AGRICULTURE, FOOD AND RURAL AFFAIRS APPEAL TRIBUNAL

APPEAL:

Koszycki v Agricorp

Koszycki v Agricorp 2007 ONAFRAAT 17

STATUTE:

Crop Insurance Act

HEARING:

April 30, 2007

DATE OF DECISION:

May 28, 2007

2007-17

NEUTRAL CITATION:

2007 ONAFRAAT 17

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 Mike Koszycki, Tilbury, Ontario from a decision of Agricorp concerning the adjustment of his claim for his 2006 soybean crop under Regulation 380/97 to the Crop Insurance Act (Ontario) and the Crop Insurance Plan for Grain and Oilseeds.

Before:

Kirk Walstedt, Vice Chair; Sharon Weitzel, Member; Doug Flook, Member

Appearances:

Mike Koszycki, appellant

Paul Courey, counsel to Mike Koczycki appellant

Mike Koszycki, witness on behalf of the appellant

Joe Koszycki, witness on behalf of the appellant

Pauline Koszycki, witness on behalf of the appellant

Shawn Mackay, witness on behalf of the appellant

Gerald Mailloux, witness on behalf of the appellant

Rebecca Given,s counsel to Agricorp, the respondent

Harry Frasier, witness on behalf of the respondent

Rosaire St. Pierre, witness on behalf of the respondent

Peter Fisher, witness of behalf of the respondent

DECISION OF THE TRIBUNAL

This appeal was heard in Ridgetown Ontario on Monday April 30, 2007. Mr. Mike Koszycki appealed to the Agriculture, Food and Rural Affairs Appeal Tribunal (the Tribunal) from the decision of Agricorp to deny his claim for yield losses on soybeans grown in the 2006 crop year.

Statutory Context

Sections 23 through 26 of Regulation 380/97 to the Crop Insurance Act (Ontario) state:

Claims

23.A claim for indemnity shall be made on a proof of loss form provided by AgriCorp and shall be filed with AgriCorp not later than 60 days after the insured crop was abandoned, destroyed, replanted or harvested. O. Reg. 380/97, s. 23.

24.AgriCorp may determine how claims will be adjusted. O. Reg. 380/97, s. 24.

25.The amount of indemnity shall be determined separately for each insured crop. O. Reg. 380/97, s. 25.

26.No indemnity shall be paid in respect of an insured crop unless the claimant establishes,

(a) the actual production from the crop; and

(b) that the loss in production resulted from one or more of the perils fixed by AgriCorp for the insured crop under section 5 of the Act. O. Reg. 380/97, s. 26.

Section 10 of the Crop Insurance Act (Ontario) states:

Referral of disputes

(1) If AgriCorp and a person disagree whether the 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, 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 Tribunal.

Notice of appeal

(2) To appeal a matter in dispute, the appellant shall file a written notice of appeal with the Tribunal and send a copy of the notice to the other party within the time specified by the regulations made under this Act.

Exclusive jurisdiction

(3) The Tribunal has exclusive jurisdiction to hear and determine all appeals arising under subsection (1).

Decision binding

(4) The decision of the Tribunal in an appeal is binding on the parties, 1999, c. 12, Sched. A, s. 7 (2).

The Issue

The issue before the Tribunal was:

Should Agricorp be ordered to pay the claim based on the reported yield of soybeans grown in 2006?

Preliminary Matter

The Tribunal ordered the exclusion of witnesses at the request of Ms. Rebecca Givens.

The parties had previously agreed that the testimony of witnesses at the hearing of the appeal of Mr. Joe. Koszycki related to his 2006 soybean crop would be considered as evidence for the appeal of Mr. Mike Koszycki. A summary of evidence from that hearing is appended to this decision.

The Evidence

Mike Koszycki

Mr. Mike Koszycki testified before the Tribunal. He stated that:

He had been farming for 60 years, and growing registered soybeans and wheat for 30 years.
He looked at the condition of the crop during the month of August 2006. At his 80 acre farm located near the Fourth Concession of Tilbury East, he drove into the field a few feet to look at the crop. He walked the length of an acre pushing the plants aside. He noticed the browning of the leaves, which was a normal sign of ripening, and one or two withered pods.
Agricorp paid claims on his crops in 2002, 2003, 2004 and 2005. Although he had reported pending claims before harvest, he had never been told by Agricorp that it was mandatory to do so.
At the time the Agricorp adjuster came to the farm to measure the contents of the bins, the full 2006 crop was stored in the bins.
His son Mr. Joe Koszycki provides the labour to harvest both their crops. The storage bins were emptied of all soybeans from the 2005 crop year at the time that Mr. Joe Koszycki began to fill them with the 2006 crop soybeans.
He assists at harvest by monitoring the machinery. He was very surprised to find that his 2006 yield was only 12 bushels per acre. The 2006 crop year was the lowest yield ever.

Mr. Mike Koszycki responded to questions, he stated that:

Due to a very wet Fall, the 2006 harvest was delayed.
Harvest of his 2006 soybeans was finished on or around December 9, 2006. He did not report the yield to Agricrorp until after the harvest was complete.
The yield was reported on or around December 19, 2006.
Mr. Peter Fisher signed the Crop Inspection Report which was dated January 17, 2007. Mr. Fisher attended at the home farm along with Mr. St. Pierre and Mr. Joe Koszycki on January 17, 2007. They met to measure the contents of the bins and to discuss his claim and Mr. Joe Koszycki’s claim.
He and Mr. Joe Koszycki do not usually report a pending claim until after harvest.
A Purchase Settlement Sheet from Great Lakes Grain dated October 16, 2006 (Exhibit 9, tab 6) indicates that 50.71 bushels were brought to the elevator that day. He believed that the Purchase Settlement Sheet was generated when Mr. Joe Koszycki took some seed to the elevator for cleaning.
None of the 2006 soybean crop was sold at any time prior to the on farm visit of Messrs. Fisher and St. Pierre, January 17, 2007.
Some 2005 soybeans were sold just prior to the beginning of harvest for the 2006 soybean crop.
He was familiar with the process for making crop insurance claims.
The 2006 soybean crop was grown from 2005 Sinclair variety bin run seed. The Sinclair variety is an early variety.

