Wayne Parkinson v. Agricorp

In the matter of Ontario Regulation 140/96 under the Crop Insurance Act (Ontario) 1996, S.O. 1996, C. 17, Schedule C.

And in the matter of: An appeal to the Agriculture, Food and Rural Affairs Appeal Tribunal by Wayne Parkinson, Hillsburgh, Ontario from a decision of Agricorp concerning the adjustment of his claim for his 2005 canola crop under Ontario Regulation 380/97 and the Crop Insurance Plan for Grain and Oilseeds.

Before: Kirk Walstedt, Chair; Doug Flook, Member; Euclid Mailloux, Member

Appearances:
Wayne Parkinson, appellant
Fred Thomson, representative of the respondent, Agricorp
John Good, witness for the respondent

Decision of the Tribunal

This appeal was heard on Tuesday, July 22, 2008, in the Tribunal Boardroom, of the Ontario Government Building, at 1 Stone Road West, in Guelph, Ontario.

Opening Statements

Mr. Fred Thompson briefly outlined the circumstances which lead to the Hearing of July 22nd, 2008, in stating that the appeal by Mr. Wayne Parkinson was the result of a serious problem faced by Ontario canola industry in 2005.

The Issue

Is it fair and equitable for Wayne Parkinson to retain payments received from Agricorp, in the claim for his 2005 canola crop, subsequent to receiving retroactive compensation from Woodrill Farms, for this crop?

The Facts

Wayne Parkinson

1. Mr. Parkinson has been a full-time farmer since he was 16 years of age and has been farming canola for approximately the last 30 years. He has been enrolled in the crop insurance program for the last 20 years and, in 2005, he decided to grow canola. Mr. Parkinson owns all of his own equipment and all activity around farming canola has been done by himself and his family. He resides approximately 6 miles from the Marsville elevator.
2. 2005 was a difficult farming year for canola producers. Many crops were harvested with no available market within which they could be sold.
3. Mr. Parkinson delivered a total of four loads of canola from his 2005 crop to Woodrill Farms Ltd. ("Woodrill"), with details as below:
   1. On September 5, 2005, two loads were delivered, weighing 11.114 and 10.050 dry metric tonnes, respectively;
   2. On September 7, 2005, 12.455 dry metric tonnes were delivered; and
   3. On September 23, 2005, 9.826 dry metric tonnes were delivered.
4. The Canadian Grain Commission ("CGC") graded three (3) samples submitted, with details on their respective sample slips (Exhibit 5) as below:
   
