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:

Pillon et al. v Agricorp

Pillon et al. v Agricorp 2001 ONAFRAAT 10

STATUTE:

Crop Insurance Act

HEARING:

January 17, 2001

DATE OF DECISION:

February 20, 2001

2001-10

NEUTRAL CITATION:

2001 ONAFRAAT 10

Pillon et al. 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 Maurice Pillon, Rochester Township, Ontario, from the decision of AGRICORP to deny him a claim concerning his 1999 soybean crop under Regulation 380/97 and the Crop Insurance Plan For Soybeans.

Before: Jim Rickard, Chair; John Taylor, Vice Chair; Armand Bechard, Member; Jim Gibb, Member

Appearances:

Maurice Pillon, appellant

Paul Enns, counsel to the appellant

Harry Fraser, for the respondent

Rosaire St. Pierre, for the respondent

Jim Zavitz, Quality Assurance Manager, AGRICORP

DECISION OF THE BOARD

This appeal was heard in Leamington, Ontario on Wednesday, January 17, 2001.

Mr. Pillon appealed to the Agriculture, Food and Rural Affairs Appeal Tribunal a decision of AGRICORP concerning the adjustment of loss under Ontario Regulation 380/97 and the Crop Insurance Plan for Soybeans for his 1999 crop year.

The Background

In proposing and administering the Soybean Plan, AGRICORP derives its authority from Section 5 of the Crop Insurance Act (Ontario), 1996 and Regulation 380/97, Crop Insurance Act (Ontario) 1996 and the 1999 Crop Plans.

The Crop Insurance Act (Ontario), 1996, specifically, sections 5(1), (2), (4),(10) state:

5. (1) AGRICORP shall fix the terms of contracts of insurance, or proposed contracts of

insurance, subject to section 4 and the regulations made under section 12.

(2) AGRICORP has all the powers necessary to perform its duties including the power to,

(a) determine the qualifications and requirements for a person to enter into a contract of insurance:

(b) enter into contracts of insurance:

(c) fix terms of contracts of insurance relating to replanting benefits and unplanted acreage benefits;

(d) fix premium rates payable by insured persons;

(e) fix the duration of contracts of insurance;

(f) specify the circumstances in which an insured person may terminate a contract of insurance and the methods that the person may use to terminate the contract;

(g) specify penalties imposed on an insured person who breaches the terms of a contract of insurance;

(h) reinsure with any other insurer the risk or any portion of the risk under its contracts of insurance; and

(i) terminate a contract of insurance on the terms that it considers appropriate.

(4)AGRICORP shall not enter into a contract of insurance with a person to insure an

agricultural crop or a type of perennial plant if,

(a) the contract insures less than the entire crop or all the plants of the type of perennial plant, as the case may be, in respect of which the person could enter into a contract of insurance under this Act; or

(b) a contract of insurance is already in effect to insure the crop or the type of perennial plant, as the case may be, in which the person has an interest.

10. (1) If AGRICORP and a person disagree on a matter described in subsection (2) or if AGRICORP and an insured person fail to resolve a dispute arising out of the adjustment of a claim under a contract of insurance, either may appeal the matter in dispute to the appeal board for the purpose of this section.

(2) Subsection (1) applies to a question whether a person qualifies for a contract of insurance except if the disagreement relates to the time during which a person may apply for a contract of insurance or file a final acreage report or its equivalent.

Ontario Regulation 380/97, sections 3 and 10 state:

3.(1) A contract of insurance consists of,

(a) the application;

(b) the renewal notice and change notice, if any;

(c) the final acreage report or its equivalent;

(d) the terms fixed by AGRICORP under section 5 of the Act; and

(e) this Regulation.

14. No term of a contract of insurance shall be deemed to be waived or altered by AGRICORP unless the waiver or alteration is given in writing.

The role of the Tribunal is set out in Ontario Regulation 140/96. Specifically, clauses 2 and 3 of the regulations state:

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.

