Boneta Foods et al. v Ontario Vegetable Growers’ Marketing Board, 1997 ONAFRAAT 35

Agriculture, Food and Rural Affairs Appeal Tribunal 1 Stone Road West

Tribunal d’appel de l’agriculture, de l’alimentation et des affaires rurales 1 Stone Road West

Guelph, (Ontario) N1G 4Y2 Tel: (519) 826-3433, Fax: (519) 826-4232 Email: AFRAAT@ontario.ca

Guelph (Ontario) N1G 4Y2 Tél.: (519) 826-3433, Téléc.: (519) 826-4232 Email: AFRAAT@ontario.ca

Boneta Foods et al. v Ontario Vegetable Growers’ Marketing Board

Boneta Foods et al. v OVGMB 1997 ONAFRAAT 35

Ministry of Agriculture, Food and Rural Affairs Act

August 20, 1997

DATE OF DECISION:

September 4, 1997

1997-35

1997 ONAFRAAT 35

Boneta Foods et al. v Ontario Vegetable Growers’ Marketing Board

IN THE MATTER OF THE FARM PRODUCTS MARKETING ACT AND SECTION 16 OF THE MINISTRY OF AGRICULTURE AND FOOD ACT.

An Appeal to the Farm Products Appeal Tribunal by 1037020 Ontario Limited (Boneta Foods) and Mr. Robert Meersseman from a June 13, 1997 decision of the Ontario Vegetable Growers’ Marketing Board denying Mr. Robert Meersseman a licence to produce and market vegetables for processing for the 1997 crop year and from a July 15, 1997 decision of the Farm Products Marketing Commission denying 1037020 Ontario Limited (Boneta Foods) a license for processing vegetables in 1997.

Before:

Mr. Jim Rickard, Chair; Mrs. Anna Andres, Member; Mrs. Moira Connell, Member; Mrs. Karen Ratcliffe, Member.

Appearances:

Mr. Paul Courey, counsel for the appellant, Boneta Foods and Mr. Meerssseman.

Mr. Meersseman, appellant in person.

Mr. Robert Wilson, counsel for the respondent, the Ontario Vegetable Growers’ Marketing Board.

Mr. John Mumford, general manager, Ontario Vegetable Growers’ Marketing Board.

DECISION OF THE BOARD

This matter was heard in Guelph, Ontario on August 20, 1997. This was an appeal to the Farm Products Appeal Tribunal (the Tribunal) by 1037020 Ontario Limited (Boneta Foods) and Mr. Robert Meersseman from a June 13, 1997 decision of the Ontario Vegetable Growers’ Marketing Board (OVGMB) denying Mr. Robert Meersseman a licence to produce and market vegetables for processing for the 1997 crop year and from a July 15, 1997 decision of the Farm Products Marketing Commission (FPMC) denying Boneta Foods a license for processing vegetables in 1997.

The Farm Products Marketing Commission takes no position and thus did not appear before the Tribunal.

Preliminary Issues

Mr. Courey, counsel to Boneta Foods and Mr. Robert Meersseman, objected to the entering of letters from the Ontario Tomato Seedling Marketing Board and Heritage Foods as this is evidence presented to the Tribunal and the parties do not have the opportunity to cross examine. Mr. Rob Wilson, counsel to the respondent the OVGMB, argued that material filed with the Tribunal should be considered. The weight the Tribunal gives to these documents should be less if the parties are not at the hearing to be cross examined.

The Background

Boneta Foods processes primarily tomatoes and employs 26 people directly and indirectly about another 25.

In making their decisions, the OVGMB and the FPMC used the General Regulations - 1996 made under the Farm Products Marketing Act. Pertinent sections are listed below.

In these regulations

(a) "contract" means an agreement, oral or written, between a producer and a processor for the purchase and sale of vegetables produced in a crop year;

(c)"processing" means,

(ii) entering into a contract for the purchase of vegetables for the purpose of performing on the vegetables any of the operations mentioned in subclause (a);

(a) Every producer who,

(i) is named on the processors’ contracting report filed with the local board in accordance with Section 17.(a)

(ii) has not been given notice by the local board pursuant to Section 23,(a); and

(iii) is not in default of payment of licence fees prescribed by Section 19 shall be deemed to be holder of a licence to produce and market the vegetable in accordance with the term contract between the producer and the processor.

