Form of agricultural contract – verbal contract

The lease agreement, governed by Law no. 203 of 1982, is not among the contracts for which under Article 1350 of the Civil Code the written form is mandatory for the existence and validity of the contractual relationship: it can be concluded between the parties either in writing or in oral form.

For the purposes of the Agricultural Legislation, therefore; agrarian leases can also be made orally and are perfectly valid

It should be kept in mind, however, that the contract in question should be considered to be subject without possibility of derogation to all the rules stipulated in Law no. 203/1982. Therefore, should the parties wish to deviate from the provisions stipulated in the aforementioned law, written form is essential. In addition, the parties must be assisted by their respective professional associations whose representatives must intervene in the contract “in derogation,” as required by Article 45 of Law No. 203/1982.

In the absence of these requirements (and in particular the assistance of farmers’ associations), the rules of the law supersede any deviating clauses agreed upon by the contracting parties, so that the term of the contract must be considered fifteen years, as stipulated in Article 1 of the law. Which means that at least one year before the expiration of the fifteen-year period, the grantor can give notice of termination to the tenant. In the absence of termination, the contract, whatever the verbal agreement of the parties, will be renewed for another fifteen years.

Turning to a brief analysis of the effects of the verbal contract in the matter of the granting of public PAC-PSR subsidies and the granting of Facilitated Fuel, it seems essential to note that, in the hypothesis of a lease contractual relationship concluded verbally between the grantor and the tenant, and the completion of the forms provided for the fulfillment of the obligation of registration of the aforementioned contract, consisting in the submission at the competent Financial Offices of a simple unilateral registration application, does not transform the verbal lease into a written lease: the possibility of concluding the lease verbally continues to apply, even after the entry into force of the obligation to register leases, as, moreover, reaffirmed by the judgment Cass., sec. III, May 18, 1999, no. 4804.

In any case, it is necessary to reiterate that the fulfillment of the tax obligation of registration through the use of the unilateral declaration presupposes that the declarant-which is usually the tenant-has obtained the consent of the other party to the lease relationship, and only as a result of the consent thus expressed can a rustic land lease be said to be perfected.

Moreover, confirming the above, Article 41 of Law no. 203 of 1982, by not prescribing the written form even for contracts of lease of rustic land for more than nine years, which it considers to be valid “even if they are verbal or not transcribed,” and expressly stating that they “shall also have effect with respect to third parties,” is based on the principle that freedom of form is a rule in agricultural contracts, for which no exceptions of any kind are justified.

It follows from the foregoing that the demonstration vis-à-vis third parties, public or private, of the conduct of the fund by way of lease when it does not result from a written contract may be made by the production by the interested party of a declaration in lieu of affidavit made pursuant to Article 47 of Presidential Decree No. 445 of 2000, certifying the existence of the relationship, without prejudice to the declarant’s assumption of criminal liability as to the truthfulness of the statement.

Attorney Chiara Roncarolo

Attorney Maurizio Randazzo