3(1)If the Commission and an insured person have failed to resolve any dispute arising out of the adjustment of a loss under a contract of insurance and have complied with all requirements respecting the filing of proof of loss forms, either party may appeal the matter in dispute to the Board.

(2)To appeal the matter in dispute, the appellant shall file a notice of appeal with the Board and send a copy of the notice to the other party within one year of filing the proof of loss form.

(3)Where a party has appealed in accordance with subsection (2), the Board shall fix a day, a time and a place for considering the matter in dispute and hearing the parties, and shall notify the parties accordingly.

(4)On the day, and at the time and place so fixed, the Board shall hear the evidence of the parties respect the matter in dispute, and shall make a decision on the matter.

In 1999 Mr. Maurice Pillon insured 75 acres of soybeans with AGRICORP. He purchased an 80% coverage option which gave him a guaranteed yield of 15.74 bu/acre. The yield in 1999 from the Pillon farm was 7.59 bu/acre. Mr. Pillon submitted a claim to AGRICORP on the grounds that the low yield was the result of drought, an insured peril.

AGRICORP denied the Pillon claim on the grounds that the yield reduction was due to an uninsured peril (weeds). It noted that the yields from this farm were not consistent with the soybean yields of other farms in the area and noted that good farm practices for responding to weeds were not followed.

The Issue

The issue before the Tribunal is, did AGRICORP fairly adjust the 1999 claim for loss of soybeans on the Pillon farm?

The Findings

Appellant’s Evidence

Mr. Maurice Pillon testified that he had farmed all his life and that he currently farms in Rochester Township under the business name Peldale Farms. He said he had a 40-cow cow/calf operation and he grew soybeans on the balance of his land. Mr. Pillon explained that he cropped using the no till method, with the exception that he worked manure into the soil immediately after spreading.

With regard to his 1999 soybean crop, Mr. Pillon told the Tribunal:

1. He applied Round-Up to his fields at the rate of 1.5 litres/acre prior to planting. He used Round-Up he had leftover from the year before, as well as some that his son had purchased for him. He said he achieved a good burn down of weeds from the herbicide.

2. He had his crop custom planted as his grain drill was in poor condition. The crop was planted the 28^th and 29^th of June.

3. The condition of the field was dry at the time of planting and the crop was slow to germinate. However, by the end of July the crop was doing fairly well.

4. In August, he observed grass in the soybean field and he applied additional Round-Up with a wicker. This controlled the tall weeds (grasses and ragweed) but not the small ones. He said that overall there was not a bad weed problem in the field.

5. At harvest the soybeans were short and not well podded.

6. He observed that 1999 was a dry year.

7. The crop was harvested in October 1999.

Mr. Enns submitted into evidence a photograph of the back 50 acres of soybeans which was taken on September 23, 1999. Mr. Pillon explained that the photo showed the last field that was harvested. He pointed out that there was a creek bank in that field that he can never keep clean of weeds (wild lettuce, ragweed). He estimated that approximately 50 bushels of soybeans from that area of the field sat on the top of his storage bin, as the creek bank was harvested last.

Mr. Pillon stated that he realized the crop was not performing well in August and that he notified Mr. St. Pierre of the problem at the Harrow Fair on September 8^th or 9^th. On Mr. St. Pierre’s advice he made a report to AGRICORP on the following Monday by telephone and received a confirmation number. He said that he later harvested the soybeans in the fall as usual. Mr. Pillon testified that no representative from AGRICORP inspected the field before he harvested it. He explained that he called AGRICORP again in November to inquire as to when a representative was coming, but that no one arrived to measure his storage bin until January 2000. He said that there was no sample collected at that time.

