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
AGRICULTURE, FOOD AND RURAL AFFAIRS APPEAL TRIBUNAL
APPEAL:
O’Neil v Agricorp
O’Neil v Agricorp 1997 ONAFRAAT 36
STATUTE:
Crop Insurance Act
HEARING:
August 22, 1997
DATE OF DECISION:
September 11, 1997
1997-36
NEUTRAL CITATION:
1997 ONAFRAAT 36
O’Neil 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 Crop Insurance Appeal Board by Mr. Dan O’Neil, R.R.#4, Denfield, Ontario, from the decision of the Crop Insurance Commission of Ontario (now called AgriCorp) to deny him a claim under Regulation 232, Crop Insurance Plan for Oil Seeds.
Before:
Mr. Andrew Wright, Vice-Chair; Mr. Edward Mailloux, Vice-Chair; Mr. Doug Flook, Member.
Appearances:
Mr. & Mrs. Dan O’Neil, appellants in person.
Mr. Frank Murphy, counsel for the appellants.
Mr. Peter Ilnyckyj, on behalf of the respondent, AgriCorp.
Mr. Peter Wechselmann, counsel to the respondent.
DECISION OF THE BOARD
This matter was heard at Guelph, Ontario on August 22nd, 1997.
At the outset of the hearing, the Crop Insurance Appeal Board (the Board) was advised that there were two preliminary motions to be argued.
Mr. Peter Wechselmann, counsel to AgriCorp, wished to challenge the Board’s jurisdiction to hear this matter. Mr. Murphy, counsel to the appellants, sought an adjournment in order to compel the attendance, by summons, of a witness.
The Board heard the submissions of Mr. Wechselmann and Mr. Murphy, in that order, and retired to consider the matters.
While considering these preliminary submissions, a summons was prepared and Mr. Murphy made inquiries as to the availability of the witness. Upon the resumption of the hearing Mr. Murphy informed the Board that his witness was prepared to appear in the afternoon on the strength of the summons and, on that basis, Mr. Murphy withdrew his request for an adjournment.
At the resumption of the hearing, the Board gave a decision acceding to Mr. Wechselmann’s preliminary motion and dismissed the appeal. The following represents an elaboration upon the reasons given orally at the time of the hearing.
The Board received no evidence and Mr. Wechselmann’s submissions were based on agreed facts. Unfortunately, there was no written agreed statement of facts which the Board would have preferred. However, in the course of the exchanges between counsel and the Board, the following were the agreed facts settled upon for the purposes of the preliminary motion:
The appellant, Mr. O’Neil, purchased an insurance contract for his soybeans with a guaranteed production of 16,132.48 bushels.
17,457.42 bushels of soybeans were delivered to and accepted by Glencoe Grain & Seed Co. (Glencoe) as Grade No. 2 as evidenced by the ticket inquiry information issued by Glencoe (found on page 7 of the pre-filed document brief provided by AgriCorp).
There was a minor dispute about the amount credited by Glencoe to the appellant’s account. Mr. Wechselmann claimed the credit was in the amount of $10.00 per bushel. Whereas Mr. Murphy limited his client’s agreement to approximately $170,000 in the way of credit in order to take into account miscellaneous charges such as board and processing fees. This difference was not material to the issue to be determined on the preliminary motion.
On the basis of these agreed facts, the Board heard the following submissions of counsel.
Mr. Wechselmann argued that the Board has no jurisdiction and requested that the appeal be dismissed. His submission was founded on Section 2 of Regulation 140/96 made under the Crop Insurance Act which is as follows:
“2. The Board has exclusive jurisdiction to hear and determine all disputes between the Commission and an insured person arising out of the adjustment of a loss under a contract of insurance.”
His submission was that there was no loss under the contract of insurance; and, if there was no loss, then there is nothing to adjust under the contract of insurance and therefore the Board has no jurisdiction to deal with disputes arising out of the adjustment of a loss.
The issue is whether or not there has been a loss. Normally, disputes that come before the Board involve disputes arising out of the adjustment of a claim, sometimes including whether there has been a loss and if so the extent of the loss. In this case, the submission is that on the agreed facts, there simply is no loss under the insurance contract.
Mr. Wechselmann says that, as the Crop Insurance Act does not define the word “loss” nor does it speak as to what “loss” means, its meaning must be taken to be its normal and ordinary meaning.
Mr. Wechselmann attempted to make this point and to assist the Board by referring to General Regulation 256 - Crop Insurance Plan - General, Form 1, which sets out the contract of insurance, specifically as follows:
“WHEREAS the insured person has applied for a contract of insurance under the Crop Insurance Act (Ontario) and the regulations and has paid a deposit premium in respect thereof;
NOW THEREFORE, subject to,
(a) the Crop Insurance Act (Ontario);
(b) the regulations made thereunder; and
(c) the endorsement respecting an insured crop,
where in a crop year the insured person suffers a loss in the production of an insured crop from one or more of the perils designated in the plan for such crop the Commission, subject to the terms and conditions hereinafter set forth, agrees to indemnify the insured person in respect of such loss.”
Again Mr. Wechselmann says that the meaning of the word “loss” is not defined.
Mr. Wechselmann also referred to Regulation 232, Crop Insurance Plan for Oil Seed, specifically, Form 1 which reads as follows:
“Harvesting of Planted Acreage:
(2) Where the harvesting of any planted acreage is not completed and the failure to harvest was not caused by an insured peril, the contract of insurance ceases to apply to the unharvested acreage and no indemnity is payable therefor.
