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WITH the price of milk, cereals and other agricultural commodities rising there is a perception that farm profitability is increasing. This has inevitably led to an increase in the number of rent review notices served by landlords seeking an uplift in rent.

"The calculation of rent payable depends on the type of tenancy under which the land is held," says Mark Neason of Stags Exeter office. "Either The Agricultural Holdings Act (secure tenancy or AHA) or The Agricultural Tenancies Act (Farm Business Tenancy or FBT)."

Rent review procedures under each agreement differ, the rent under a secure tenancy is related to the profitability of the holding whereas under a FBT the rent is the amount being tendered for similar land currently available.

"Differences between ways of calculating rent mean that under current market conditions the same piece of land is likely to be cheaper to rent under a secure tenancy than an FBT," he added.

Although legislation provides a helpful framework for negotiations landlords or tenants should be aware of strict deadlines for serving notices, these are related to the start date of the tenancy.

"If someone forgets the relevant date they can find themselves waiting for two years before the rent can be reviewed, whatever the market," he said.

Although legislation is in place to govern landlord and tenant's rental negotiations, within agriculture the situation is often complicated by social linkages between the parties Mr Neason adds: "Apart from our professional knowledge of the rules, we are often asked to act for either landlord or tenant in order to provide a cushion between parties."

The outcome should be fair and, if possible, the relationship between landlord and tenant should not be compromised by the negotiations.

Often a rent review negotiation is the trigger for other changes in the agreement either by accident or as part of an overall strategy.

Jo Maynard of Stags Truro office said: "We often end up agreeing other issues such as diversification, tenancy end dates, treatment of Single Farm Payment entitlements and improvements to the holding. The important thing is to consider everything in the round' and if appropriate use the rental negotiations to achieve other ends."

As would be expected financial assistance for landlords is limited. However, tenants who are members of the NFU can benefit from the Tenants First Advice Service' which is designed to cover initial professional advice in response to a landlord's notice.

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