student learning objectives - missouri ffa and agriculture ... contracts/… · web viewslide 4...

AM4

Agriculture Management, Economics, & SalesContracts

Unit: Agribusiness Management

Lesson Title: Contracts

Standards ABS.02.01.02.a. Identify and observe ethical standards in planning and operating AFNR businesses.ANS.07.02.02.b. Examine legal and industry requirements for a production facility.CS.02.04.01.c. Demonstrate critical and creative thinking skills while completing a task.CS.02.05.05.a. Describe situations where seeking counsel would be appropriate (e.g., personal, legal, financial, etc.)CS.02.05.05.b. Analyze the positive outcomes of seeking counsel through an appropriate source.

CCSS.ELA-Literacy.W.11-12.3 Write narratives to develop real or imagined experiences or events using effective technique, well-chosen details, and well-structured event sequences.CCSS.ELA-Literacy.SL.11-12.1 Initiate and participate effectively in a range of collaborative discussions (one-on-one, in groups, and teacher-led) with diverse partners on grades 11–12 topics, texts, and issues, building on others’ ideas and expressing their own clearly and persuasively.

Student Learning Objectives

Slide 2 in AM4 Contracts Lesson ObjectiveAfter completing the lesson on contracts, students will demonstrate their ability to apply the concept in real-world situations by obtaining a minimum score of 80% on an SAE Ownership Contract.

Enabling ObjectivesAs a result of this lesson, the student will…

1. Define contract, identify three things to consider when making a contract, and identify three legal aspects of contracts.

2. Describe a lease and the relationship between the two parties involved and weigh the lessee’s advantages and disadvantages to leasing.

3. Justify the need for an automatic renewal clause and explain how to use arbitration.4. Contrast a cash lease with a production share lease; identify and define three types of

leases.

Time: Approximately 185 minutes

List of ResourcesAmerican Academy of Pediatrics. (n.d.). Parent-Teen Driving Agreement. Retrieved

from http://www.cdc.gov/ParentsAreTheKey/pdf/Parent_Teen_Driving_Agreement-a.pdf.

Bacon K., Boren N., Kirkwood V., Birkenholz R., Plain R., Rohrbach N. (1988). Agriculture Management and Economics Instructor Guide. Columbia, MO: Instructional Materials Laboratory.

Bacon K., Boren N., Kirkwood V., Birkenholz R., Plain R., Rohrbach N. (1988). Agriculture Management and Economics Student Reference Guide. Columbia, MO: Instructional Materials Laboratory.

Blumberg Excelsior Publisher. (1987). Apartment Lease. Retrieved from http://www.mns.com/pdf/stabilized_rental.pdf.

Jobes R., Steward J., Casey J., Bangert L. (2011). Farm Business Management Student Guide. Moline, IL: John Deere Publishing.

LEASE: BASIC RENTAL AGREEMENT OR RESIDENTIAL LEASE. Retrieved from http://www.dca.ga.gov/housing/specialneeds/programs/documents/C-2SampleLEASE.pdf.

Manis, C. (2011). Student Behavior Contract. Retrieved from http://www.dailyteachingtools.com/classroom-behavior-management.html#15.

Manis, C. (2011). Student Behavior Contract. Retrieved from http://www.dailyteachingtools.com/classroom-behavior-management.html#16.

Robert A. Pierce, R., Moore, K., Matthews, S. (2008, July). Landowners' Guide to Lease Hunting in Missouri. Retrieved from http://extension.missouri.edu/p/G9420.

List of Tools, Equipment, and SuppliesAM4 PowerPoint PresentationAM4 Activity Sheet and Evaluation PacketNote cards or small sheets of paper for review activityHighlighters or colored pens for review activity

Agribusiness Management AM4 Contracts

AM4 Land LeaseAM4 LeaseAM4 Real Estate ContractAM4 Rental Lease AM4 Teenage Driving ContractOwnership Business Agreement Form 100

Key Terms. Slide 3 in AM4 Contracts

The following terms are presented in this lesson (shown in bold italics):ContractLeaseArbitration LesseeLessor


Interest Approach: Use an interest approach that will prepare the students for the lesson. Teachers often develop approaches for their unique class and student situations. A possible approach is included here.

Slide 4 in AM4 Contracts Is This Binding? Print copies of the sample leases and contracts included with this lesson. Hang these in various places around the room, numbering each lease/contract for students to easily identify during discussion.

Next, give students a copy of AM4.1 where they can write notes and comments about the contracts and leases they are viewing. Before sending them on their gallery walk, introduce to them that contracts come in various forms. As they browse around the room, encourage them to jot down their initial thoughts and notes about each contract. Consider things like: Would this hold up in court? Is it legal? Is it binding? Is it a real contract? If not, what entails a “real” contract? Etc.

After students have visited each contract in the gallery, bring them back for a class discussion, examining each contract/lease individually. Begin with the “lesser” of contracts and move to the rental agreements and land contract. Use the questions above to facilitate discussion.