Joe Koszycki

Mr. Joe Koszycki gave evidence before the Tribunal. He said that:

In 2006 he grew soybeans for himself and his father using seed from the 2005 crop.
He sells his crop separately from his father’s crop. There was no mixing of his father’s 2005 soybean crop with the 2006 crop. All yield from the 2006 crop was reported to Agricorp. His evidence given on his own behalf for his appeal is equally applicable to his father’s appeal.

In response to questions, Mr. Joe Koszycki indicated he did not say that he planted 7.5 inch rows and when he was asked about row width said he used a no-till drill.

Peter Fisher

Mr. Peter Fisher told the Tribunal that he had been an adjuster with Agricorp since 1993. He testified that:

In addition to being an adjuster, he is a full time farmer with plenty of experience growing soybeans.
He holds a Diploma from Ridgetown College.
He made a visit to the home farm to verify the yield. The visit was prompted by the small size of Mr. Mike Koszycki’s yield in comparison to his neighbours’ yields.
As documented on the Crop Inspection Report (Exhibit 9, tab 5) he verified the yield when he visited the farm on January 17, 2007.
Mr. Mike Koszycki did not make a report of damage to the crop.
Adjuster Mr. St. Pierre had measured the contents of Mr. Mike Koszycki’s bin when he visited the home farm on January 10, 2007. He accepted the yield based on Mr. St. Pierre’s measurement.
He recalled meeting in the kitchen of the Koszycki home farm on January 17, 2007. Mr. Mike Koszycki, his son Mr. Joe Koszycki, Mr. St. Pierre and himself were in attendance.
Mrs. Pauline Koszycki, wife of Mr. Mike Koszycki, looked on as they met. She made a comment with respect to having told her son, Mr. Joe Koszycki that the soybean crop did not look good. Mr. Joe Koszycki admonished her to be quiet.
Farmers can determine sufficient plant population to support a reasonable yield at the time of emergence. Plants emerge about seven days after planting.
Near harvest is when a farmer would notice there are not enough pods; a crop with only one quarter the usual yield would be noticeable.

Mr. Fisher responded to questions. He stated that:

No one from Agricorp and neither Mr. Mike Koszycki nor Mr. Joe Koszycki notified him to request that he inspect the field for damage prior to harvest.
He determined that since there was no claim file open, there was no damage to the crop prior to harvest.

Harry Fraser

Mr. Harry Fraser gave evidence before the Tribunal. He told the Tribunal that:

Records of production for Mr. Mike Koszycki (Exhibit 9, tab 3) indicate that his average yield for soybeans in 2005 was 23.92 bushels per acre.
The Agricorp Customer Action Centre (ACAC) records indicate that Mr. Mike Koszycki’s yield report was made December 19, 2006.
In his search of the ACAC records, he could find no indication that Mr. Mike Koszycki had made any calls to ACAC during the period June through December 2006.
The ACAC records indicate that there was an adjuster inquiry on Mr. Mike Koszycki’s behalf on January 10, 2007. Although the current data (Exhibit 6) does not indicate the subject of the call, the inquiry was recorded because the call was made by an adjuster.
Mr. Mike Koszycki and Mr. Joe Koszycki attributed the low yield to the variety of soybeans grown.
He prepared the Agricorp Customer Crop History Report on yields for Mr. Koszycki.
With respect to the Agricorp GIS map (Exhibit 9, tab 9), Mr. Koszycki’s yield at the home farm is indicated to be less than thirty percent of average whereas neighbouring farms have yields of over 100 percent of yield.
Yield trial data from Ridgetown College (Exhibit 7) indicate that the Sinclair variety yields are average compared to other varieties grown on clay loam.

Mr. Fraser responded to questions; he stated that:

The yields indicated on the Agricorp GIS map (Exhibit 9, Tab 9) were obtained from crop grown solely at the locations indicated.
Agricorp paid claims to Mr. Mike Koszycki and to his son, Mr. Joe Koszycki in the years 2001 through 2005 without obtaining a damage report prior to harvest.

Pauline Koszycki

Ms. Pauline Koszycki testified before the Tribunal. She stated that:

She was present at the January 10, 2007 meeting of her husband, her son, and Agricorp Adjusters Messrs. St. Pierre and Fisher but she did not participate in the meeting.
No one told her not to speak while she was present.

Closing Arguments

Mr. Courey told the Tribunal that the appeals of Messrs. Joe Koszycki and Mike Koszycki were identical. He referred to Mr. Mailloux’s expert evidence as an impartial eye witness who observed the crop during the growing season.

Mr. Courey argued that Agricorp relied on an inconsistent interpretation of its policy with regard to reporting damage. He summarized the policy saying that the customer must report damage as it becomes known or as it ought to become known. Mr. Courey maintained that damage to the crop may not become evident until harvest. He reminded the Tribunal that Messrs. Koszycki were experience farmers who observed what appeared to be an average crop as it grew. Mr. Courey compared the credibility of Ms. Koszycki’s testimony with that of Mr. St. Pierre. He declared that Ms. Koszycki’s testimony was reliable whereas Mr. St. Pierre’s evidence was contradictory with respect to his call to the ACAC on January 10, 2007.