(b) Every producer who is named on a contract filed with the local board, in accordance with Section 17.(b) may be issued a licence, in accordance with Section 24, under such terms and conditions and the board considers proper, to produce and market the vegetable, in accordance with the contract between the producer and the processor, and such contract may not be considered a term contract at the discretion of the local board.

(a) Every processor shall file with the local board on or before the 15^th day of May, 1997 at its head office, 435 Consortium Court, London, Ontario, N6E 2S8, in respect of each vegetable, either:

(i) a true copy of every contract entered into between the processor and each producer on or before the 1^st day of May, 1997; or,

(ii) a list of every producer with whom the processor has entered into a contract on or before the 1^st day of May, 1997, including the name, address, telephone number and the volume contracted as specified in column 3 of Appendix A.

(b) Every processor shall file with the local board at its head office, 435 Consortium Court, London, Ontario, N6E 2S8, a true copy of every contract entered into with a producer after May 1, 1997.

(a) No charges, costs or expenses relating to the production or marketing of a vegetable shall be made other than such charges, costs or expenses as are provided in the Agreement or Award or renegotiated Agreement or Award in force for the marketing of the vegetable.

The pertinent section of the Agreement for Marketing the 1995 Crop of Tomatoes for Processing between 1037020 Ontario Limited, Boneta Foods Ltd. are as follows:

"Payment Terms

(a) The processor shall pay to a grower 90% of the full amount of the purchase price due and owing the grower for tomatoes delivered from and including the 1^st to the 15^th day of any month on the twenty-fifth day of that same month, and for tomatoes delivered from and including the 16^th day to the last day of the month on the 10^th day of the next following month.

(b) All payments shall be postmarked no later than the due date."

The Issue

The issues for the Tribunal to decide are:

Should the Tribunal reverse the decision of the FPMC and grant Boneta Foods a processor licence?
Should the Tribunal reverse the decision of the OVGMB and grant Mr. Meersseman a licence to produce and market tomatoes?

The Evidence

Mr. Meersseman stated that in 1996 Boneta Foods had some internal management and financial problems. He said that before August 23, 1996, Mr. Hirst of Heritage Foods owned 50% of the common shares and the other 50% were owned by growers that grew for Boneta Foods. Mr. Meersseman testified that he became 98% shareholder of Boneta Foods on August 23, 1996. He said he is currently President and General Manager of Boneta Foods.

Mr. Meersseman told the Tribunal that in order to obtain a licence in 1996, the FPMC ordered that a $25,000 letter of credit be posted. He said when that condition was not met, a licence was not issued. He said at that point the creditors commenced bankruptcy proceedings. He said that Mr. Hirst then left the company and signed off his common shares. Mr. Meersseman said he then called a meeting of all of the growers to discuss restructuring options. He said the growers had the following options: take over the corporation, walk away from the corporation and try to control the amount of liabilities that they would have towards the bank, watch the remainder of the crop rot in the field, exchange common shares in the company plus personal guarantee (that bank held) for preferred shares or let the company go into bankruptcy. He said the company was restructured with him becoming shareholder of 98% of common shares and most of the growers were to convert their income from the 1996 crop to preferred shares in the company. He said the growers were each advised to see a lawyer before signing any forms.

On September 16, 1996, a processor licence was issued to the newly structured Boneta Foods with the qualification of supplying a $750,000 letter of credit. That letter of credit requirement was later reduced to $450,000. He said that once he deposited the letter of credit and received his licence, he applied for a producer licence for those growers with whom he had a verbal agreement in the spring. He said at this point the growers had already lost the early part of their crop which was ready for processing by mid August 1996.

He said he spent the winter of 1996/97 seeking financing at a normal rate because the money he borrowed for the letter of credit in 1996 had been obtained from a private investor at 36% interest rate. He said he did not apply for a processor licence until May 26, 1997 as he was waiting for financing approval so that he could enter into grower contracts. He said that since final financing was not in place by May 26, and it was getting late in the season for planting tomatoes, he applied for a processor licence with himself as sole grower of tomatoes for Boneta Foods. He said that planting tomatoes after June 6 makes for a risky crop in that there is risk of frost by late September. He said that his expectation was that the licence would be issued in two or three days.

He said that in 1997, he was hoping to gain back markets he lost in 1996 as that year he wasn’t able to start processing until September 16. He said that his expectation in 1997 was that there would be no problem obtaining a processor licence because the audit report clearly stated that Boneta Foods had not contravened any rules of the Marketing Agreement and that he believed he acted responsibly in not contracting with outside growers without financing in place. He said he received a letter from the OVGMB, dated April 30, 1997, advising him that Boneta Foods did not have a processing licence and that without a contract with a licensed processor he was not licensed to produce and market tomatoes for processing in 1997.