Evaluation of Loss
(1) For the purposes of determining the loss in production of soybeans in a crop year and the indemnity payable, the actual production of all harvested acreage of common soybeans and Natto-type soybeans shall be combined.”
Mr. Wechselmann submitted that, on the basis of the agreed facts, Mr. O’Neil did harvest his crop, and that he harvested more than his guaranteed production under the contract of insurance. Mr. Wechselmann referred to the Glencoe Grain & Seed Co. Ticket Inquiry which confirms that Glencoe received 17,457.52 bushels of soybeans from Mr. O’Neil. Mr. Wechselmann argued that, when taken with the agreed fact that Mr. O’Neil purchased crop insurance for his soybeans with a guaranteed production of 16,132.48 bushels and that Glencoe had credited his account with some $170,000.00 (17,457.52 bushels @ $10/bushel) for Grade No. 2 soybeans (which is top price in Ontario), there was no loss under the insurance contract.
The contract was for a harvest of 16,132.48 bushels and 17,457.51 bushels were harvested and accepted by Glencoe, hence no “loss” for the purposes of the insurance and thus the Board has no jurisdiction to hear this matter.
Mr. Frank Murphy, counsel to Mr. O’Neil, spoke on his behalf. He said that his client’s position was and the evidence would be that he delivered to the elevator 4,134.81 bushels of high quality beans and he had a guaranteed production of 16,132.48 bushels. Mr. Murphy says the evidence would be that the balance of the 13,322.71 bushels harvested had a high moisture content, some as high as 38%. His submission was that the evidence would reveal that Mr. O’Neil did not deliver to Glencoe 17,457.52 bushels of Grade No. 2 product. While Mr. Murphy agreed for the purposes of the preliminary motion that Mr. O’Neil’s account with Glencoe was credited with payment for Grade No. 2 product, he told the Board that he would adduce evidence that Mr. O’Neil may well be charged back for some of the costs incurred by Glencoe when they accepted his beans. He said that the evidence he wanted to place before the Board would be to the effect that in October of 1996, Mr. O’Neil only harvested 4,134.81 bushels as the balance of the crop had too high a moisture content.
Mr. Murphy told the Board that the evidence would show that, in December, AgriCorp ordered Mr. O’Neil to harvest his soybeans even though they had a high moisture content.
Mr. Murphy accepted that his client harvested and delivered to Glencoe 17,457.52 bushels of soybeans and that Glencoe accepted those soybeans and paid $10/bushel, for Grade No. 2 beans, and had some $170,000.00 credited to Mr. O’Neil’s account. However, he advised the Board that, in the circumstances of the continuing business relationship between his client and Glencoe, the evidence would be that very likely the transaction between Glencoe and Mr. O’Neil was not absolutely completed.
The Findings
The Board heard no evidence with the result that the Board’s decision with respect to Mr. Wechselmann’s preliminary motion is based on the facts acknowledged and agreed upon by counsel. Those facts are set out at the beginning of this decision but, for ease of reference, are repeated here as follows:
The appellant Mr. O’Neil purchased an insurance contract for his soybeans with a guaranteed production of 16,132.48 bushels.
17,457.42 bushels of soybeans were delivered to and accepted by Glencoe Grain & Seed Co. (Glencoe) as Grade No. 2 as evidenced by the ticket inquiry information issued by Glencoe (found on page 7 of the pre-filed document brief provided by AgriCorp).
There was a minor dispute about the amount credited by Glencoe to the appellant’s account. Mr. Wechselmann claimed the credit was in the amount of $10.00 per bushel whereas Mr. Murphy limited his client’s agreement to approximately $170,000 in the way of credit in order to take into account miscellaneous charges such as board and processing fees and so forth. This difference was not material to the issue to be determined on the preliminary motion.
On these facts, Mr. O’Neil was given credit for more soybeans than were covered by his contract for insurance with the result that there was no loss for the purposes of the contract of insurance. In reaching their decision, the Board relied heavily on the ticket inquiry information issued by Glencoe which indicates that 17,457.52 bushels of Grade No. 2 beans were delivered and accepted by them.
The evidence which Mr. Murphy said he would lead dealt with the possibility of disputes between Glencoe and Mr. O’Neil in their continuing business relationships. In the Board’s view, these are issues between Glencoe and Mr. O’Neil which cannot be retroactively visited upon AgriCorp. Glencoe issued its ticket information without any qualification and provided the credit to Mr. O’Neil’s account. AgriCorp, and perhaps others, relied on that information and, in the Board’s view, they are entitled to rely on it. If there was the potential for some dispute, it should have been made clear when the soybeans were received and when the credit was given. On the agreed statement of fact, there was no such indication or qualification at that time. In the Board’s view, AgriCorp is entitled to determine its position under its insurance contract on the basis of the soybeans that were delivered to and received by Glencoe and the credit that was given by Glencoe to Mr. O’Neil for those soybeans. On that basis, there was no insured loss under Mr. O’Neil’s insurance contract with the result that any other decisions in this matter are beyond this Board’s jurisdiction.
Decision of the Board
After careful consideration of the submissions made, the Board determined that, on the basis of agreed facts, Mr. O’Neil has no insured loss. On that basis, the Board has no jurisdiction under Section 2 of Regulation 140/96 made under the Crop Insurance Act. As a result the appeal is dismissed.
DATED at LONDON, Ontario this 11th day of September, 1997.