Alternative to Interest Approach: Find contract examples used in your school. Many school handbooks have an attendance contract, behavior contract, athletic participation contract, etc. Record book contracts on page 100 and 101 of the Missouri Record Book could also be printed

and added to the gallery walk. Summary of Content and Teaching Strategies

Objective 1: Define contract, identify three things to consider when making a contract, and identify three legal aspects of contracts.

Teaching Strategies Related Content1. Ask students how they would define a contract and what elements they think should be included within a contract.

Slide 5 in AM4 Contracts


2. Before writing a contract, there are a few things to consider.


3. There are a number of legal aspects to contracts.


Contract Verbal agreement or formal written

document that is legally binding between two or more people or businesses

Used to help reduce risk by agreeing on terms and conditions beforehand

Elements of a contract Two or more legal parties – Must have

legal capacity to act Offer and acceptance – An offer or

proposal made by one party and accepted by the other

Sufficient consideration – Promise of each party to fulfill contract

May not offend public policy or morals – Contracts cannot involve unlawful or immoral acts

Making contracts Consider legal aspects Insure economic gain for both parties Agree on what records will be kept and

who will keep them Determine how differences in opinion

will be resolved Determine who has responsibility for

what jobs or enterprises Agree on the responsibility for

maintaining buildings, facilities, and land fertility

Agree upon how compensation for improvements will be handled

Legal Aspects


Legal advice Written contracts – May be NO more

binding than oral contract if not written properly; May help avoid misunderstandings

Details of a contract – Statement of who furnishes what; Statement of who pays for what; Payment of rent – Terms of payment, including beginning and end dates, Division of Income; Restrictions; Method of ending contract

Objective 2: Describe a lease and the relationship between the two parties involved and weigh the lessee’s advantages and disadvantages to leasing.

Teaching Strategies Related Content1. Ask students what they know about leases. Sift out incorrect information to keep students on track with the difference between a lease and a contract.


2. Facilitate a discussion on what can be leased, the advantages over buying, and the disadvantages over leasing (cars, houses, etc.)


Lease Common type of contract Farm contract transferring use or

occupancy of land, buildings, machinery, or equipment for some form of payment

May be written or verbal Rent – Income received from leasing

property Lessee – Tenant; One who holds or has

the use of property that is owned by another

Lessor – Landlord; Owner of leased property

Lessee’s advantages in leasing Financial – Lower fixed cost, more

capital available, rent considered a business expense so deducted from income for tax purposes, no taxes paid on leased property

Risks of obsolescence and faulty property shifted to lessor

Timing – When use is only occasional; When capital expenditure is large

Lessee’s disadvantages in leasing Financial – Limited borrowing


potential because leased equipment cannot be used as collateral; No gain from leased land appreciation

Possible higher rental payments resulting from risks transferred to lessor

Objective 3: Justify the need for an automatic renewal clause and explain how to use arbitration.

Teaching Strategies Related Content1. Ask students when a contract expires,

how it is extended, etc. to facilitate discussion on what they know about specifics on contract deadlines, renegotiations, etc.


2. Contracts deal with two or more parties, and there is always risk of a conflict. How would this be solved?


Automatic renewable clause Allows a short-term lease to be

continued under the same conditions unless either the lessor or lessee notify the other party before a given deadline

Less renegotiation time, and neither party is locked into a long-term lease

Arbitration Method of settling differences between

two or more parties Lessor can select a member of an arbitration committee; Lessee can select one; Two arbitrators select one; Except for questions of law, decisions of the committee are final and binding to the lessor and lessee

Objective 4: Contrast a cash lease with a production share lease; identify and define three types of leases.

Teaching Strategies Related Content1. Have students recall the definition of a lease. Next, facilitate a discussion on what they think would be the difference between a cash lease and a production share lease.


Cash lease vs. production share leaseCash

Lessee pays a fixed amount of money for the use of an item for a set amount of time

May be used for land, livestock, machinery, equipment, and buildings

Production share lease Lessee pays a share of the product


2. Let’s dive into the different types of leases. Divide students into groups of 4. Have each group member number 1, 2, 3, and 4. Gather all 1s, 2s, 3s, and 4s in groups around the room. Give each student in the group a copy of AM4.2 and each group one page from AM4.3. Students will do a jig saw activity where they will become experts in their particular field area, taking notes on important concepts from the reading. When all groups are finished, individuals will return to initial groups and “teach” their classmates about their type(s) of lease(s). Remind students when they teach, they should not simply let students copy the notes off their papers.