Mr. Courey stated that the matter before the Tribunal was whether or not Messrs. Koszycki obtained the yields that they reported. He maintained that Agricorp had conceded the point that it could not find evidence that any soybeans were sold or otherwise unaccounted for, from the yield reported.

He reminded the Tribunal that Mr. Joe Koszycki had telephoned Agricorp at the beginning of harvest when he noticed that the yield was low. He said that Mr. Joe Koszycki did as he was told by the representative at ACAC which was to continue the harvest and then report the yield. Mr. Courey stated that Mr. Joe Koszycki reported the yield in a manner consistent with Agricorp’s policy.

Mr. Courey said that Mr. Mike Koszycki walked the field during the growing season and was satisfied that the crop looked as it should for that time of year. He referred to Mr. Mackay’s evidence that there was sufficient stubble in the field to indicate a stand that had a sufficient number of plants to produce a reasonable yield. Mr. Courey objected to Agricorp’s refusal to pay the claim based on the legal provisions of estoppel, acquiescence and latches whereby, Agricorp had followed a procedure for assessing yield/damage and paying claims over several years for both Messrs. Joe Koszycki and Mike Koszycki under contracts of insurance, but that in 2006 it deviated from the established procedure.

Mr. Courey requested that the Tribunal pay the claim(s) of Messrs. Joe and Mike Koszycki based on the reported yields. He reminded the Tribunal that both appellants had made claims under contracts of insurance and that the claims remained unpaid. He requested that the Tribunal grant the appeal(s) and that Agricorp pay the offered reseeding benefit. He stated that the low yield was attributed to poor weather, and that claims were made by Messrs. Joe and Mike Kosycki in the same manner in which they had been make in five consecutive years prior to 2006.

Mr. Courey referred the Tribunal to case law with respect to the obligation to perform and to the definition/principles of latches and acquiescence under civil practice and procedure.

Ms. Givens made closing arguments before the Tribunal. She stated that the request for payment of reseeding benefit was unreasonable based on the appellants’ rejection of the reseeding offer: they maintained that there was no reason to reseed. Ms. Givens reminded the Tribunal that the subject of the appeals was for full payment of claim.

Ms. Givens told the Tribunal that the claims were not payable because the appellants were in breach of the contract of insurance due to non reporting of damage, non reporting of carry over crop, and the unproven allegation that damage to the crop was caused by an insured peril.

Ms. Givens referred to Section 14 of Regulation 380/97 to the Crop Insurance Act which provides for no amendments to the contract of insurance without the written consent of Agricorp. She referred to the Contract of Insurance defining the contract and governing good farm management practices. Ms. Givens reminded the Tribunal that the Contract of Insurance provides for the payment of reseeding benefits and sets out the provisions for the reporting of damage. She maintained that the according to the Contract of Insurance the insured is responsible for proving the stated yield and that any loss is a result of an insured peril.

Ms. Givens cautioned the Tribunal with respect to assessing credibility, she stated that Mr. Joe Koszycki contradicted his own testimony by first stating that the soybeans were planted with 7.5 inch row spacing in 2006 and then stating that he only responded to a question about what type of seed drill he owned. Ms. Givens submitted that Mr. Joe Koszycki’s testimony was contradictory to her recollection of it. She stated that the testimony of Messrs. Mackay and Mailloux were also questionable with respect to their observations regarding row spacing. She stated that Mrs. Koszycki’s testimony that she did not make a comment with respect to the crop looking poorly during the growing season could not be relied upon because she was not an unbiased witness.

Ms. Givens argued that the ACAC records indicated that Mr. St. Pierre had made a call to the ACAC on January 10, 2007 and that if Mr. Joe Koszycki had called the ACAC there would also be a record of the call referenced by a confirmation number. Ms. Givens submitted that the appellants’ indicated that the cause of loss was due to the variety of soybeans planted. She stated that poor choice of variety is not an insured peril under the contract.

Mr. Courey replied to Ms. Givens submissions stating that the offer to pay reseeding benefits had been neither revoked nor had reseeding benefit been paid. He stated that there was no evidence to suggest that Mr. Joe Koszycki did not employ good farm management practices. He said that the Tribunal was at liberty to consider both sides of the argument with regard to credibility. Mr. Courey reminded the Tribunal that the corroborated evidence of the witnesses was that the Spring and Fall of 2006 was very rainy and wet.

The Findings

The Tribunal finds the testimony of the appellant and his witnesses to be credible. All of the witnesses, including those speaking on behalf of Agricorp, were forthright and compelling in their testimony. Their testimony was congruent despite the exclusion of witnesses.

The Tribunal acknowledges the discrepancy in the testimony of Mr. Joe Koszycki with respect to row width, but was satisfied that he was not being evasive and was not unable to recall how he planted the 2006 crop. The Tribunal finds that whether he planted in 30-inch rows or less, with the seeding rate of 2.5 bushel/acre that he used this would not affect his overall yield.

A letter from Mr. Harry Fraser ((Exhibit 1, document 10) indicated that Agricorp denied the claim for three reasons:

Low yield relative to high yields of other growers in the area;
No damage reported during the growing season;
A high proportion of re-seeds in the area in Spring 2006.

The Tribunal did not find the yields indicated on the GIS map submitted by Agricorp to be compelling evidence. The Tribunal notes that the yields reported on this map were the combined yields of all farms cropped by each individual farmer, and were not necessarily comparable to the yields that could be expected in the areas where Mr. Mike Koszycki’s soybeans were grown. The Tribunal does not fault the appellant for growing the Sinclair variety as both parties agreed the variety was appropriate for the area in question.