   1. On September 9, 2005, a sample was graded "TF Sample Canada AC Heated", with remarks noting "Heated 3.00%";
   2. On September 9, 2005, a second sample was graded "3 Canada", with remarks noting "Heated 0.90%"; and
   3. On September 13, 2005, a third sample was graded "3 Canada", with remarks noting "Heated 1.20%".
5. By letter dated September 21, 2005, (in Exhibit 2) Agricorp contacted Mr. Parkinson with respect to his 2005 canola crop. In this letter, Agricorp stated that:
   1. Customers with "downgraded" and "unmarketable" canola, found to be of "grade three or sample", be sure to follow specific steps, outlined in this letter; and
   2. It "will not accept a regrade" on crops delivered to commercial elevators, and added that "[customers] with grade one and two canola must report their yield by October 31, 2005."
6. By letter dated September 27, 2005, (Exhibit 6) Mr. Parkinson was informed that Woodrill would purchase canola of grading "#1" and "#2", to be delivered to its elevators. In this letter, Woodrill also informed that, upon request by a producer, it would settle canola of grading "#3" and "Sample Grade" at $4.00 per metric tonne.
7. Mr. Parkinson settled his 2005 canola crop with Woodrill on two occasions, with details as follows:
   1. On October 7, 2005, Mr. Parkinson settled 9.826 metric tonnes of canola with Woodrill, at a base price of $23.00 per metric tonne, including GST (Exhibit 8); and
   2. October 15, 2005, he settled a total of 33.619 dry metric tonnes of canola with Woodrill, at a base price of $4.28 per metric tonne, including GST (Exhibit 9).
8. By letter dated August 25, 2006, (Exhibit 17, Tab 5, Page 2) Agricorp informed Mr. Parksinson that since he "received market compensation" for his canola, he was "not eligible for the crop insurance payment of $2851.77" and that his "insurance claim has been readjusted to $0." In this letter, Agricorp informed Mr. Fletcher that they are required to recover this overpayment, and requested that, by September 16, 2006, Mr. Fletcher either:
   1. forward the full amount of overpayment to Agricorp; or
   2. contact an account lead, whose contact information was provided, to make arrangements for repayment.
9. By letter dated October 25, 2007, (Exhibit 17, Tab 5, Page 1) Agricorp requested that Mr. Parkinson pay to Agricorp the amount of the "additional payment instead of the Production Insurance Claim" and requested to meet with Mr. Fletcher to discuss repayment. On November 6, 2007, Mr. Fletcher met with Mr. Barry Roberts, a field manager, and Mr. John Good, an adjuster.
10. By letter dated, January 25, 2008, (Exhibit 15) Agricorp informed Mr. Parkinson of a remaining balance of overpayment for his canola crop, in the amount of $1,441.59, to be repayed to Agricorp by February 29, 2008, in full, or by December 31, 2008, with 12 post-dated cheques sent to Agricorp by February 29, 2008.
11. By letter dated May 23, 2008, (Exhibit 16) Agricorp informed Mr. Parkinson of an "Ontario Risk Management Program" ("RMP") payment due to him, and further informed of a "Duplicate 2006 Red Spring Wheat payment" sent to him, in the amount of $8,884.26. This letter indicated that Mr. Parkinson's outstanding balance owing to the Production Insurance program was in the amount of $8,014.64.

Mr. Parkinson submitted to the Tribunal a document from Agricorp's web site, entitled "Web Reports", dated October 3, 2007, (Exhibit 2) and directed the Tribunal's attention to the 2005 crop year. He added that in August of 2005, he was informed of an upcoming problem with canola and he brought samples to Woodrill on September 5, 2005. This was the first time he realized he had a problem, he stated. He further added that, at the time of delivery, two samples were taken from each load and sent to the CGC for testing, as per Exhibit 5.

Mr. Parkinson told the Tribunal that after receiving the sample grading slips from the CGC, he contacted Mr. John Taylor at Woodrill, who informed him that a conference call had taken place between grain elevators, and was also informed that no elevator in Ontario would be accepting any more canola. He stated that, after receiving this information, he contacted Mr. John Good, who told him to harvest the canola even if there was no market present. The remaining load, he added, was held in a trailer until October.

On September 23, 2005, after receiving the letter in Exhibit 2, Mr. Parkinson stated that P & H started purchasing canola, and his canola was one of the first ones to move, of which, 9.826 tonnes were sold, as per Exhibit 8. He added that he also settled 33.619 tonnes of canola, as per Exhibit 9, and that after this settlement he no longer owned any of the canola. On October 26, 2005, Mr. Parkinson stated, he met with Mr. Good and completed a Proof of Loss form at that time, and later received a cheque from Agricorp for his 2005 canola crop, dated November 4, 2005 (Exhibit 10).

Mr. Parkinson told the Tribunal that in September of 2006, he had a winter wheat claim with Agricorp, which was investigated and approved by Mr. Good. By letter dated February 1, 2007, (Exhibit 12) he stated that he was informed of an outstanding cheque, dated September 19, 2006, that was about to expire. He added that he immediately contacted Agricorp to inform that no payment had been received, and followed up by fax dated February 9, 2007 (Exhibit 13). He further added that throughout 2007, he received no information about the status of the missing cheque. On November 16, 2007, Mr. Parkinson stated, Mr. Barry Roberts and Mr. Good met with him and explained that the missing cheque for the winter wheat claim had been retained as a partial repayment for the canola matter.

