for 2010-11 bin rent; $68,950.00 for the December 2011

cash rent installment; $94,090.74 for 2011 crop share; $10,817.60 for 2011-12 

bin rent; and $12,400.00 for 2011 cash rent for Beverly’s land—a total of 

$214,748.48. 

The court found in Four Aces’s favor on its corn stover counterclaim, 

stating that by prematurely chiseling the corn stalks Peck denied Four Aces its 

leasehold right to recover the “full measure of the crop” pursuant to Iowa Code 

section 562.5A. The parties stipulated the value of the corn stover Four Aces 

was prevented from harvesting was $20,429.00. The court awarded Four Aces 

half of this amount—$10,214.50—finding Peck was entitled to half of the value of 

the stover. The court also credited Four Aces for $461.90, half the cost of a bin 

repair made by Four Aces. 

After off-setting the award to Four Aces on its counterclaim, the district

court entered judgment in Peck’s favor in the amount of $204,072.08. In 

 

6

It is noted the district court reached its conclusions based upon a preponderance of 

evidence standard.
10

addition, the court ordered Four Aces to pay interest at a rate of five percent7

from March 28, 2012, the date on which Peck filed the suit.8 

Four Aces appeals. 

II. Scope and Standards of Review

The standard of review for a declaratory judgment varies by how the case 

was tried. See Owens v. Brownlie, 610 N.W.2d 860, 865 (Iowa 2000). The 

parties agree the district court tried this case in equity. We conduct a de novo 

review of cases tried in equity. Iowa R. App. P. 6.907; Owens, 610 N.W.2d at 

865. We give weight to factual findings made by the district court, especially 

regarding the credibility of witnesses, but we are not bound by them. Owens, 

610 N.W.2d at 685. 

III. Parol Evidence

Four Aces contends the district court “improperly considered parol 

evidence to modify the terms of an existing written contract.” Four Aces claims 

the parties’ written farm lease “set forth all terms needed to carry out 

enforcement of the agreements” and parol evidence of “[t]he alleged oral 

agreement” could not be used to vary or add to those terms. 

A. Error Preservation. Peck contends this issue was not preserved for 

review. As Peck points out, Four Aces never objected at trial to the use of parol 

evidence and the district court never ruled on the issue. 

 

7

The district court cited to Iowa Code section 535.2(1)(b) in imposing the five-percent 

rate. 

8 The date set by the district court from which the interest runs is not challenged by 

either party.
11

Four Aces counters that its submission of a pretrial brief—which included 

a claim that the court was precluded from considering parol evidence—preserves 

the issue for appellate review despite the absence of a ruling by the trial court on 

the issue. Although the parol evidence rule is a substantive rule of law, standard 

error preservation rules regarding the admission of evidence apply to parol 

evidence issues. See Top of Iowa Coop. v. Sime Farms, Inc., 608 N.W.2d 454, 

470 (Iowa 2000). “It is a fundamental doctrine of appellate review that issues 

must ordinarily be both raised and decided by the district court before we will 

decide them on appeal.” Meier v. Senecaut, 641 N.W.2d 532, 537 (Iowa 2002).

This case was tried in equity, and in such cases “‘the trial judge, while 

noting objections, may not exclude offered testimony’” in order to “preserve a 

complete record of the evidence for the trial and the appellate courts, leaving to 

them the rejection of inadmissible testimony in deciding the issues.” See O’Dell 

v. O’Dell, 26 N.W.2d 401, 416-17 (Iowa 1947) (quoting Rankin v. Schiereck, 147 

N.W. 180, 182 (Iowa 1914)). Accordingly, at issue is not the admission of the 

parol evidence challenged by Four Aces, but the court’s consideration of that

evidence.

Throughout the one-day bench trial, Four Aces lodged no objections to 

evidence that arguably implicated the parol evidence rule. The pretrial brief that 

purports to raise the issue of parol evidence did not become a part of the record, 

though its existence is acknowledged by the parties.