Mr. Meersseman admitted to the Tribunal that he had planted 200 acres of tomatoes without a grower licence. He said he believed Boneta Foods would be issued a processor licence within three or four days of his application which he filed May 26 and that Boneta Foods would issue him a grower contract. When that didn’t happen it meant he had planted tomatoes prior to being issued a producer licence. Mr. Meersseman said he grows his own seedlings with a projected planting date of May 15 to May 20 and if not planted within that time frame the plants become too large to plant outside. He said he did not apply for a licence any earlier as he was trying to get financing in place.

He said the Board called him to a hearing on June 12, 1997 on the issue of whether or not to issue a grower licence to Robert Meersseman. Mr. Courey raised the objection to the hearing saying that it was conducted improperly in that the Board was prosecutor, judge and jury. The decision of the OVGMB read as follows:

"At the hearing which took place, both you and your legal counsel admitted that you had, in 1997, planted 200 acres of tomatoes for Boneta Foods, an unlicensed processor. The Board also heard evidence relating to violations of the regulations that occurred in previous years and noted that you have been the subject of a producer licence hearing in the past.

After considering the evidence presented at the hearing, the Ontario Vegetable Growers’ Marketing Board has decided not to grant to you a licence to produce vegetables for the 1997 crop year."

Mr. Meersseman said he is now in control of the company and it is his intention to have it continually grow with financing in place. He said he has every intention of abiding by the regulations. He stated that he did not contract with any growers without having 100% verification of financing in place. He said the 1996 auditor’s reports indicates that Boneta adhered to the rules and regulations of the OVGMB. He said that one of the reasons the FPMC stated for not issuing him a processor licence was that he had contravened the payment date provisions of the Tomato Marketing Agreement. Mr. Meersseman said he disagrees with that statement and that he has complied with payments required and Boneta Foods has been audited. Any problems occurring prior to 1996 were dealt with at an earlier hearing and the corporation was already penalised for that. He said he also disagrees with their second reason for denying him a licence as he did properly contract with growers. He said he had contracts in place by September 16, the same date the licence was issued.

Mr. Courey, counsel to Boneta Foods and Mr. Meersseman, said that after the 1996 season auditors for the OVGMB came in and audited the grower accounts. The reports are dated November 26, 1996 and December 19, 1996. He read into evidence the first page of those audits which reads as follows:

"In our opinion, subject to any deficiencies, if any, listed below, the following is true of the processor that we are reporting herein:

The processor has entered into grower contracts that are in accordance with the terms of the Marketing Agreement.
The weights per the grading certificates are being properly summarised by the processor.
The delivered weight per grower is being properly extended by the prices reflected in the Marketing Agreement.
The grower payments are being made on the dates specified in the agreement and any deductions made are approved deductions as per the marketing agreement.

Mr. Courey submitted that nothing in those reports indicates Boneta Foods was doing anything wrong. He said he does not understand how the FPMC can say that Boneta unlawfully contracted in 1996. He said the grower contracts were signed September 16, 1996, the same date Mr. Meersseman filed the letter of credit. In the auditors report, it says that "technically" all growers have been paid. He does not know how the auditor can make that statement as the auditor saw copies of all the cheques on proper dates issued to the growers. He said he thinks the auditor used the word "technically" because the growers agreed to use the monies received to purchase preferred shares in the company. He said the board regulations do not say that a grower has to cash his cheque. In his opinion, Boneta Food’s responsibility is to issue cheques not to ensure they are cashed. He said there is also no rule that says Boneta Foods can’t issue a cheque to a grower and ask that it not be cashed for a while and that there will be a bonus for not doing so.

Mr. Courey said there are three requirements for receiving a processor licence. Two of the requirements are management and facilities. He said that Boneta Foods has experience and facilities and that the FPMC had no prior objection to those points. The third requirement for a licence is compliance with regulations. He said he does not know of any non-compliance item in the 1997 application.

Mr. Gerald Laprise testified on behalf of the appellant. He said he has been a grower for Boneta Foods since 1993. He said he spends a lot of time in the plant and he has seen a lot of improvement over the year where Boneta can double and triple its production. He said he agrees that Boneta Foods has had a problem with finances in the past and that one of the problems was the company structure. He said that given the chance he will grow tomatoes for Mr. Meersseman again.

