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:
Meehan v Director of Regulatory Compliance, Dairy Farmers of Ontario
Meehan v Director of Regulatory Compliance, DFO 1998 ONAFRAAT 42
STATUTE:
Ministry of Agriculture, Food and Rural Affairs Act
HEARING:
October 1, 1998
DATE OF DECISION:
October 6, 1998
1998-42
NEUTRAL CITATION:
1998 ONAFRAAT 42
Meehan v Director of Regulatory Compliance, Dairy Farmers of Ontario
IN THE MATTER OF THE MILK ACT AND SECTION 16 OF THE MINISTRY OF AGRICULTURE AND FOOD ACT.
AND IN THE MATTER OF:
An Appeal to the Farm Products Appeal Tribunal by Michael & Anne Meehan, Big Creek Dairy Farm, from decisions of the Director of Regulatory Compliance, Dairy Farmers of Ontario, dated June 22, 1998 and July 24, 1998, not to cancel the February, March and April, 1998 freezing point test results and resulting penalties.
Before:.
Denis O’Connor, Vice-Chair; Gertrude Levac, Member; Ron MacDonell, Member; Mary MacDonald, Observer Member.
Appearances:
Don Good, counsel to the appellants, Michael and Anne Meehan.
Anne Meehan, appellant.
Peter Gould, Director, Regulatory Compliance of the Dairy Farmers of Ontario.
DECISION OF THE TRIBUNAL
This appeal was heard in Belleville, Ontario on Thursday, October 1, 1998. Donald R. Good, Barrister & Solicitor, on behalf of his clients Michael and Anne Meehan, Big Creek Dairy Farm, filed an appeal with the Farm Products Appeal Tribunal (the Tribunal) from the decisions of the Director of Regulatory Compliance, Dairy Farmers of Ontario (DFO), dated June 22, 1998 and July 24, 1998, not to cancel the February, March and April, 1998 freezing point test results on samples of milk taken from Big Creek Dairy Farm.
Pertinent sections of Regulation 761 under the Milk Act are as follows:
Section 52
(1) The milk of every producer,
(b) may be tested for added or excess water at any time by a freezing point test,
at a laboratory approved by the Director.
(5) A freezing point test reading of -0.534° Horvet or higher shall be deemed to indicate added or excess water.
Section 53(1)
Where a producer is aggrieved by the result of any test made under section 52, 54 or 57 or by the finding of a field person under subsection 55(5), the producer may so notify the Director and the Director shall, without a hearing, consider the matter and decide whether the result or finding should be confirmed, varied or rescinded.
Section 53(2)
The Director shall notify the producer and the milk marketing board in writing of his or her decision.
Section 55(4)
Where the milk of a producer is tested under section 52 and found to contain added or excess water, the producer is, in respect of the milk marketed in the same month as the milk that was tested, liable to a penalty of,
(a) $2 per hectolitre in the case of a first penalty;
(b) $4 per hectolitre in the case of a second penalty;
(c) $6 per hectolitre in the case of a third penalty; and
(d) $8 per hectolitre in the case of a fourth or subsequent penalty;
incurred within any twelve-month period.
Section 54(9)
Where a producer incurs four penalties under subsection (4) within any twelve-month period,
(a) the Director shall so notify the milk marketing board and the producer in writing; and
(b) the milk of the producer shall not be marketed until the producer satisfies the Director that no milk that contains added or excess water will be sold or offered for sale.
The Background
The Bulk Tank Milk Grader takes a sample from each tank of milk before it is picked up. This sample is stored in a sample case by the Grader and transported to a depot. It is picked up from the depot and transported to the University of Guelph Laboratory (the Laboratory) where it is subjected to various tests one of which is for the freezing point of the milk.
Milk freezes at -0.540o H so the closer the test gets to -0.540o H the more normal the milk is. If the sample freezes at temperatures warmer than -0.540o H, it indicates more water than normal is in the milk. A warmer than normal freezing point is an indication of a problem on the farm, either from added water or water in excess of the average milk composition. Several possible sources of excess water have been identified in the past, some of which are:
Improperly sloped pipelines which allow for residual water in the pipe.
Flushing milk through the pipeline with water when the milk pipe is still connected to the bulk tank.
Bypassing safety switches.
Freezing in the bulk tank. If freezing occurs in the tank and subsequently thaws into the milk the freezing point can be affected.
Improper sanitizing procedures. If the pipeline is sanitized before milking and not enough time is provided for all of the water to drain before milking starts, freezing point of the milk may be affected.
In rare cases, the feed can cause difficulties.
In March of 1996, the Laboratory changed the equipment used to test milk for composition. Prior to that time all samples were heated in a water bath. These samples could not be tested for freezing point because there was a possibility the sample had some water added during the heating process. Separate samples were tested for freezing point than those tested for composition. New equipment (a Foss 4000) that does not use water to heat the sample was obtained by the Laboratory. Using this equipment, estimated freezing points are calculated from the composition measurements made on the milk sample. This allows technicians to screen milk samples for possible contravention of the freezing point regulation. Screened samples are then tested on the official Cryoscope testing machine. The screening done with the Foss 4000 has allowed the technicians to concentrate on the suspect samples and increase the frequency of the test for freezing point. Freezing point testing on the Cryoscope is labour intensive and therefore was not done as frequently in the past as it currently is being done. In fact, milk samples are now screen tested for freezing point four times a month.