Mr. Pillon said that after the first inspection, Mr. St. Pierre visited the farm and inspected the beans before they were marketed. He said that Mr. St. Pierre looked in the bin but did not take a sample. Mr. Pillon indicated that he did not know how Mr. St. Pierre could estimate there were 25% weed seeds in the crop, as the high weed seed portion was just a small spot at the top of the bin. He pointed out that there was only 8% dockage in the soybeans he shipped to Archers Daniel Midland (ADM) from the 1999 crop. Mr. Pillon also disagreed with a statement in Mr. St. Pierre’s report that indicated he had applied Round-Up at the wrong rate and he noted that, contrary to Mr. St. Pierre’s report, he had not worked off the farm since 1995.

In response to questions from Mr. Fraser, Mr. Pillon stated that:

1. He applied Round-Up in early-mid June 1999, approximately 15 days before the crop was planted.

2. He was not aware of a maximum recommended time between spraying and planting. He had approximately 20-30 litres of Round-Up leftover from 1998, his son purchased approximately 40-60 litres for him in the spring and another 20 litres for wicking in the summer.

3. His leftover pesticide was stored in an unhooked freezer in his workshop at 55 º F.

4. No other herbicides were used between burn-off and wicking.

5. He was aware that 1999 was a dry year but he was not aware that, with no till cropping systems, in dry years OMAFRA recommended that post emergence foliar chemicals were more effective than wicking.

6. He understood that when beans were in bloom he could not spray them.

7. The predominant weed in the crop was ragweed.

8. He always applied Round-Up at 1.5 litre/acre for burn down.

9. 1999 was the first time he planted Round-Up Ready (RR) soybeans.

10. He thought that the wicker application would control the weeds in the crop.

11. He applied both applications of pesticide himself.

12. He did not have a pesticide safety certificate.

13. He agreed that the presence of weeds would put pressure on the crop but noted that the soybeans had some height to them.

14. He agreed that ideally it would be better to control weeds from early on in the season and noted that was why he used the wicker.

15. He agreed his crop insurance claim rate of 27.5% claim rate was higher than the provincial average of 6%.

16. He agreed that continuous planting of soybeans could affect his yields.

In response to specific questions regarding his production history, Mr. Pillon indicated that:

1. In 1999 he had to tear up about half of 12 acres of new crop and that explained the difference in acreage between 1999 and other years.

2. He agreed that 1991 was a drought year said he thought differences in soil conditions in 1999 vs. 1991 could explain the higher yield he achieved in 1991.

3. He agreed that there were no other farms in his township with a yield in the same range as his (5-10 acres/bu), according to an AGRICORP yield map. But, he questioned the accuracy of the map as he noted that the farm to the north of his was in hay, not soybeans.

4. He kept 150 bushels of soybeans for seed in 1999 and these soybeans were in the bin when the bin was measured.

5. He suggested that his neighbors to the North may have achieved yields closer to their average yields due to crop rotation.

6. He always fertilizes with manure.

7. He did not know that the soybean industry agreement allowed 1% dockage without penalty.

8. He did not pre-clean his soybeans before shipping them to the elevator.

9. He did not ship soybeans under any name except Peldale Farms. Peldale Farms was a partnership at one time but he was now the sole owner. He had not notified AGRICORP that he shipped under the farm name.

Mr. Pillon acknowledged that there were two versions of the ADM weigh slip, one signed by him and one unsigned. He stated that he signed the form at the elevator on the yellow slip.

Mr. Pillon said he could not account for a 112 bushel difference between soybeans measured in the bin (569 bu, later adjusted to 609 bu) and the volume sold to ADM and retained for seed (480 bu total) but he theorized that the AGRICORP fieldman measured the bin incorrectly.

In response to questions from the Tribunal, Mr. Pillon explained:

1. He knew he kept 150 bu of soybeans for seed as that was the amount that filled his gravity box and he had 146 bu of these soybeans cleaned through a portable screener with an attached weigh scale.