3. Slides on the PowerPoint presentation can be used as a review device if needed.

Slide 14-18 in AM4 Contracts

produced with the leased property

Types of leases Land lease – Used when tenant rents

land and pays landlord with cash; Tenant furnishes labor, management, machinery, livestock, and operating expenses; Tenant benefits because there is less capital required to operate the business; Less capital needed for land means more can be used for machinery and equipment; Expand business and lower fixed costs per acre; Landlord may also furnish buildings and some management in certain cases; Landlord benefits with fewer risks and a guaranteed income; Landlord is at a disadvantage because there is a lower income with less control of land; Rent may be difficult to collect if crops fail

Crop share lease – Percentage of crop given as payment for use of land; Used by people entering or expanding in production agriculture without a large amount of capital available; Landlord may furnish buildings, a portion of management, and a percentage of expenses; Landlord benefits by more opportunity for supervision of land; Value of rent more accurately reflects the value of the land because rent is based on proportion of the crop; Tenant furnishes labor, machinery, equipment, part of management, and any operating expenses not covered by landlord; Tenant benefits with less operating capital needed; Landlords more likely to make improvements because they are involved in what is happening; Less risk to tenant if crop fails because landlord shares some of risk

Livestock share lease – Lessor receives percentage of livestock from lessee as payment for use of livestock; Lessor furnishes land, buildings, percent of livestock, part of management, and part of operating expenses; Lessee provides


4. Now that students have a grasp of the types of leases above, let’s help them explore other types of leases. Use the PowerPoint slide to explain the task.


To the right is an example of the information students should find about each type of lease.

labor, machinery, part of livestock, part of management, and percentage of operating expenses; Lessee’s risk is less with payments based on production of livestock enterprise

Financial lease – Item is purchased by lessor and used by lessee; Lessee pays monthly or annual rental fees; Lessee can use item without making a large down payment, reducing capital requirements; Lease often contains an agreement giving lessee option of buying item at a set price at end of lease

Building and machinery lease – Buildings are usually cash leased; Machinery rentals may be cash or production share leased; Can be a financial lease – one year, or an operating lease – for an extended period; After life of lease, option to buy exists

Hunting lease – Agreement between land owner and someone wanting to use the land for recreation; Lessor grants lessee access to hunt game for a specified period of time; Price paid per acre or per hunt; Leases choose to rent hunting ground because they perceive there to be less competition from other hunters, more abundant game, a safer environment due to a controlled number of hunters, convenience of location; Hunting leases can be for any number of acres; Lease cooperatives can be formed between multiple small-acre land owners to provide a bigger area for lessee; Types of hunting leases – Annual lease – Most common, covers all species “in season”; Limited-duration lease – Seasonal lease, for a particular hunting season; Short-term lease – daily, weekend, or week-long hunts

Windmill lease


Coal lease Oil lease Mineral lease

Review/SummarySlide 20 in AM4 Contracts

Contracts are very important in agriculture. They can be written or verbal. Leases make up the largest number of contracts in agriculture. In larger contracts, it is advisable to have a lawyer examine the contract to make sure it is fair. Leases contain certain advantages and disadvantages that will be unique to each person’s own situation.

Review: Finding Each Piece: Take a look at AM4.4, AM4.5, and AM4.6, having students examine three types of contracts/leases. For each contract/lease, have students identify (by highlighting or circling in a colored pen) each specific part of the contract as mentioned in Objective 1 and Objective 2. This may be done in small groups, as partners, or individually.

Slide 21 in AM4 ContractsExit cards: Students will answer the following questions on a note card or a small slip of paper and hand to teacher as they exit:

What did you learn today about contracts? What questions do you still have about contracts?

Application

Extended ActivitiesCreate an FFA Member Contract for local FFA members. Visit with chapter officers and the advisor to determine what should be included in the contract. As a class, in small groups, or as partners, create this contract and present to FFA officers and the advisor for review. If appropriate, present to the local FFA chapter and adopt the contract to use next year.Invite a local lawyer to the class to discuss the importance of contracts, things to include in contracts, things to look out for before signing a contract, etc. Have each student create 5-8 questions. At the conclusion of the class discussion, students will each create five hashtags relaying the key messages they obtained from the lawyer’s answers to their questions.

Complete the Supervised Agricultural Experience Ownership Business Agreement Form 100 of the Missouri Record Book. If already complete, review documents and update if needed.


EvaluationSAE Ownership Contract AM4.7

Alternate - Paper-pencil Quiz Evaluation AM4.8

Answers to EvaluationEvaluation AM4.7Answers will vary. Use scoring guide on AM4.7 to assess student work.

Alternate Evaluation AM4.8 1. C2. D3. C4. E5. A6. B7. D8. The automatic renewable clause reduces negotiation time between leasing periods

without locking either party into a long-term lease. Either party can terminate that lease for the next period by notifying the other party before a set deadline. If no one says anything, then the lease automatically continues.

9. Arbitration is a method for settling differences between the landlord and tenant. Each party selects a member for an arbitration committee. The two people selected choose a third person. This committee then decides how to settle the problem. Their decision is binding unless it is in conflict with the law.


student learning objectives - missouri ffa and agriculture ... contracts/… · web viewslide 4...

Documents