We had a contract drawn up with an attorney where we leased land to a farmer. The farmer broke all stipulations of the lease. We gave him over 6 months to rectify his terms of the lease and he still did not comply. The lawyer said to terminate the lease. Now, after over a year, the guy is suing us for lost wages for not being able to grow crops! What did we have a contract for in the first place!
It sounds like the farmer is going to lose! If he is suing you, contersue for both a frivolous lawsuit and also for breach of your lease. If it's really that bad and it's totally ridiculous, maybe you should also go after the farmer's attorney and include the attorney in a fraud claim.
To recover damages against him that you deserve! It's always better to have a good contract than to just do verbal agreements, IMHO. I can only wonder what grounds he is suing you. Unfortunately, having a contract doesn't guarantee that your adversary will be rational. It also doesn't guarantee that you won't need to go to court to enforce the terms. Just think of the position you might be in without the paper...