The Tribunal heard testimony from the appellant, his son and Mr. Mailloux that there was no damage to the crop evident when they viewed it during the growing season. Mr. Mackay’s data on the stubble left in the fields in March 2007 indicated there were sufficient plants. As well, Mr. Mike Koszycki testified that he had never been required to report damage during the crop year in previous years, notwithstanding the contract provision that damage be reported as soon as it is evident. The Tribunal finds that there was no evidence to support Agricorp’s contention that crop damage should have been reported earlier in the season. As well, the Tribunal accepts Mr. Courey’s argument with regard to estoppel.

The Tribunal notes that re-seeding is not mandatory. The testimony of Mr. Mike Koszycki was that emergence was normal. This is supported by the data on the stubble provided by Mr. Mackay and Mr. Mailloux.

The un-contradicted evidence of Mr. Mailloux was that the crop was damaged by excessive rain in the Spring and Fall. Excessive moisture is an insured peril and the Tribunal finds that the claim should be paid.

The issue as to whether or not an un-seeded acreage benefit should also be paid was not the subject of this appeal and the Tribunal will not rule on it.

Decision and Reasons

After consideration of the evidence and submissions made, the Tribunal grants the appeal of Mr. Mike Koszycki with respect to the adjustment of his claim for yield losses on soybeans grown in 2006.

The reasons for this decision are:

There is convincing evidence that the crop in question was damaged by excessive rainfall which is an insured peril.
Agricorp’s acknowledgement that the actions of Mr. Koszycki for reporting his 2006 claim did not differ from the process used by him in the years 2001, 2002, 2003, 2004 and 2005 for the claims he submitted, all of which were processed and paid by Agricorp.

ORDER OF THE TRIBUNAL

The Tribunal orders Agricorp to pay the appellant’s claim based on the 2006 soybean yield reported on his Proof of Loss Form.

The Tribunal orders this payment to be made within two weeks of the date of this order.

DATED AT Essex, Ontario this 28^th day of May, 2007.

Summary of Evidence from Joe Koszycki v. Agricorp Hearing

Joe Koszycki

Mr. Joe Koszycki gave testimony before the Tribunal. He stated that:

He farmed 330 acres of cash crops including soybeans, wheat and corn.
The farms he crops are located in the Town of Lakeshore and the Municipality of Chatham-Kent.
He farms for himself and on behalf of his father, Mr. Mike Koszycki. His father owns farms separate from his. His father’s crops are grown, harvested and stored separately from his crops.
There are separate crop storage bins on the home farm for his and his fathers’ crops. The crops are never mixed.
He and his father pay for all inputs for their respective crops separately.
His crop is sold separately from his father’s crops
Prior to 1995, Mr. Mike Koszycki farmed his own lands.
In total he farms 146 acres of his own land and land rented in his name at two different locations. He also farms 182 acres for Mr. Mike Koszycki at three different locations.
In 2006 only soybeans were grown on all of his and Mike Koszycki’s farms.
He had purchased crop insurance since 1984. Agricorp had never denied an insurance claim prior to 2006.
Weather conditions were normal in Spring 2006 but it became rainy and cold beginning in May. The crop was not planted in its entirety before the wet cold weather set in.
He filed a Crop Inspection Report signed by himself and Crop Adjuster, Mr. Rosaire St. Pierre on January 10, 2007 for 2006 soybeans (Exhibit 1, document 14) Planting of the crop referred to in the January 10, 2007 Crop Inspection Report was completed on June 8, 2006.
Due to wet, cold weather planting was sporadic. The bulk of planting took place in early June 2006. Many farmers in his area had to replant crops that were planted in early May. The soil at all the locations that he farms is mostly clay loam.
The crop was seeded at the rate of two bushels of seed per acre according to his usual practice. All acres planted were fertilized.
There were no weed control issues; however two separate treatments of herbicide were used. One treatment of Roundup® was applied to the soil prior to planting and Classic® was applied, also before planting.
The crop appeared normal at the time of emergence.
The crop was observed throughout the season. It appeared normal, although the variety planted was not as tall as other varieties by mid-August.
Although most of his land is systematically tile drained, the soil type drains poorly. Excess rain during the growing season contributed to the saturation of the plant roots.
The drainage on one of his farms was adversely affected by the poor maintenance of a roadside ditch. The tile outlets into the roadside ditch.
By early September the crop appeared to be slightly more mature than usual for that time in the season.
Soybean harvest usually begins in late September through late October; however a rainy fall delayed the harvest. He harvested the crop in November when frost had caused the soil to harden enough to support the combine.
Soybeans will not remain in a condition suitable for harvest indefinitely.
He began the harvest at night when the soil was firmest.
After making a few passes with the combine he realized that the bin was not filling to the level expected given the amount of crop harvested.
The first night of harvest he combined 50 acres. He was concerned as he went to sleep the next morning. He telephoned Agricorp upon waking and stated that he anticipated making a claim.
The Agricorp representative with whom he spoke asked if the harvest was completed. He replied that it was not. He was advised to call Agricorp to open a claim when he had finished harvesting and had recorded the total amount of beans. He was told that a confirmation number would be issued at that time.
He continued to harvest the soybeans. The yield was very low.
Mr. Gerald Mailloux, Location Manager, Agris Co-operative wrote a letter stating his opinion about the cause of the poor yield. The letter was sent to Mr. Rosaire St. Pierre, Adjuster for Agricorp.
Agris Co-operative supplies all the input materials for his farming operation.
He put the soybeans in their respective bins at the home farm. There was no mixing of his crop with Mr. Mike Koszycki’s crop.
No beans were sold or unaccounted for.
Soybeans delivered to Thompson’s Limited in November 2006 were soybeans grown in the 2005 season. He also delivered a few small lots of 2005 soybeans to Agris Co-operative in November 2006.
Soybeans were held over from the 2005 crop year in the hope that the price would increase over time. They were removed from the bins to make room for the 2006 crop.
He completed the harvest of his farms first and then completed harvesting Mr. Mike Koszycki’s crop. Harvest of both crops was completed in December 2006.
He telephoned Agricorp in November 2006 to report the shortfall on his farms only. He signed the Proof of Loss form on December 22, 2006. He reported an estimated shortfall of 3,054.23 bushels from both his and Mr. Mike Koszycki’s farms.
He received a confirmation number from filing the Proof of Loss and was informed that Agricorp was going to open a claim.
Mr. Rosaire St. Pierre, Adjuster, re-measured the contents of the bin January 10, 2007. Mr. St. Pierre was satisfied that the yield for 2006 was 1,564 bushels and recorded it on the Adjuster’s Special Report dated January 10, 2007.
Mr. Mike Koszycki, Mrs. Pauline Koszycki and he were present when Mr. St. Pierre made a call to Agricorp inquiring whether a damage report had been filed in Summer 2006. The Agricorp representative with whom Mr. St. Pierre spoke informed him that there did not appear to be a damage report on file, however, there was a record of a call made in summer 2006 indicating that there may be damage to the crop. The Agricorp representative informed Mr. St. Pierre that Agricorp was notified of a pending claim sometime in November 2006.
Mr. Harry Fraser Regional Manager, Agricorp informed him by way of letter dated February 12, 2007 that it was only prepared to offer him a reseeding benefit in the amount of $9,499.00. He had not accepted the payment.
The 2006 soybean crop was planted with Sinclair variety seed harvested from the 2005 crop. It was cleaned before planting.
He planted the Sinclair variety from certified seed for the first time in 2005.
It is a normal practice for farmers to plant seed harvested from the previous year’s crop.
He believed that the Sinclair variety could not withstand the wet windy weather in the 2006 growing season.
Despite the fact that the Sinclair variety is licensed for growing in Ontario, he would not plant it again; it is susceptible to root rot. He was not aware that any other farmer in his area grew the Sinclair variety.
He did not open a damage report prior to harvest.
He had never previously been prevented from making a claim after harvest was complete.
He had made claims in previous years but an Adjuster had never attended at the farm to inspect the yield. In years past, Agricorp had never explicitly informed him that he may not make a claim after the crop was harvested.
In his estimation, the number of farmers in his area who reseeded crops in 2006 was similar to any other year.
His 2006 soybean stand was healthy, which gave no indication that there was any need to reseed the crop.