2. He could not plant before late June as he had to wait for a custom operator.

3. His entire acreage in 1999 was planted on soybean stubble.

4. There was an abundance of weeds prior to burn down but the Round-Up was effective.

5. He sprayed before planting as he had quack grass he wanted to control. He had used Pursuit and Basagran in the past, but he felt they should not be used with RR soybeans.

6. He did not know the heat unit on his soybeans. He purchased the RR seed from a farm that grows RR varieties.

7. He was forced to grow soybeans each year as the returns from wheat were too low and he could not afford to grow corn. He did put 12 acres in corn in 2000. He used land at another location for hay.

8. Manure was applied in the fall. In addition to his own cattle manure he accepted liquid manure from a slaughterhouse. The slaughterhouse waste had been tested and approved.

9. The weedy ditch bank in his field was approximately 50 feet wide and yielded approximately 50 bu of soybeans.

10. He believed that his soybeans contained approximately 8% weed seed.

11. The 8% “other deductions on the ADM weigh slip could have referred to dirt, weed seed, or stems in the shipment.

12. No representative of AGRICORP inspected the crop in the field.

13. He chose to use a wicker rather than broadcast spray Round-Up as he understood that he could not spray any soybeans, even RR soybeans, when they were in bloom.

14. He agreed that he could be applying too much nitrogen, given his continuous soybean production system.

AGRICORP Evidence:

Mr. Harry Fraser, AGRICORP stated that he intended to prove: the appellant did not use good management practices; that he had a substantially low yield that was inconsistent with other farms in the area; that his spray program was a rescue process, not a recommended practice; and that there was an inconsistency between the yield delivered and the yield measured.

Mr. Fraser suggested that the relevant sections of the insurance contract were:

1. Part I, Section K (1) (e) “If an Applicant, or an Insured, in any way: willfully makes a false statement in respect of a claim under the Contract, the Contract is void to all crops …”

2. Part I, Section K (3) “Where, in the discretion of AGRICORP, the Insured is engaged in farming practices, farm management procedures or operations, or improper conduct or improper conduct or procedure which directly or indirectly contributed to a loss for which the Insured is claiming an indemnity, or where the loss in respect of which the Insured claims has been caused by the conduct of any person or persons other than an Insured, AGRICORP may: a. deny liability under the Contract; b. reduce the amount of the indemnity by the amount AGRICORP determines was caused by the conduct of such person or persons, or by such farming practices, management procedures or operations, or other improper conduct or improper procedure.”

3. Part I, Crop Conditions (6) “Where there is insurance against loss due to a reduction in the quality of an insured crop and if the insured crop is damaged in quality as a result of an insured peril, the adjusted yield used for the purpose of determining the amount payable under this Contract will be adjusted as determined by AGRICORP.”

4. Part I, Crop Conditions (9) “Where the loss or damage has been caused or contributed to by an insured peril and a failure to follow good farm management practices, the insurance provided by this Contract does not apply to that portion of any loss or damage caused or contributed to by a failure to follow good farm management practices.”

5. Part II, Section B Insured Perils “The insured perils that apply to the crops insured under this part are as set out below. … soybeans: drought, excessive moisture, excessive rainfall, flood, frost, hail, insect infestation and plant disease provided recommended control practices are followed, wildlife and wind”

Mr. Fraser called Mr. Rosaire St. Pierre as a witness. Mr. St. Pierre told the Tribunal he had been an adjuster for AGRICORP for 10 years and that he had farmed in the in Lakeshore area (Rochester and Maidstone) for 45 years.

Mr. St. Pierre testified that he advised Mr. Pillon to call AGRICORP’s Guelph office when they spoke at the Harrow fair in September 1999. He stated that this was a normal procedure and that a farmer receives a confirmation number when a claim is reported. He said he did not immediately receive notice from the Guelph office that the claim had been made. He explained that he was asked by his Regional Manager to investigate the yield claim in January 2000. Mr. St. Pierre explained that his normal practice in investigating a claim is to telephone the producer to make an appointment, together with the producer measure the grain bin or examine storage receipts to estimate yield, and then discuss the producer’s reason for the claim.

