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  Articles

Save the Farm: Pay Attention to Details

March 14, 2022 | By

Some laws are very forgiving and only require substantial compliance.” Other laws are not so forgiving. A recent Iowa Supreme Court case demonstrates the seriousness of strict compliance” statutes and the great care one must take in deadlines, details, and calculations. Without such care, one might bet the farm” and lose it.

The Iowa Supreme Court reviewed whether a farm creditor, after being assigned the redemption right from the original debtor, was successful in exercising the right of redemption to the foreclosed farmland. Mlady v. Dougan, 967 N.W.2d 328 (Iowa 2021). The Iowa Supreme Court held that the creditor failed to redeem the farmland in time. The Court noted that the right of redemption is purely statutory and must be strictly complied with” for the creditor to successfully redeem the farmland.

But the cause of the creditor’s untimeliness in paying the redemption price is more unnerving than a simple missed deadline. The creditor paid exactly $1,937,001 by the end of the one-year redemption period, which was $1,798.79 (0.09277853%) short of the full redemption price. The correct price of $1,938,799.79 would be calculated with the simple contract interest rate of 21% from the time of default. Since the creditor and her attorney miscalculated the redemption payment, any payment made within the redemption period was insufficient, and subsequent attempts to pay the remaining balance were ineffective.

In summary, details and deadlines are crucial to navigating the law, and a calculator might just save the farm.

Our articles are intended to provide occasional general summaries on new developments in Federal and State law and regulations that we believe might be of interest to our clients. The articles should not be considered opinions of the Heidman Law Firm, P.L.LC. and are not intended to provide legal advice. Readers should not under any circumstance act upon the information in this publication without seeking specific professional counsel. The Heidman Law Firm will be pleased to provide additional details regarding any article upon request. Feel free to contact us at through our website, or by phone at 7122558838.