Mr. Joe Koszycki responded to questions. He told the Tribunal that:

He planted the Sinclair variety in 2005 and 2006 only. He made a claim for the 2005 crop due to drought.
He performed a germination test on the 2005 seed used to plant the 2006 crop; he did not treat the seed or conduct any other tests.
The 2006 crop emerged normally.
Mr. Gerald Mailloux, Branch Manager, Agris Co-operative Limited, described the circumstances (in a letter dated April 9, 2007) where Mr. Roger Bourassa inspected his crop on July 10, 2006. Mr. Mailloux stated that Mr. Bourassa, a Sales Representative for Classic®, found no issues with inadequate plant population.
The crop was sprayed with herbicide twice. Weed control was not an issue; the application of herbicide did not affect the crop.
In July and August the crop appeared normal. Due to wet conditions in October he did not walk the fields but only observed the crop from beside the fields.
He began harvesting at night in mid-November and completed harvesting his farms on November 19, 2006.
He observed the crop the day before harvest; however, he did not walk the fields to inspect it. There was minor wind damage to a few of the plants and the occasional pods were lying on the ground. In 2005 the crop was in better condition at harvest than it was in 2006.
The harvest was not reported to Agricorp until December 19, 2006 because he completed the harvest of Mr. Mike Koszycki’s farms after he harvested his own farms.
The yield was approximately 10.7 bushels per acre.
Upon waking in the day following the night harvest, he telephoned Agricorp because he was concerned about the low yield.
He was not given a confirmation number related to the call. He had received confirmation numbers for calls he had made to report harvests and unseeded acreage in years past. He had no written record of the call.
On the Proof of Loss form, he reported that the cause of loss was excessive rain. He had never seen such constant wet conditions from June through September, in all his years of farming.
When Mr. Rosaire St. Pierre attended at the farm on January 10, 2007, he measured his crop and Mr. Mike Koszycki’s crop.
He believed his mother, Mrs. Pauline Koszycki, was present during discussions when Mr. St. Pierre attended at the farm on January 10, 2007, however, she did not participate in the conversation.
He declined to sign Agricorp’s Non-Waiver Agreement before consulting with his solicitor.
Mr. St. Pierre and Mr. Peter Fisher, Adjuster, attended at the farm on January 17, 2007. Mr. St. Pierre completed and signed the Adjuster’s Special Report on January 10, 2007.
It appears that he neglected to report the carry over crop from 2005 before starting the harvest of the 2006 crop.
He could not recall the precise date on which he began harvesting the 2006 crop. He could only estimate the start date given that he is certain that he finished harvesting his crop in December 2006.
He had approximately seven wagons containing 2005 soybeans that were marketed to Thompson’s on contract November 9, 2006 and November 23, 2006. The storage bins were empty of any soybeans before he began to put the 2006 crop into them.
He had a signed contract with Thompson’s for 2005 soybeans. He was paid a premium for storing the soybeans. He was not aware that he was obligated to report carry over crop to Agricorp.
He had made a crop insurance claim every year for the past five years.
He was aware of the necessity of making a damage report as it relates to making a claim.
He believed that most local farmers grow Roundup® ready soybeans.
It would be unusual for Agricorp not to issue a confirmation number when customers telephone their final acreage reports. It would be likely that a confirmation number is issued for customers who make a damage report, however, it would not be reasonable for Agricorp to record a confirmation number for each and every call that customers make.
There was no mixing of the 2005 and 2006 soybean crops. The remains of the 2005 crop were in wagons however the 2006 crop was conveyed to the bins in the grain buggy.
His yield in 2005 was approximately 28 bushels per acre.