Mr. Rob Wilson, counsel to the OVGMB, referred Mr. Laprise to a letter he wrote to the FPMC, dated July 8, 1997, indicating that he grew tomatoes for Boneta Foods in 1994, 1995 and 1996 and that he had not be paid to date. In the letter, he also requested that Boneta Foods not be granted a licence until he was paid in full for his tomatoes. In response, Mr. Laprise said he has received a token amount of money and the balance owing has been rolled into preferred shares. He said he has now changed his position and feels it would be best for producers and processor if Boneta Foods is granted a licence.

Mr. Wilson submitted that it is the OVGMB’s opinion that Mr. Meersseman was in charge of Boneta Foods even before the reorganisation in August, 1996. Mr. Wilson entered into evidence copies of letters, contracts and agreements that were signed by Robert Meersseman, as President, Boneta Foods. He submitted that outsiders dealing with the corporation were dealing with Mr. Meersseman.

Mr. Meersseman refuted that evidence saying he was only President of the corporation at that time and was not General Manager. He said he owned only 11% of the common shares. He said he was not making all of the decisions.

On January 24, 1996, a meeting was held between the OVGMB and Mr. Meersseman. At that meeting, Boneta Foods promised to make payments to growers in accordance with the agreement and Mr. Meersseman signed an agreement that Boneta Foods would be in compliance of OVGMB regulations in the future.

Mr. Wilson submitted into evidence a letter from the Chair, FPMC addressed to Mr. Meersseman, Boneta Foods, advising him that his licence had expired March 1997. He also stated that Mr. Meersseman was contacted personally by the Secretary to the FPMC advising him to apply for his processor licence before the growing season.

Mr. Wilson submitted that in 1996, Boneta Foods did not have proper contracts with their producers and thus they were in contravention of the General Regulations - 1996. He said that Mr. Meersseman had oral contracts in place before obtaining a processor licence.

Mr. Wilson stated that in his opinion the auditor’s report indicates severe deficiencies. He said if you read the whole report, and not just part of the first page, you would read about the comments/deficiencies noted by the auditor. He said the first page just explains the breadth of the investigation.

Mr. Doug Lambert, C.A. was called as a witness for the respondent. Mr. Lambert said he has been performing processor audits for the OVGMB for 10 or 11 years. He said that Boneta Foods has a history of non-compliance with OVGMB regulations. Mr. Lambert testified that his audit reports are completed at the request of the OVGMB. He said his job is to note things worthy of comment and let the OVGMB decide whether or not they want to pursue a comment/observation any further. He said that some of the deficiencies noted could be comments and/or observations he has formed. Mr. Lambert said that the four points outlined on page one of his report indicate the specific purpose of his report. He said he audited Boneta Foods on November 26, 1996 and again on December 19, 1996 and concluded that technically the growers were paid, however not in accordance with payment due dates as stipulated in the Agreement.

He said that the regulations state that contracts between a processor and a grower are to be signed and filed with the OVGMB on or before May 15. He said that Boneta Foods did not sign contracts with growers until September 16 and thus were in non-compliance.

In the opinion of Mr. Lambert, preference shares with the attribute of retraction on the part of the Investor are debt share and are recognised as such by the Institute of Chartered Accountants Handbook Generally Accepted Accounting Principles which require that these shares be presented in Financial Statements as a liability and not as Shareholders’ Equity. In Boneta Food’s case, retractable shares were issued and they are liabilities.

Mr. John Mumford, General Manager and Secretary-Treasurer for the OVGMB, testified on its behalf. He said that what is at issue here is the orderly marketing system. He said when a processor is in non-compliance it has a competitive advantage over those processors who are in compliance with the regulations.

He said the OVGMB completes six to eight audits a year. They are conducted randomly unless there has been a history of non-compliance. He said Boneta Foods has been audited four or five years in a row and that the audit is restricted solely to compliance issues. He said that contracts are generally negotiated in late March to mid April and that the processor usually has the grower come in and sign a contract for so many tonnes and specific varieties. Payment terms are negotiated on an individual basis. He stated that the OVGMB regulates the producers and the FPMC has the responsibility to regulate the processors. He said that processors file by May 15 a true copy of every contract entered into between the processor and each producer. He said that in some instances a processor contracts with a grower subsequently. The OVGMB supports the FPMC in its decision to deny Boneta Foods a processor licence as there has been a history of broken commitments and non-compliance.