Four Aces claims that by considering the parol evidence when deciding 

the case, the district court implicitly ruled on the issue and that this, coupled with 

its argument in its pretrial brief, satisfies the preservation requirements. The 
12

district court’s ruling refers to an oral agreement and Helm’s calculations and 

summaries as being evidence of an oral contract between the parties. The 

inference could be drawn that the district court ruled against Four Aces by using 

the evidence in reaching its ruling. But without the benefit of objections at trial 

and Four Aces’s pretrial brief, this court cannot be sure which pieces of evidence 

were contested by Four Aces. The two requirements for preservation, that the 

issue be both raised and decided by the court, have not been convincingly 

established. See Meier, 641 N.W.2d at 537.

B. Consideration of Parol Evidence. Bypassing this error preservation 

concern, see State v. Taylor, 596 N.W.2d 55, 56 (Iowa 1999) (bypassing error 

preservation problem and proceeding to the merits of the appeal), we do not 

conclude the district court erred in considering extrinsic evidence. “When an 

agreement is fully integrated, the parol-evidence rule forbids the use of extrinsic 

evidence introduced solely to vary, add to, or subtract from the agreement.” 

C & J Vantage Leasing Co. v. Wolfe, 795 N.W.2d 65, 85 (Iowa 2011). An 

agreement is fully integrated “when the parties adopt a writing or writings as the 

final and complete expression of their agreement.” Id. The presence of an 

integration clause, while considered, is only one factor used in determining if the 

contract is integrated. See id. Extrinsic evidence may be used to consider if the 

written contract is in fact fully integrated “despite the absence of . . . ambiguity on 

the face of the document.” In re Eickman Estate, 291 N.W.2d 308, 312 (Iowa 

1980).

Once it is established that an agreement is not fully expressed in writing, 

extrinsic evidence may be used to find the entire contract. See Sol Popofsky Co.
13

v. Wearmouth, 248 N.W. 358, 360 (Iowa 1933); see also Cargill, Inc. v.

Fickbohm, 252 N.W.2d 739, 741 (Iowa 1977) (allowing oral evidence to show the 

delivery date term when that field on a form contract had been left blank). “A 

contract may . . . be partially written and partially oral.” Cargill, Inc., 252 N.W.2d 

at 741. As expressed in Sol Popofsky Co.:

[W]here the entire agreement is not fully expressed in the writing, 

and where part of the agreement is oral and part in writing, parol 

evidence may be introduced to show the entire contract . . . . If the 

parol part concerns a matter not covered by the writing, then, the 

written and parol parts being harmonious, the parol part may be 

shown along with the written. 

248 N.W. at 360. The caveat is that the “parol terms may not directly contradict a 

clear term of the written agreement.” Id.

Four Aces argues that the written lease captures the entire agreement 

between the parties and thus prevents the consideration of parol evidence. The 

language Four Aces relies on reads: “Tenant agrees to pay the owner $200 per 

acre” and “[t]he land rent is . . . $137,900.” 

At the outset, we observe the lease lacks an integration clause, which is 

one factor to consider, although it is not dispositive. See C & J Vantage, 795 

N.W.2d at 85. Describing the written lease as skeletal would be generous 

considering the major bones it is missing. There is no legal description of the 

leased parcels.9 The written lease does not describe the type of crops to be 

grown and, in fact, did not even require Four Aces to farm the land. Nor did the 

written lease preclude Four Aces from using the land for non-farming purposes. 

 

9

The lease only indicates the 690 acres of leased parcels were located somewhere 

within four square miles of land. The parcels were located in four separate sections of 

land. A section is defined as “[a] piece of land containing 640 acres, or one square 

mile.” Black’s Law Dictionary 1473 (9th ed. 2009). 
14

Four Aces could have used the land to stage a Wadena-like rock festival, or it 

could have operated a salvage yard on the property. Other terms typically found 

in a farm lease are absent. The absence of these significant terms supports the 

court’s finding that the lease was not the full extent of the parties’ agreement—

the parties obviously knew the location of the leased land and that it was to be 

used for farming, but simply did not memorialize these terms in the written lease.