He made claims in the years 2001 through 2005; yields in those years were not as low as the yield in 2006. He did not report the expectation of making a claim prior to harvest in the years 2001 through 2005.

Agricorp paid his claims in the years 2001 through 2005.
In 2006, the soil temperature was 22°C to 27°C during planting. He uses the minimum till method; the soybeans were planted at a depth of two and a half inches.
He used a Sunflower type drill with 7.5 inch rows.
In 2006 he was in the third year of a three year rotation for soybeans.
He had never previously reported carry over crop before harvesting in-year

crop.

He characterized the 2006 crop as “maturing too quickly” because the plants became discoloured and some leaves had fallen off.
He considered the definition of “damage” to a crop to be pods fall off, disease or lodging is observed.

Shawn Mackay

Mr. Shawn Mackay testified before the Tribunal. He stated that:

He is employed by Agris Co-Operative Limited supervising employees, operating grain elevators and trucking agricultural inputs.
He was instructed in a method of counting plant stubble by walking the field and counting the stubble found within the circumference of a hoola-hoop thrown at random.
He used the hoola-hoop method of counting plant stubble while walking Mr. Mike Koszycki’s and Mr. Joe Koszycki’s fields.
He referred to his three hand drawn sketches of the patterns walked and the the counts obtained. He was not apprised of any reason why he was asked to count the plant stubble before doing so.
He was able to distinguish between wheat, soybean and corn stalk stubble.
He provided sketches of the patterns walked in each field and the plant stubble counts obtained, (Exhibit 1, documents 1, 2, 3 and 4) however, he did not make the noted calculations regarding plant density per acre.
He was not accompanied by anyone during his walk of the fields.
He believes he obtained a representative sample of the number of plants grown in the field.

Mr. Mackay responded to questions. He stated that:

He counted the plant stubble in the fields in the week of March 14, 2007. There was no snow on the fields at the time of counting. Most of the stubble was three inches tall.
He could not see any evidence of root rot from looking at the plant stubble. It was not possible to speculate on the condition of the crop grown from the stubble as it had been harvested. Some stalks of grass were evident.
He was quite certain that he counted only bean stalks.
He is certain that the field located at the 5^th Concession is cropped using no till methods. The rows of plant stubble were 30 inches apart.

Gerald Mailloux

The Tribunal determined that Mr. Gerald Mailloux be considered an expert witness, limited to crop input management for the geographic are in which he lives and works, based on his credentials and experience as follows:

He had been the Manager of Agris Co-operative Limited (Agris) since 1999. Agris is a retailer of crop seeds, fertilizer, pesticides and source of advice with regard to the application of its merchandise. He had held several positions within Agris over a period of several years.
He had received accreditations such as Certified Crop Advisor, licensed pesticide retailer, exterminator, certification in pesticide and fertilizer application and the appropriate licenses to operate the Agris facility.
He held an Honours Certificate in Agricultural Production Management from Ridgetown College.
He had farmed for over 25 years.

Mr. Mailloux testified that:

Mr. Joe Koszycki’s home and farms are near to where he lives. Mr. Joe Koszycki is also a customer of Agris Co-operative Limited.
He cash crops soybeans and corn on similar soil to that found on Koszycki’s farm.
He travels past Mr. Joe Koszycki’s farms often, on his way to work and to the town of Tilbury.
He observed the crops on Mr. Joe Koszycki’s farm throughout the year.
Mr. Joe Koszycki had concerns with weed treatments and sought advice from an Agris staff member. An Agris staff member and herbicide wholesaler representative inspected Mr. Joe Koszycki’s field and it was decided that a second application of herbicide Classic® should be applied. Classic® was also applied before the soybean crop was planted.
Numerous farmers in the area had to re-seed early planted corn and soybeans in Spring 2006 due to wet weather.
On his own farm he replanted corn with soybeans.
The timing of Mr. Joe Koszycki’s planting was fortunate in that he avoided the rainiest part of Spring 2006.
Mr. Joe Koszycki planted his soybeans in rows spaced 30 inches apart.
Depending on the variety of soybeans planted, mid-September is generally the earliest time for harvest to begin. Harvest usually begins in October in the Tilbury area.
In the Tilbury area, most of the 2006 crop was harvested in mid-October through November 2006.
He described Mr. Mackay’s activities in a letter addressed to Mr. Courey dated April 9, 2007 (Exhibit 2, document 2).
He believed that Mr. Mackay obtained an accurate representation of the number of soybean plants in the fields.
Based on Mr. Mackay’s data, he made calculations to estimate that: at Mr. Mike Koszycki’s home farm there were 188,803 plants per acre; at the farm located at Highway 46 (117 acres cropped for Mr. Joe Koszycki and 49 acres cropped for Mr. Mike Koszycki) there were 174,487 plants per acre; at Mr. Mike Koszycki’s farm located at the 5^th Concession and Richardson Road there were 146,079 plants per acre and at Mr. Joe Koszycki’s farm located at Highway #2 there were 147,343 plants per acre.
A rate of 110,000 plants per acre spaced in 30 inch rows could be expected to produce a good yield.
Except for Mr. Joe Koszycki, he was not aware of any other farmer who grew only the Sinclair variety of soybeans.
He observed a farm in the region where the Sinclair variety was planted in close proximity to another variety; it was evident that the non-Sinclair soybeans looked healthier. If comparisons between varieties are to be made, the soil type should be similar across all the compared varieties.
He understood how the crop insurance system operated.
A plant specialist from Ridgetown College visited an area farmer and diagnosed Rhizoctonia Root Rot in the Sinclair variety. The disease prevents the plants from reaching their full height and maximum yield potential. Loss from Rhizoctonia Root Rot can amount to as much as 60 percent. He did not have any documentation to support his observations of the local farmer.
He wrote a letter on Mr. Joe Koszycki’s behalf where he expressed the view that excessive rain followed by warm dry weather created ideal conditions for the growth of Rhizoctonia Root Rot. He stated in the letter that the Sinclair variety was particularly susceptible to Rhizoctonia Root Rot.
He maintained that the opinions expressed in the letter are accurate.