Mr. St. Pierre stated that when he visited the Pillon farm in January 2000, Mr. Pillon told him he had applied Round-Up at a rate of 0.5 litre/acre for the burn down. Mr. St. Pierre said that he asked Mr. Pillon at the time if he was sure that was the rate used and Mr. Pillon confirmed it. Mr. St. Pierre said he asked Mr. Pillon for receipts for the herbicide but Mr. Pillon did not make any available. He noted that Mr. Pillon did tell him that he used some Round-Up leftover from the year before and some that was purchased in 1999.

Mr. St. Pierre confirmed that he measured the storage bin on the Pillon farm and verified the measurements previously taken by Mr. Leo Gilbeault. Mr. St. Pierre could not explain the difference between the soybeans measured in the bin (569 bu, later adjusted to 609 bu) and those accounted for by the producer (480 bu). He also noted that he investigated claims in Tilbury North, Tilbury West and Rochester Township and that he saw no other soybean yields as low as Mr. Pillon’s yield in 1999.

In response to questions from Mr. Enns, Mr. St. Pierre explained:

1. Soybeans are measured in the bin by measuring the circumference of the bin, and estimating the height of the soybeans, and the height of the cone at the top of the bin.

2. After his discussion with Mr. Pillon at the Harrow fair, January 2000 was the next time he was aware of the Pillon claim.

3. AGRICORP adjusters sometimes inspected the crop in the field in the event of a claim and sometimes did not.

4. No sample was taken of the soybeans on the Pillon farm. It was his normal practice to examine a handful of soybeans. Mr. St. Pierre did not probe in the centre of the bin to get a sample.

5. Based on his examination of a handful of soybeans from the top of the bin, he estimated they contained 25% weed seed. Mr. St. Pierre recalled that Mr. Pillon mentioned there were a lot of weeds in his field when they met in January 2000. He said that Mr. Pillon appeared comfortable with the 25% weed seed estimate at the time.

6. As soon as Mr. Pillon told him the rate of application of Round-Up Mr. St. Pierre thought it was not enough and he discussed it with Mr. Pillon at the time.

7. The measurement of 569 bu made by Mr. Gilbeault was adjusted to 609 bu by staff at the Guelph office of AGRICORP as a mathematical error was discovered.

8. It was not unusual for a mathematical error to be caught in the Guelph office.

In response to questions from the Tribunal, Mr. St. Pierre said:

1. He could not recall if he was aware that Mr. Pillon’s loss could be significant when they spoke at the Harrow fair, but he did remember that Mr. Pillon told him the crop looked bad.

2. He did not recall if he adjusted other claims in the area that fall.

3. No test weight was taken of the soybeans. AGRICORP adjusters will do test weights for producers on request.

4. Mr. Pillon signed Mr. St. Pierre’s January 15, 2000 report at the time. The reference to 25% weed seed was on the report when Mr. Pillon signed it. Mr. St. Pierre could not say whether Mr. Pillon read the report before signing it or not.

5. He could not explain why there was only 8% dockage at the ADM elevator when his estimate was 25% weed seed in the crop.

Mr. Fraser explained that AGRICORP adjusters are directed not to investigate claims until notified by the Guelph office. He said that in this case, the claim was reported but that it was not properly recorded in Guelph. He acknowledged that there may have been a field inspection had the fieldstaff been notified of the claim earlier.

Mr. Jim Zavitz testified with regard to two Essex County soybean yield maps that AGRICORP submitted into evidence. He explained that the crop yields of AGRICORP customers are plotted on a geographical map, according to the location of their home farm. He said that all of a customer’s fields of soybeans would be plotted on the map at their home farm, even though there might not be soybeans planted on the home farm each year. He said there was no requirement for producers to record rainfall, except for producers insured under the forage plan.