He said that shipping tomatoes to a processor who offers shares in payment is not in compliance with the Marketing Agreement. He said that the history of this company is that the application for a licence is delayed every year. Each year they claim tomatoes are in the ground and so they have to have a licence. He said that in April, 1997 a letter was sent to all growers advising them that Boneta Foods did not have a processor licence. The OVGMB was advised in June that Mr. Meersseman had applied for a processor and grower licence and that he had planted tomatoes. On June 12, Mr. Meersseman was called to a hearing at the Board office for the purpose of hearing evidence that he had:

(a) engaged in the producing of vegetables without a licence;

(b) engaged in the marketing of vegetables without a licence.

After hearing evidence from Mr. Meersseman, the OVGMB denied his application.

Mr. Mumford said there are three large processors in Ontario who do 85% of the processing. Boneta Foods is considered a small processor. He said there are about 240 tomato growers and 1000 vegetable growers in Ontario. In his opinion, the tomato marketing scheme favours the smaller processor. He said the OVGMB represents the producers and it is there to ensure that producers get paid for their product.

In response to a question of the Tribunal, Mr. Mumford stated that the provincial average for production is 31 tonnes per acre. This would mean that this year Mr. Meersseman’s crop would be worth approximately $500,000. He said the processor and grower determine how many tonnes of tomatoes to plant and process.

Mr. Driedger testified as a witness to the Tribunal. He said his first grower contract with Boneta Foods was in 1996. He said that when he planted the tomatoes Boneta Foods was positive they would be receiving a processor licence in a matter of days and that they would give him a grower contract. When Boneta Foods still didn’t have a processor licence at harvest time, he sought other contracts. He said he was able to source 700 tonnes of tomatoes with other processors and that he was paid for those tomatoes. He said he delivered 500 tonnes of tomatoes to Boneta Foods and has not been paid for those tomatoes. He said he has not been issued preferred shares. However, in cross examination, Mr. Meersseman said preferred shares had been issued but Mr. Driedger had not picked them up yet.

Mr. Andre Cartier was also called as a witness to the Tribunal. He said he has been a grower for Boneta Foods since the onset. He said he has not been fully paid for his 1992, 1993, 1994 and 1995 crop. He said he has not seen any of the preferred shares if indeed any have been issued in his name. In his opinion, it is important that Boneta Foods abide by the rules and regulations. He said that Mr. Meersseman has received a salary from Boneta Foods each year. He said Mr. Meersseman is a good manager. He said he is still owed money for tomatoes plus investments. He said he supports the issuance of a licence to Boneta Foods provided it follows the rules.

Mr. George Hamm also testified as a witness to the Tribunal. He said that he and his son Robert have both grown tomato plugs for Boneta Foods from day one. He said the only year he was paid totally for his plugs was 1994. He said he signed over his common shares and at the time it was suggested he may want to see a lawyer but he made the decision not to. He said he would support the application for a processor licence for Boneta Foods.

In response to questions of the Tribunal, Mr. Meersseman stated that Mr. Hamm has his certificates and Mr. Cartier’s and Mr. Driedger’s are in the office. In response, Mr. Driedger said he is not a preferred shareholder and that he did not sign any releases.

In his summation, Mr. Courey said that the growers for Boneta Foods received payment in 1996 sufficient to meet the Marketing Agreement. In his opinion, what happened before 1996 doesn’t matter. He said that what happened in 1995 and prior are issues that have been dealt with and are not open to be adjudicated again. He said that Boneta Foods had their back against the wall and they had to get creative to survive. In the fall of 1996, Boneta Foods got a processor licence with extraordinarily stiff conditions attached. He said that one month before harvest, the lending institution was going to put them into bankruptcy and so the growers got together and bought into a plan. He said Mr. Meersseman then took charge of the company and that because of him growers got a good portion of crop harvested and had the prospect of getting paid for their crop. He said that all of the growers who testified here today supported the application of Boneta Foods for a processor licence.

Mr. Courey stated that Mr. Meersseman applied for a processor licence for Boneta Foods on May 26, 1997. He fully expected that his licence would be issued in a matter of days so he went about planting his tomatoes. He said the OVGMB did not hold a hearing until June 12 which was too late to plant tomatoes. He said that in his opinion, the OVGMB’s decision is fundamentally flawed and should be struck down as the members and staff acted as prosecutor, judge and jury at the hearing.

In his summation, Mr. Wilson said that whether or not the original hearing before the OVGMB was flawed does not need to be disputed as the Tribunal, under its legislation, is empowered to have a new hearing.