The “totality of the evidence” is to be considered when determining if a 

written agreement is fully integrated. See id. The surrounding circumstances 

and vagueness of the lease persuasively point toward a non-fully integrated 

agreement between the parties, which allows for the consideration of parol 

evidence to show the unwritten portion of that agreement. See Sol Popofsky 

Co., 248 N.W. at 360. The district court properly considered the parol evidence, 

so we next turn to the question of whether or not Peck established that there was 

a 50/50 oral crop share agreement.

IV. Oral Agreement

Peck argues that “[i]n order to give any real meaning to the written 

contract entered into between the parties, it would be necessary for the parties to 

also have an oral contract,” and “the course of conduct between the parties over 

the 2007 through the 2011 farm years [evidenced] the parties’ oral agreement.” 

The parties’ written agreement,10 entitled “Farm Lease,” provides in full:

This lease is made between Ron Peck, owner and Four Aces 

Farms, tenant. This lease will be from March 1, 2009 to March 1, 

2010. The parcels of land are approximately 689.5 acres. The 

 

10 Minor changes were made to the leases for the 2007, 2008, and 2009 crop years. For 

our purposes, we have used the 2009/2010 lease because that was the lease renewed 

due to lack of termination and in effect at the time the dispute between the parties arose. 
15

parcels are located in Section 29 of Scott Township, Section 34 of 

Pleasant and Sections 5 & 6 of Jackson Township of Poweshiek 

County. Tenant agrees to pay the owner $200 per acre.

The land rent is $200 x 689.5 acres = $137,900.

The tenant will pay $68950 on March 1, 2009.

The tenant will pay $68950 on December 1, 2009.

The tenant will pay bin rent at 15 cents per bushel. The

tenant will also pay electricity and propane used.

The written agreement includes no reference to any agreement between 

the parties to share crop profits or other revenues or expenses. But that does 

not preclude an oral agreement co-existing with the written agreement. This type 

of relationship has been acknowledged by the supreme court: 

An examination of our lease cases wherein oral evidence was 

offered to show a collateral agreement shows where the parol 

evidence is of an agreement which did not vary or affect any of the 

terms of the written lease, but was beyond and independent of it, it

was admissible. In [Witthauer v. Wheeler, 150 N.W. 46, 47-48 

(Iowa 1914),] plaintiff leased from defendant, in writing, for two 

years a 2400 acre ranch only 200 acres of which was tillable, as a 

farm and stock ranch. The crop rent was fixed in the writing but no 

mention was made as to any agreement between the parties jointly 

conducting the business of stock raising, the parties to share 

equally in the increase of said stock. 

Gordon v. Witthauer, 138 N.W.2d 918, 920 (Iowa 1965). And as we observed in 

the preceding section, this is precisely the type of situation where extrinsic 

evidence may be admitted to show the complete duties and obligations of the 

parties. See Witthauer, 150 N.W. at 47-48 (affirming admission of evidence of 

“conversations between the parties prior to the execution of the written lease [to 

rent land to use as a farm and stock ranch], which as claimed resulted in an 

agreement between them that appellant was to stock the ranch with cattle which 

were to be cared for by the appellee, and the increase of the same was to be 

divided between them”); see also Parriott v. Levis, 195 N.W. 578, 579 (Iowa 
16

1923) (“[T]here may be at the same time two contracts coexistent, one of which 

is in writing and complete in itself, and the other of which is in parol and complete 

in itself. . . . In such case the written contract is not altered, varied, or changed 

by proof of the coexistent oral contract. The writing embodies the written 

contract, and the oral evidence established the parol contract. Even in such a 

case, evidence of a contemporaneous parol or collateral agreement is only 

available when it refers to a matter on which the writing is silent, and which is in 

no manner inconsistent with the terms of the written instrument.”).