Mr. Mailloux responded to questions, he told the Tribunal that:

The Ridgetown College specialist did not examine or diagnose Rhizoctonia Root Rot in the soybeans at Mr. Joe Koszycki’s farm or any of the acreage that he grew on behalf of his father Mr. Mike Koszycki.
He personally observed the plants that were formally diagnosed with Rhizoctonia Root Rot. In comparison to other unaffected plants the difference was marked.
Agris sold the crop inputs to Mr. Joe Koszycki and his father Mr. Mike Koszycki for their 2006 soybeans crop.
Agris customers are advised to conduct a germination test if they are using bin run seed. Mr. Joe Koszycki did not request that Agris perform a germination test on the seed.
Signs of Rhizoctonia Root Rot are not evident from observing plant stubble, nor is it possible to determine the size of the plant from the stubble.
In circumstances where a soybean crop yield is only one quarter of the yield normally expected, it becomes apparent very quickly at the beginning of harvest, however it is very difficult to determine yield by observing the soybean plants.
There is a positive correlation between the height of soybean plants and the size of yield; however, there are exceptions to the corollary.
From his visual observations driving past Mr. Joe Koszycki’s and Mr. Mike Koszycki’s fields, he thought the crop looked good
The Sinclair variety of soybeans is an IP (Identity Preserved) variety; IP varieties command a premium price that compensates for some yield drag.

Mike Koszycki

Mr. Mike Koszycki, father of the appellant, Mr. Joe Koszycki, testified before the Tribunal. He stated that:

He was no longer actively farming; his son, Joe Koszycki, farms on his behalf, as well as farming his own fields.
He had owned and farmed the property referred to as the “home farm” for 63 years and the farm referred to as farm #3 for 60 years (Exhibit 1, document 1).
In 2006, he and his wife checked the crops grown by their son twice a week. The soybeans appeared to be healthy and the fields looked good.
He was home during harvest, though not actually in the fields.
Although his son Mr. Joe Koszycki provided the labour to grow the soybeans, he contracted for the crop in his own name and his wife’s name. His son grows and sells his soybeans for him. The respective soybean crops are stored in separate bins.
In 2006 it was very rainy during the harvest season.
Mr. Joe Koszycki was forced to delay the harvest until the frost supported the equipment on the fields.
Some carryover soybeans were stored in the bins at the beginning of harvest, 2006; however, they were removed and sold before the 2006 crop was placed in the bins.
There was no mixing of the 2005 soybeans with 2006 soybeans.
Mr. Joe Koszycki carried over the 2005 soybeans in the expectation that the price would increase.
In 2006, Mr. Joe Koszycki’s yield was approximately 13 to 15 bushels per acre. Yields from his own farms were a bit higher at almost 20 bushels per acre; however, yields in 2006 were the poorest he had seen in many years.

Mr. Mike Koszycki responded to questions, he stated that:

He observed the crop in the Fall of 2006. He sampled some of the pods from the side of the field as it was too wet to walk the fields. Some of the pods had no soybeans in them. Mr. Joe Koszycki knew that there were some pods with no soybeans in them however they both knew that there were many pods with ample soybeans in them.
Mr. Joe Koszycki called Agricorp about the low yield just after he began harvesting; he was not present during the call.
He recalled that Mr. Peter Fisher and Mr. Rosaire St. Pierre attended at the home farm to prepare a report. His wife was in the kitchen where they were meeting but she did not participate in the meeting.

Pauline Koszycki

Mrs. Pauline Koszycki testified before the Tribunal. Mrs. Koszycki explained that:

She lives at the home farm with her husband Mr. Mike Koszycki and son Mr. Joe Koszycki.
She regularly observes the crops and walks the fields. The 2006 crop looked good. In early August 2006, she believed that the yield would be approximately 30 bushels per acre.
Weather in the Fall of 2006 was rainy and wet. She and her husband observed the fields from the car in the Fall because it was too wet and muddy to walk the fields.
In January 2007, there was a meeting in her kitchen. Her husband, her son, Mr. Rosaire St. Pierre and Mr. Peter Fisher were in attendance. She did not participate in the meeting.

Mrs. Koszycki responded to questions. She told the Tribunal that:

She had grown soybeans and farmed with her husband Mike for 60 years.
She had participated in every aspect of growing crops on the farm.
The 2006 crop was the poorest yield she had ever seen in many years of farming.
From her observations of the crop throughout the season, she expected at least a fair yield.