The number of freezing point penalties has increased significantly since the change in procedures. The penalty test results are:
1993 96 penalties assessed.
1994 180 penalties.
1995 89 penalties.
1996 318 penalties, of which 176 occurred after October 1.
1997 415 penalties.
Big Creek Dairy Farm is located near Carp, Ontario. The farm produces and markets milk without quota. There are four freezing point test violations of milk samples taken from Big Creek Dairy Farm between November 1997 and April 10, 1998. The results are as follows:
Date
Freezing Point o H
Penalty Assessed
November 11, 1997
-0.518
$110.00
February 17, 1998
-0.516
$117.40
March 1, 1998
-0.522
$210.90
April 10, 1998
-0.523
$126.90
From May through September 1998, milk pick up volumes at the farm range between just under 600 litres per pick up to just over 800 litres per pick up. From November 1997 through April 1998, milk pick up volumes ranged from just under 200 litres per pick up to just over 300 litres per pick up.
The Issue
The issue before the Tribunal is:
Should the freezing point test results on samples of milk taken from Big Creek Dairy Farm in February, March and April 1998, and the consequential penalties, be allowed to stand?
The Evidence and the Findings
In his opening comments Mr. Good, Counsel to Big Creek Dairy Farm, said the appellants were asking the Tribunal, on humanitarian grounds, to exercise its discretion to grant relief to the appellant from the penalties and test results. He said that the evidence would show that the difficulties that caused the three penalties were directly related to ice storm damage that occurred in the catastrophic storm in the geographic area of the farm in January 1998. He emphasised that the appellant is not disputing the test procedures or test results.
Anne Meehan spoke to the Tribunal on behalf of Big Creek Dairy Farm. She said that she and her husband Michael operate Big Creek Dairy Farm. The farm is in Ottawa-Carleton and consists of 150 acres that they own and another 150 acres that are leased. They have a dairy operation and a shorthorn beef herd on the farm. Each herd consists of about 60 head of cattle. She said she has been farming for the last four years but her husband has been on a farm all his life. They currently operate the dairy without quota and as soon as their financial resources permit they will be purchasing quota for the dairy operation.
Mrs. Meehan told the Tribunal that in February 1997 her husband turned the bulk tank cooler on before there was milk in the tank and that resulted in a freezing point violation. They are not disputing this and accept that the cause was human error.
She said that when the second penalty occurred in November 1997 she and Michael were showing animals at the Royal Winter Fair. The hired hand turned on the cooler prior to beginning milking. This was the cause of the second penalty and they are not disputing this test result.
Mrs. Meehan told the Tribunal that they grow grain to feed the cows. In 1997, when the grain was ready to harvest they could not hire a custom operator to combine it and they lost the entire crop. As a result, they did not have grain in the ration fed to the milk cows from the fall of 1997 onward. During this time, they fed hay, corn silage, minerals and vitamins to the milking cows. The corn silage is stored in two silos on the farm, one has recently been relined and preserves the feed better than the other. They fed from the older silo first as the corn will freeze in it and cannot be fed if it is not used first. When the ice storm occurred, they had to switch to the newer silo.
She said their farm was affected by the January 1998 ice storm and lost its electrical power. They did not have a generator and they do not know how to milk the cows by hand. The cows were not milked for five milkings and eight lactating cows perished. When they did get a tractor driven generator for the barn, they were not familiar with the operation of portable generators and the generator caused havoc with all of the motors in the barn as well as causing damage to the tractor engine. As a result, the compressor in the bulk tank had to be repaired. When the refrigeration repairman was at the farm he told them they should have 100 litres of milk in the bulk tank before turning it on so it could work properly. When they received their first payment for ice storm disaster assistance they immediately bought additional cows from Carson’s Sales Arena in Listowel. She said when these cows were put on the milk line and things returned to normal their production picked up and their milk test results have been fine ever since.
Mrs. Meehan told the Tribunal that the April freezing point test put them into a situation where the milk pick-up was shut-off. Their pick up ceased on April 15 and was restored on May 1 after they had gone through the remedial process required by the DFO. They were required to have their equipment checked by their service provider, a nutritionist had to come to the farm, they had to meet Grade A premises standards and have a normal freezing point test result before the regular milk pick-up was restored.
Mrs. Meehan said they have to refinance the farm and purchase quota in order to carry on. They are having difficulty finding a lender since they are facing shut-off from milk pick up if any further mistake that affects the milk freezing point is made on the farm. She said without the income from the milk, the farm would not be viable.
In response to questions from the panel, Mrs. Meehan said that the increase in milk volume shipments in January, after the ice storm and the death of eight of the milk cows, was the result of feeding the twelve remaining cows from the second silo. She said at the present time they are milking around 20 cows and their shipments are between 600 and 800 litres, averaging about 700 litres per pick up.