That having been said, it is Peck’s burden to prove there was an oral 

agreement for a 50/50 crop share. Hawkeye Land. Co. v. Iowa Power & Light 

Co., 497 N.W.2d 480, 486 (Iowa 1993) (“A party who seeks recovery on a 

contract has the burden to prove the existence of the contract.”). “[P]roof of a 

claimed oral contract must be clear, satisfactory and convincing. A mere 

preponderance of the evidence is not enough.” Ehlinger v. Ehlinger, 111 N.W.2d 

656, 659 (Iowa 1961). For evidence to be clear and convincing, it is necessary 

“that there be no serious or substantial doubt about the correctness of the 

conclusions drawn from it.” Raim v. Stancel, 339 N.W.2d 621, 624 (Iowa Ct. 

App. 1983). Although only a reasonable certainty an oral contract existed need 

be shown, the terms must be sufficiently definite to determine with certainty the 

duties and obligations of each party. Netteland v. Farm Bureau Life Ins. Co., 510 

N.W.2d 162, 165 (Iowa Ct. App. 1993). “For a contract to be valid, the parties 

must express mutual assent to the terms of the contract.” Royal Indem. Co. v. 

Factory Mut. Ins. Co., 786 N.W.2d 839, 846 (Iowa 2010).
17

The written lease provides for cash rent only. To assure good relations 

and the ability to continue to farm the land, in 2008 Four Acres paid a bonus to

Peck in connection with the 2007 crop year. The initial bonus was calculated by 

Helm in a format reflecting shared income and shared expenses much akin to a 

50/50 crop share less the cash rent previously paid. Before paying the 2008 

bonus to Peck, Helm discussed the use of a bonus with farm consultant Kennett. 

Bonus structures were familiar to Kennett, and he explained bonuses were paid 

by tenants to landlords because the changing grain markets caused negotiated 

cash rents to go “out of whack.” The use of bonuses that were not contractually 

required also did not violate any rules of the governmental agency, Farm Service 

Agency (FSA). Four Acres also similarly calculated and paid a bonus in 2009. In 

2010, because of reduced profits, no bonus was paid. The landlord-tenant 

relationship then began to sour.

Unfortunately, the calculation and payment of bonuses apparently left 

Peck with the impression that he was somehow entitled to a 50/50 sharing of

profits—notwithstanding the unambiguous terms of the parties’ lease. It seems 

highly improbable that Helm would have agreed to Peck’s version of the contract 

terms because the contract would have run afoul of the FSA rules. Helm also 

had a logical reason for paying the bonuses—retaining the ability to farm the land 

for future years. Moreover, Peck presented no evidence of any conversations 

with Helm suggesting the parties agreed to a crop share arrangement with or 

without cash rent. At most, Peck testified, “It was a 50-50 agreement, which 

we’ve always done.” He referenced no specific conversations with Helm. On the 
18

other hand, both Helm and Kennett testified about their conversation concerning

providing a discretionary bonus to Peck. 

Other evidence also supports the position of Four Acres. The written

lease required full payment of bin rent and chicken litter by the tenant, which is 

inconsistent with a crop share arrangement where expenses are shared. Four 

Acres or Helm maintained the crop insurance on all the acres rented, and FSA 

forms reflected that Four Acres was the sole producer/operator. Further, Peck 

was not involved in any decision making, except to perhaps share his advice or 

predictions of the grain markets.11

Upon our de novo review of the record, we conclude Peck has not 

established by clear, satisfactory and convincing proof that an oral 50/50 crop 

share agreement was ever reached between these parties pertaining to Peck’s 

land or Beverly’s land. There was no meeting of the minds concerning a crop 

sharing arrangement. Accordingly, the district court’s declaratory ruling and 

judgment should be modified to strike the award to Peck of $19,218.14 for 2010 

crop share and $94,090.74 for 2011 crop share. Thus, Peck is entitled to recover 

 