Mr. Fraser pointed out to the Tribunal that there was some question as to what happened to 103 bushels of soybeans from the Pillon farm. He noted that the AGRICORP measurement, adjusted for mathematical error was 609 bu, and that Mr. Pillon could only account for 506 bu (356 bu sold to ADM and 150 bu retained for seed).

Mr. Fraser suggested that Mr. Pillon had provided false particulars of his claim as he reported to the adjuster that his application rate of Round-Up was 0.5 litre/acre and at the Hearing he claimed the rate he used was 1.5 litres/acre. Mr. Fraser said that AGRICORP believed that Mr. Pillon’s farm practices directly or indirectly contributed to the loss. He pointed out that Mr. Pillon had acknowledged that he planted his crop much later than others in the area, and that he had no crop rotation to promote good soil structure. He also observed that Mr. Pillon made inappropriate use of Round-Up, given that the variety he grew was Round-Up Ready.

Mr. Fraser also submitted that Mr. Pillon failed to take adequate care of his crop. He pointed out that Mr. Pillon could have scouted the field better, and could have made use of OMAFRA recommendations and sprayed his weeds at the proper time. Mr. Fraser reminded the Tribunal that weeds were not an insured peril and that AGRICORP is not required to pay claims where the loss of yield is preventable. He submitted that Mr. Pillon could have used a more effective weed control system and that the loss could have been avoided had Mr. Pillon followed good farm practices.

Mr. Fraser acknowledged that the loss of yield on the Pillon farm was likely due to a combination of weeds and drought. However, he noted that in a drought year that planting earlier would have been a preferable practice, that excess weeds would put an extra stress on the crop and that the lack of crop rotation would contribute to a loss of residual soil moisture. He said that AGRICORP had other clients in Essex County who were paid claims based on drought. He explained that Mr. Pillon’s claim was denied in its entirety because his crop was neglected.

Mr. Fraser pointed out that Mr. Pillon’s 1999 yield was only 39% of his average farm yield over the previous 10 years. He noted that other AGRICORP clients on the same road as Mr. Pillon achieved yield s that were 60%-100% of their ten-year averages. He stated that only Mr. Pillon and one other producer were in the 30%-40% of average yield range. Mr. Fraser agreed that all of the crop may not have been grown on fields on that road, but noted that there were very few producers in the Township with 1999 yields as low as Mr. Pillon, relative to their ten-year averages.

Mr. Fraser explained that AGRICORP did not usually refuse to grant insurance to producers but that they do underwrite some producers at lower yield guarantees. He said that AGRICORP did on occasion pay partial claims when they felt that a crop had been mismanaged and that their fieldstaff determined whether the damage was partially drought and partially poor management. He indicated that if Mr. Pillon’s yields had been comparable to other producers in the Township that they may have assumed drought was responsible, but that under the circumstances, AGRICORP attributed the poor yield to mismanagement.

Mr. Fraser acknowledged that wicking was an acceptable rescue process when weeds are a problem. However, he pointed out that it was not sensible to use wicking on RR soybeans and he stated that the crop would have already been very stressed before wicking would be effective.

Mr. Fraser explained that the amount of the claim that Mr. Pillon was requesting was $4833.71, based on the difference between his 1999 yield and 80% his ten-year average yield, multiplied by 75 acres.

Reply Evidence

Mr. Pillon told the Tribunal that he was fairly sure that he told Mr. St. Pierre that he applied Round-Up at a rate of 1.5 litres/acre, but that they were discussing other things at the time. He said he did not recall being asked to provide bills for Round-Up. He explained that he did not read Mr. St. Pierre’s report before signing it but that Mr. St. Pierre had read it aloud to him. He said that he was aware that the report indicated there were 25% weed seeds in his soybeans at the time he signed it. He said that he did not object at the time because Mr. St. Pierre was the adjuster. Mr. Pillon stated that he had not seen the Special Report prepared by Mr. St. Pierre after he left the farm.