Mr. Gould, Director of Regulatory Compliance for the DFO, told the Tribunal that the ice storm presented unusual circumstances to the farmers affected. The DFO decided not to use any test results in the affected area for official purposes except inhibitor test results. Consequently, there were no freezing point tests done in January 1998 on milk from the appellant’s farm.
He noted that the volume shipped from Big Creek Dairy Farm when milk pick-up resumed after the ice storm was equal to or greater than the shipments during the months prior to the storm. He said it was difficult to conclude that the storm had an adverse impact on the volume of milk shipped from this producer. He also noted that the majority of the freezing point test results were in the warning or penalty range until the shut-off occurred. Freezing point test results after milk pick-up resumed in May are in the normal range.
Mr. Gould pointed out that the equipment dealer had inspected the farm and concluded that the problem was not with the equipment but that the volume of milk was too low. He said that once the nutritionist had visited the farm and the cows had been provided a balanced ration, the milk production increased and the problems with freezing point test results appeared to be corrected. He said that there have been two instances of screening test results that are close to the penalty level so the farm operators have to remain vigilant to avoid penalties in the future.
Mr. Gould said that after meeting the requirements to be reinstated to the market, the Meehan’s followed the suggestions for managing their herd with resulting increases in production and milk quality. The DFO requirements for reinstatement to the market are normal practice on most dairy farms. Because of this he concluded that the problem on the farm related to management rather than to the ice storm. Mr. Gould said that he was not sure he had the authority to disregard a test result unless there is evidence of a problem in the sampling, sample handling or testing procedures. Since the appellants were not contesting the test results or testing procedures, he confirmed the test results and applied the penalties stipulated in the regulations. In response to questions from Mr. Good, Mr. Gould confirmed that there were other producers in the area affected by the ice storm whose milk sample had not passed the freezing point test in February 1998 and afterward and these producers were assessed the appropriate penalties.
Mr. Gould told the Tribunal that the goal of the Director, Regulatory Compliance for DFO, is to have fieldpersons visit farms when the producer is in the warning range and avoid penalties if possible. The goal is to have high quality milk offered for sale consistently from all producer premises. He said they have established priorities for the present time. An inhibitor violation is top priority, a shut-off is second priority, third priority are producers one penalty level before shut-off. The last priority is the producer who has a penalty level test result other than inhibitors. He said the level of service varies by area and some areas are already at the level where they have cleared up previous problems and can visit farms as soon as any test result shows a penalty level and other areas are working to this goal.
In his summation, Mr. Good argued that the Tribunal should take a liberal interpretation of the Milk Act when arriving at its decision. He said that the purpose of the Act was to increase milk production in Ontario and that purpose would be fulfilled by granting the appeal and allowing the Meehan family to obtain the finances needed to continue their dairy farm. He said that they were not disputing the test results but asking for consideration on humanitarian grounds because of the impact of the January ice storm on this producer.
In his summation, Mr. Gould said that there was no dispute of the test results and when the Meehan family changed the feed ration and began operating the equipment properly, the problem of freezing point test results was solved. He said that he could see no relationship between the ice storm and the freezing point violations. There was however, in his opinion, a relationship between farm management and the freezing point violations. Therefore, he saw no reason to provide relief from the test results and the subsequent penalties assessed.
The Tribunal examined the evidence. The Tribunal understands that the Meehan family wants to stay in the milk production business. The Tribunal recognizes that they have made drastic changes on the farm in order to produce milk of consistently high quality to offer to the marketplace. In the opinion of the Tribunal, the Meehan’s have made corrections as far as nutrition and herd improvement are concerned. The Tribunal encourages them to remain vigilant in all management aspects of their dairy operation.
The Tribunal is also encouraged by the statements of the DFO that the goal is to visit a farm as soon as the test results indicate a quality problem or penalty possibility. In the opinion of the Tribunal, this action might help to avoid a future situation similar to what the Meehan family has experienced.
The Tribunal accepts the position of the DFO that the change in nutrition and equipment management appear to have corrected the problem. The Tribunal notes that this action was not taken until after the freezing point violations in February, March and April, and then only after this producer was shut-off from the market. The Tribunal finds no cause-effect link between the January 1998 ice storm and the freezing point violations. The Tribunal believes it was changes in on-farm management that solved the problem.
The Tribunal heard argument from Mr. Good on the authority of the Director and the Tribunal to apply discretion in varying or rescinding of penalties resulting from test violations. An opinion from counsel to the Tribunal was received and comments on this opinion were made by Mr. Good and Mr. Gould. The Tribunal is of the opinion that the circumstances surrounding this case do not warrant ordering the DFO to alter its decisions made June 22 and July 24, 1998.
Decision and Reasons
After careful consideration of the evidence presented and the submissions made, the Tribunal decided to deny the appeal for the following reason:
In the opinion of the Tribunal, the management of the farm was less than desirable even before the ice storm and, while the ice storm provided additional stress on the situation, it was not until after the milk pick-up was shut-off that corrective action was taken on the farm.
DATED AT Guelph, Ontario THIS 6th day of October, 1998.