11 One commentator has acknowledged the existence of flexible cash rent arrangements 

in stating, “Flexible or adjustable cash leases set the rent based on the crop yield, the 

crop price, or a combination of these attributes.” Edward Cox, A Lease-Based Approach 

to Sustainable Farming, Part II: Farm Tenancy Trends and the Outlook for Sustainability 

on Rented Land, 16 Drake J. Agric. L. 5, 23 (Spring 2011). But in crop share 

arrangements,

[t]ypically landowners contribute a share of the farm inputs and are more 

involved in land use decision making. This added involvement and risk 

can affect social security payments, taxes, estate planning, and the 

distribution of farm program payments. Simply stated, landowners would 

be more likely to be viewed as self-employed and more likely to be 

eligible for a share of any farm program payments. 

Id. Here the parties never committed to any formality of the bonus arrangement. 

Rather, it was left to the discretion of Four Acres. Further the only sharing Peck wanted 

to participate in was a share of the profits. 
19

$101,439.60 from Four Aces for 2020-11 bin rent ($9,272.00), 2011 cash rent 

installment ($68,950), 2011-12 bin rent ($10,817.60), and 2011 cash rent for 

Beverly’s land ($12,400). 

V. Corn Stover

As the district court found, “Peck took over during the fall of 2011 and had 

the corn stalks chiseled in for the 2012 crop preparations. That unilateral act 

before the lease end, denied the 2011 tenant [Four Aces] opportunity to harvest 

stover from 2011 corn production.” In view of the crop-share agreement it found, 

the court awarded Four Aces one-half the value of the stover. Four Aces 

contends the district court “improperly awarded only one-half of the crop stover to 

Four Aces,” contending that it had the right to collect “the full stipulated value of 

the stover: $20,429.” 

As set forth above, the parties’ agreement did not include a 50/50 profit 

sharing arrangement. Pursuant to Iowa Code section 562.5A, in the absence of 

a written agreement to the contrary, “a farm tenant may take any part of the 

aboveground part of a plant associated with a crop . . . until the farm tenancy 

terminates.” This court recently interpreted this language as entitling a tenant to 

damages for the value of the destroyed corn stover when the landlord entered 

the property before the termination of the lease to perform fall tillage, preventing 

harvest of the corn stover by the tenant. See Slach v. Heick, No. 14-0539, 2015 

WL 1546445, at *4, 18 (Iowa Ct. App. Apr. 8, 2015). Section 562.5A applies to 

leases that renew for lack of notice of termination after the provision’s effective 

date of July 1, 2010. See id. at *12, 15. Accordingly, section 562.5A applies to 

the parties’ lease for the 2011 crop year, as it was a renewal of the prior year’s 
20

lease due to lack of termination on September 1, 2010. See Iowa Code 

§§ 562.6, 562.7. Four Aces was therefore entitled to the full value of the stover, 

not half as found by the district court. Accordingly, the district court’s declaratory 

ruling should be modified to credit Four Aces in the amount of $20,429, the full 

value of the crop stover from the 2011 crop. 

VI. Interest Awarded on Amounts Tendered

Four Aces claims the district court “improperly awarded Peck interest on 

amounts that Four Aces had previously tendered and Peck had rejected.” Four 

Aces contends it is not obligated for interest beyond the date of tender. 

The district court ordered that the judgment of $204,072.08 “shall draw 

interest at the annual rate of five percent, factored from March 28, 2012 [the day 

Peck’s lawsuit was filed].” Four Aces contends its November 21, 2011 letter and 

enclosed checks totaling $101,379.60 was an unconditional tender to Peck, 

rendering the district court’s award of interest on these amounts improper. A

bona fide tender precludes the accrual of further interest on amounts due. See 

In re Estate of Zach, 131 N.W.2d 484, 486-87 (Iowa 1964). But the tender must 

be “absolute and unconditional” to be effective. Decorah State Bank v. Zidlicky, 

426 N.W.2d 388, 391 (Iowa 1988). 

Peck counters that language of Four Aces’s letter indicating the offered 

checks represented “payment in full” for the 2011 farm rent made the tender 

conditional—acceptance of which would form an accord and satisfaction 

discharging Peck’s claims against Four Aces. 