Mr. Pillon explained that he knew how much herbicide he put on the field because his sprayer holds 350 Canadian gallons and he added one 10-litre jug and one 5-litre jug of Round-Up. This was spread over 18-20 acres if the weeds were bad. He said he used less herbicide on less weedy fields. He said that he adds oil to make the herbicide stick to the weeds. Mr. Pillon testified that he was satisfied that his weed control system worked well. He explained that he got a good burn down that controlled both crab grass and twitch grass. He said he used the same practice in 2000 but did not have to wick.

Summations:

Mr. Enns observed that there was a discrepancy with regard to the 1999 soybean yield on the Pillon farm. He acknowledged that his client did not keep perfect records but he submitted that the amount recorded on the ADM weigh slip and the 150 bu his client retained for seed should be the accepted yield. He stated that the AGRICORP yield estimate was based on an “eyeball” of the storage facilities and therefore could be expected to be slightly off.

With regard to whether or not the claim should be paid, Mr. Enns pointed out there was no disagreement that Mr. Pillon applied for insurance before the deadline date and that he paid his premium. He said his client used what he felt was an appropriate amount of herbicide and achieved what he felt was an adequate burn down. Mr. Enns submitted that the crop was planted late due to circumstances beyond Mr. Pillon’s control. He said the late planting could account for Mr. Pillon’s yield being off more than his neighbors’ yields.

Mr. Enns noted that the AGRICORP chart was not as scientific as it appears but that its value was in demonstrating that yields were in fact down in the region. He submitted that this was due to drought conditions. Mr. Enns pointed out that under drought conditions weed problems are exacerbated, as weeds are hardier than soybeans. Mr. Enns acknowledged that Mr. Pillon should consider crop rotation but he submitted that crop rotation is not mandatory and that his client’s financial situation determined that he plant soybeans. He submitted that the low yield in 1999 was caused by drought, not Mr. Pillon’s failure to rotate crops.

With regard to the AGRICORP report that Mr. Pillon signed, Mr. Enns stated that Mr. Pillon had known Mr. St. Pierre all his life, and that perhaps because of that he did not look as closely as he should have at what was in the report. Mr. Enns reminded the Tribunal that the initial claim was not immediately processed in AGRICORP”s Guelph office, and suggested the dispute may have been avoided if the field had been inspected. Mr. Enns suggested that Mr. Pillon’s claim was denied due to an estimate of 25% weed seed, based on an adjuster’s casual look at soybeans at the top of the bin. He said his client had explained why there was a higher ratio of weed seeds at the top of the bin and submitted that the 8% dockage calculated by ADM was more representative of the crop.

Mr. Enns submitted that Mr. Pillon’s soybean crop, like many in the neighborhood, did not perform well due to drought, that the weeds in the crop were a symptom of the drought and that Mr. Pillon attempted to rescue the crop by wicking the weeds, without success. He also pointed out that Mr. Pillon’s farm practices are already penalized through higher premiums.

Mr. Fraser told the Tribunal that AGRICORP had brought forth information that showed Mr. Pillon did not comply with his crop insurance policy. He said it remained AGRICORP’s contention that Mr. Pillon did not use the recommended rate of 1.5 litre/acre when he applied Round-Up prior to planting. He pointed out that Mr. Pillon had not provided receipts to show that he did use sufficient herbicide. He also noted that no foliar chemical was used when weeds became evident, only wicking. He said that given that RR soybeans were planted, Mr. Pillon could have sprayed with Round-Up post emergence, to control the weeds.

Mr. Fraser reminded the Tribunal that weeds are not an insured peril. He said that payment of this type of claim is unfair to other growers in the area who are better managers. Mr. Fraser noted that half the funds used to pay claims are generated through grower premiums.