After receiving the letter from Agricorp, dated January 25, 2008, (Exhibit 15), Mr. Parkinson told the Tribunal that he received his AG1 tax form from the federal government, which showed the payment of his winter wheat claim, which he never received. He added that his 2005 Canadian Agricultural Income Stabilization (CAIS) claim was being delayed because his income on Revenue Canada's records were not correct by CAIS calculations.

With respect to Exhibit 16, Mr. Parkinson told the Tribunal that it is possible he received a duplicate cheque, although other than this letter, he has not been informed of anything.

In response to questions from Mr. Fred Thompson, Mr. Parkinson told the Tribunal that:

• Woodrill made an error by issuing an additional payment to producers, which creates an uneven field with other producers in the province;
• Since the additional payment was an error, he was obligated to repay it, and has been in touch with Woodrill on this matter;
• He feels that Woodrill should receive the additional payment to producers in return, and does not feel entitled to keep the additional payment;
• He would be willing to repay the additional payment received, to Woodrill, and only receive compensation for his 2005 canola crop from Agricorp;
• Following the receipt of the letter from Woodrill, dated September 27, 2005, he decided to settle his canola;
• A grading had not been assigned to his canola at the time of delivery;
• In November of 2005, Mr. Parkinson received a full production claim for his 2005 canola, in the amount of $35,023.79, and subsequently received an additional payment from Woodrill in the amount of $5,186.74;
• The additional payment received from Woodrill was not received by cheque, but as a payment on account and he wasn't aware of that payment for a period of weeks;
• He believes that the additional payment from Woodrill was based on the number of tonnes delivered;
• The amount received from Agricorp, as outlined in Exhibit 10, represents a full production claim for his 2005 canola;
• He did not pay the "overpayment owing" of $1,441.59, to Agricorp, as outlined in the letter from Agricorp dated January 25, 2008;
• He had previously forgotten about the cheque for $3,745.15, for his winter wheat claim;
• In 2006, he had a claim with Agricorp for his red spring wheat. After submitting this claim, he recalls receiving two cheques roughly 10 days apart, but does not recall what they were for;
• He does not recall receiving the letter from Agricorp, dated May 11, 2006, on Page 3 of Tab 5, in Exhibit 17;
• Agricorp's letters of January 25, 2008, and May 23, 2008, (Exhibits 15 and 16, respectively) are clear on Agricorp's position on this matter; and
• The meeting with Mr. Roberts and Mr. Good, on November 6, 2007 was to review the circumstances of the 2005 canola overpayment.

In response to questions from Mr. Thompson and the Tribunal, Mr. Parkinson stated that:

• Woodrill should receive the additional payment it made, in return, in order to have all 17 grain elevators in Ontario on an equal field; and
• He does not feel entitled to keep the additional payment received from Woodrill.

The Findings

After reviewing the submissions and hearing the oral evidence of Mr. Parkinson, the Tribunal finds that:

1. There is no dispute with respect to the chronology of events that took place during the 2005 canola crop season.
2. The problem with canola crop adjustment, for the crop in question, originated with the grading of this crop, and that once the crop was deemed marketable, Woodrill shared its increased revenues from the regraded crops with its producers.
3. The appeal by Mr. Parkinson is without merit, because:
   1. Mr. Parkinson, through his own oral evidence, stated that he is not entitled to keep the additional payment received from Woodrill, and wants to return this payment to Woodrill; and
   2. It is beyond the jurisdiction of the Tribunal to order the repayment to Woodrill farms of money they sent to Mr. Parkinson for his 2005 canola crop as the parties to the appeal are only Mr. Wayne Parkinson and Agricorp.
4. The confusion within the 2005 canola market, which lead to the matter under appeal, could have been avoided with a grading system that is more conclusive and unambiguous.

Order of the Tribunal

After careful consideration of the evidence filed and submissions made, the Tribunal orders that the appeal by Wayne Parkinson with respect to his crop insurance claim for his 2005 canola crop, be denied.

Dated at Maidstone, Ontario, this 25th day of August, 2008.