To constitute an accord and satisfaction . . . all that is 

necessary is that the money should be tendered in satisfaction of 

the claim; that the tender be accompanied with such acts and 
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declarations as amount to a condition that, if the money is taken, it 

is accepted in satisfaction. The conditions under which the tender 

is made, and the conduct of the party at the time of the tender, 

however, must be such that the party to whom it is tendered is 

given to understand that, if he takes it, he takes it in satisfaction of 

his claim, so far as the other party is concerned. He must either 

refuse or accept it. If he accepts it, he is bound. If he takes it, his 

claim is canceled.

Shahan v. Bayer Vehicle Co., 162 N.W. 221, 223 (Iowa 1917).

For the acceptance of the tender to be considered an accord and 

satisfaction, there must have been a genuine dispute concerning the amount 

due. See Olson v. Wilson & Co., 58 N.W.2d 381, 386 (Iowa 1953). The 

November 2011 letter individually listed the amounts enclosed for the 2010-2011 

and 2011-2012 bin rents. There was no dispute at the time as to the amount of 

bin rent due to Peck. These amounts were provided on separate checks and 

Peck was free to accept them without the risk of discharging his claim. 

Therefore, the tender of $20,089.60 for bin rent was unconditional and the award 

of interest on this amount was improper. See Zidlicky, 426 N.W.2d at 391.

The parties did have a dispute, however, over the nature of their land 

rental agreement. Peck had already rejected the 2010 “bonus” payment offered 

by Four Aces on the basis that it was not properly calculated. Peck’s letter 

instructing Four Aces not to market any of Peck’s grain was at direct odds with 

Four Aces’s contention that the leases had no crop share component.

The existence of an accord and satisfaction is generally a question for the 

trier of fact. See Perin v. Cathcart, 89 N.W. 12, 13 (Iowa 1902). We conclude a 

reasonable trier of fact could have found the letter and accompanying 

payments—had they been accepted—constituted an accord between the parties 
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discharging Peck’s claim against Four Aces. See Seidler v. Vaughn Oil Co., 468 

N.W.2d 474, 478 (Iowa 1991) (remanding to determine if plaintiff “knew or should 

have known” that accepting a check with “Full, Final Settlement for Damages”

written on it was intended as a release of claims against the defendant); Perin, 

89 N.W. at 13 (stating an accord and satisfaction “need not be express, but may 

be implied from the circumstances”). The tender of payment for the rental 

amounts, therefore, was conditional and did not preclude an award of interest 

See Zidlicky, 426 N.W.2d at 391. We therefore affirm the district court on this 

issue of awarding interest.

We determined above that the rental amounts Four Aces owed to Peck 

totaled $101,439.60 and that Four Aces was entitled to a set-off of $20,429 for 

the stover. The parties do not challenge the district court’s set-off of $461.90 to 

Four Aces for a bin motor repair. Reducing the $101,439.60 by the two set-offs, 

Peck is entitled to $80,548.70. The district court’s declaratory ruling and 

judgment should therefore be modified to reduce the amount subject to the

interest award to $80,548.70.

VII. Conclusion

In accordance with the above opinion, we modify the district court’s 

declaratory ruling and judgment as follows: (a) the awards to Peck of $19,218.14 

for 2010 crop share and $94,090.74 for 2011 crop share are deleted, (b) the 

amount of set-off to Four Aces for the crop stover from the 2011 crop is 

increased to $20,429, and (c) the amount subject to interest is reduced to
23

$80,548.70. We affirm the district court’s declaratory ruling and judgment in all 

other respects. Costs of the appeal are taxed to Peck. 

AFFIRMED AS MODIFIED.