Mr. Fraser pointed out that no other grower in the region had as low a percentage of his or her ten-year soybean yields in 1999 as Mr. Pillon did. He pointed out that with a yield of 7.6 bu/acre, it would have cost Mr. Pillon almost as much to harvest the crop as he received for the sale of the soybeans. Mr. Fraser said that AGRICORP was not conceding that Mr. Pillon’s estimate of the yield was correct. He said there was approximately 100-bu difference between the measured yield and the soybeans delivered to ADM or kept for seed. He suggested it was an odd coincidence for a soybean crop to yield exactly enough soybeans for one wagonload to the elevator and the amount needed for seed. Mr. Fraser said he was concerned that the crop was shipped under a different name, than that on the insurance contract, as this places AGRICORP’s auditing system in jeopardy. In conclusion, Mr. Fraser apologized for not having a farm visit to inspect the crop in the field but reiterated that AGRICORP believed the crop was not managed properly. He asked that the appeal be denied.

Mr. Enns apologized for the misunderstanding caused by shipping under the Peldale farm name. He explained that there was no intent to defraud and that there was some confusion due to Mr. Pillon’s divorce.

Mr. Fraser asked the Tribunal to include a determination of Mr. Pillon’s 1999 soybean yield in its decision. He said the AGRICORP 569-bu estimate was based on an error in calculation and that it should have been 609-bu. However, given the 8% dockage listed on the ADM weigh slip, AGRICORP would deduct 7% from the yield, as 1% foreign material is normal. This would result in a yield of 566-bu/acre. He noted that Mr. Pillon’s estimate was 480-bu/acre.

The Findings

The Tribunal finds that soybean yields in Essex County were reduced in 1999 due to a drought.

The Tribunal finds that weeds became more prevalent on Mr. Pillon’s farm in 1999, partially due to the drought. The Tribunal finds that Mr. Pillon applied Round-Up at a rate of something less than 1 litre/acre prior to planting soybeans in 1999. However, while this was below the recommended application rate, the Tribunal accepts Mr. Pillon’s testimony that the herbicide application provided an adequate burn down. The Tribunal finds that wicking was an acceptable rescue effort in this case. The Tribunal believes that Mr. Pillon had insufficient information on the seed he planted to allow him the confidence to apply Round-Up once the soybeans had emerged.

The Tribunal finds that both the late planting of the soybean crop and the failure of Mr. Pillon to rotate crops contributed to his low yield in 1999.

The Tribunal finds that the mishandling of Mr. Pillon’s claim report in the Guelph offices of AGRICORP eliminated the opportunity for AGRICORP field staff to inspect the crop in the field. The Tribunal notes that had the crop been inspected in the field, it may well have been determined that the crop was not worth harvesting.

The Tribunal finds that Mr. Pillon did not intend to misrepresent the selling of his crop by purchasing crop insurance in his own name and marketing soybeans under his farm name.

The Tribunal finds that the yield data provided by both parties was inconclusive.

Decision and Reasons

After careful consideration of the evidence and submissions made, the Tribunal decided to partially grant the appeal for the following reasons:

The Tribunal attributes Mr. Pillon’s soybean yield reduction in 1999 to a combination of insured and non-insured perils. The Tribunal found it difficult to determine the proportion of damage caused by drought and the proportion that was due to poor farm management. The Tribunal decided to proportion the damage on a 50/50 basis.

Order of the Tribunal

The Tribunal orders AGRICORP to record a yield of 569 bushels of soybeans from Mr. Pillon’s farm in 1999.

The Tribunal orders AGRICORP to pay Mr. Maurice Pillon a portion of his claim as follows:

Difference between what was produced and what was guaranteed:

Guarantee was 15.74 bu/acre - 7.59 bu/acre achieved = 8.15 bu/acre

Amount of claim to be paid:

50% * 8.15 bu/acre * 75 acres * $6.9038/bu price = $2,109.97.

DATED AT Guelph, Ontario this 20^th day of February, 2001.