He said that when Mr. Meersseman applied for the processor licence, May 26, it was a very busy time of year for the OVGMB. He said that Mr. Meersseman knew in March that he didn’t have a processor and grower licence and could have forwarded his application sooner. He said the OVGMB cancelled other commitments to schedule the hearing as early as they did. In his opinion, Mr. Meersseman does not have the ability to manage finances. Growers here today testified they are owed money plus preferred shares. Their testimony also indicated that Mr. Meersseman has been very involved in the running of the business all along. He said Mr. Meersseman made the choice to grow the tomatoes without a grower licence.

In his opinion, no new evidence was presented today that would indicate that the FPMC and the OVGMB were wrong in rendering the decision they did.

The Findings

In the opinion of the Tribunal, Mr. Meersseman could have applied for a grower license for himself and a processor license for Boneta Foods when his earlier licenses expired March 31, 1997. When financing was in place, he could then have applied for a processor license for Boneta Foods to process the crops of other producers. In the opinion of the Tribunal, the OVGMB and the FPMC proceeded with reasonable dispatch to process Mr. Meersseman’s applications once he filed them May 26, 1997.

Mr. Meersseman argued that before the reorganization in 1996, he did not have a lot of say in the company operations as he was only an 11% shareholder. Mr. Wilson argued that in his opinion Mr. Meersseman was very involved with the day-to-day operations of Boneta Foods even before the reorganization. The Tribunal notes that before the reorganization he was President of the company and signed many documents on behalf of the company.

In the opinion of the Tribunal, as President of the company, Mr. Meersseman should have been aware of internal strife and management and financial problems that were occurring.

The Tribunal noted that each of the witnesses who testified before the Tribunal, and who were also growers for Boneta Foods, historically supported the issuance of a processor license to Boneta Foods.

In the opinion of the Tribunal, it is the obligation of the OVGMB’s auditor, when completing an audit, to draw attention to an issue or point out any discrepancies he finds. The Tribunal accepts the evidence of Mr. Lambert and feel that his expertise in processing plants enabled him to spot discrepancies in figures in Boneta Foods’ accounts that would cause him to note that for the Board’s perusal. The Tribunal also accepts the evidence that the first page of the auditor’s report defines the scope of the audit and that the report should be read in its entirety to understand his findings/comments.

The Tribunal accepts the argument than an orderly marketing system means that all players play by the same rules and that the expectation is that all will play by the same rules.

From evidence presented, the Tribunal concludes that Boneta Foods was in non-compliance of the payment terms of the Agreement. Growers were to be paid by the 25^th of the month, for tomatoes delivered from the 1^st to the 15^th, and by the 10^th day of the following month when tomatoes were delivered from the 16^th day to the last day of the month. All payments are to be postmarked no later than the due date. In the opinion the Tribunal, Boneta Foods did make a settlement with the growers but they did not comply with the payment terms and thus were in non-compliance of the Marketing Agreement.

Evidence presented convinced the Tribunal that Boneta Foods has been suffering from poor management decisions and questions the financial stress put on Boneta Foods when they obtained the $450,000 line of credit at extremely high interest rates is just such an example.

Mr. Courey argued that the hearing before the OVGMB was flawed in that members of the OVGMB acted as judge, jury and prosecutor. Mr. Wilson argued that there is legislation in place which gives a marketing board the authority to establish and enforce regulations and that this legislation was developed for the benefit of the industry. The Tribunal was established to provide a check and balance for the industry. He said the legislation establishing the Tribunal states that it is empowered to have a hearing de novo. He argued that whether or not the original hearing was conducted correctly doesn’t need to be disputed as this is a new hearing. The Tribunal accepts the argument of Mr. Wilson.

Decision and Reasons

After careful consideration of all the evidence and submissions before it, the Tribunal decided to:

Uphold the decision of the FPMC to deny Boneta Foods a processor licence for the following reasons:

a) In 1996 Boneta Foods was in non-compliance of the payment terms of the Marketing Agreement.

b) In the opinion of the Tribunal, poor management and financial decisions continue to plague Boneta Foods.

The Tribunal granted the application of Mr. Meersseman for a licence to produce and market vegetables for processing for the 1997 crop year on the condition that he obtains a contract with a licensed processor for the following reason:

In the past, the OVGMB has granted grower licences to applicants who have applied late in the year. In the opinion of the Tribunal, Mr. Meersseman should be given this opportunity.

DATED at Guelph, Ontario this 4th day of September, 1997.