Harry Fraser

Mr. Harry Fraser gave evidence before the Tribunal. He stated that:

He had worked for Agricorp for 20 years and was currently the Regional Manager for Essex West Kent. His duties include approving claims.
He had personal experience farming one thousand acres which included growing soybeans.
Mr. Joe Koszycki’s crop insurance coverage for 2006 was 90 percent of his Average Farm Yield (AFY). His AFY for 2006 was 35.20 bushels per acre. Mr. Joe Koszycki had telephoned Agricorp to request an increase in the percentage of his coverage from the previous year.
Each time a customer calls the Agricorp Customer Action Center (ACAC), a record of the call is made. Mr. Joe Koszycki made a telephone call to the ACAC on December 19, 2006 to report that he had completed harvesting his 2006 soybean crop on November 19, 2006 (Exhibit 2, tab 4).
A confirmation number is generated from each call, however the confirmation number is not listed on the ACAC record.
He referred the Tribunal to the ACAC records of Mr. Joe Koszycki’s telephone calls during the period from April 24, 2006 through April 10, 2007 (Exhibit 3). A record of the ACAC autodial reminders to customers is included.
Mr. Joe Koszycki did not call the ACAC about damage to the crop during the period June 2006 through Decmeber 2006.
He wrote a letter to Mr. Joe Koszycki dated February 12, 2007(Exhibit 2, tab 5). In his letter he indicated that Mr. Joe Koszycki’s yield for 2006 soybeans was very low, that no damage report had been made and that 96 farmers were approved for coverage for reseeding in the township in Mr. Joe Koszycki’s township.
Mr. Joe Koszycki was offered a reseeding benefit payment.
Agricorp was not afforded the opportunity to determine that the low yield was caused by an insured peril.
Agricorp obtained a signed authorization from Mr. Joe Koszycki to allow it to investigate the disposition of soybeans in order to verify the 2006 yield.
Records of deliveries of soybeans to elevators indicated that 2005 soybeans were sold however it could not be determined conclusively that no 2006 soybeans were sold.
Agricorp plotted the yields of its customers on a map (Exhibit 2 tab 9).
He prepared a crop history report for Mr. Joe Koszycki that showed his AFY and claim history from 1993 (Exhibit 2, tab 9).
Each customer’s yield is indicated by a colour coded dot representing a percentage the AFY. Mr. Joe Koszycki’s yield is very low as compared to that of three of his neighbours who produced 130% of their AFY. The average yield in the area of Tilbury West was 40 bushels per acre.
Graphed results from soybean trials undertaken by Ridgetown College indicated that the Sinclair variety has average yields in comparison to other varieties suitable for Ontario 2900 – 3300 heat unit locations such as Mr. Joe Koszycki’s farms.
He had seen cases of Rhizoctonia Root Rot; depending on the severity of the disease, the crop can be harvested.
Agricorp expects it customers to report damage as soon as it becomes apparent to the customer.
When customers call the ACAC to report damage, a record is prepared and an adjuster is assigned to investigate.
The number of pods per plant becomes apparent in late July to August. It is not possible to estimate yield or to diagnose plant diseases from an analysis of plant stubble left over from harvest.
It is unlikely that a yield as low as one quarter of average would go unnoticed until after the beginning of harvest.
In Mr. Joe Koszycki’s case, the low yield was in contrast to the higher yields obtained by his neighbours.

Mr. Fraser responded to questions. He explained to the Tribunal that:

An Authorization Form to Obtain Yield Information (AFOYI) was signed by Mr. Joe Koszycki on January 23, 2007. An adjuster was sent to local commodity boards to investigate Mr. Joe Koszycki’s sales of soybeans.
The AFOYI gave Mr. Joe Koszycki’s consent to search records of sales from 2002. The sales records were inconclusive as to whether soybeans sold were from the 2005 crop year or the 2006 crop year.
During the investigation he became concerned that there were sales of unreported carryover from 2005. Carryover must be reported to Agricorp. It should be reported before the beginning of harvest of any in-year crops.
It would have been possible to compare Mr. Joe Koszycki’s reported yield from 2005 with his sales. To have done so, would have resulted in more conclusive reconciliation of the disposition of the crops for 2005 and 2006.
The ACAC receives a high volume of telephone calls each year; it is impossible to know of circumstances where customers should have called by failed to do so.
In the area that he serves as Regional Manager no customers made calls to inform Agricorp that they had carryover crops.
He had no records indicating when customers in his area sold 2006 soybeans.
Only the home farm locations of customers are indicated on Agricorp’s map depicting yields as a percentage of AFY for 2006 (Exhibit 2, tab 9). He had not performed any analysis of the data indicated on the map; however, some customers such as Mr. Joe Koszycki grow soybeans at locations other than their home farms.
Mr. Joe Koszycki attributed his loss in 2005 to drought. He grew the Sinclair variety in 2005 and 2006. Although it was a poor management decision to grow the Sinclair variety again in 2006 after having a loss with the same variety in 2005, Mr. Joe Koszycki was not in contravention of the contract of insurance by doing so.
The soil type and heat units at Mr. Joe Koszycki’s farms are very similar to those conditions under which soybean trials were undertaken by Ridgetown College (Exhibit 2, tab 9).
Plant stubble is clearly visible in March of the year following harvest; however, it is difficult to diagnose root rot from plant stubble.
The amount of plant stubble is indicative of the size of the stand.
Agricorp adjusters have the authority to approve claims up to $25,000.00. However, in cases where the yield is less than 50 percent of the AFY, claims are reviewed. Mr. Joe Koszycki’s 2006 yield was less than 50 percent of his AFY.
He reviewed the claim by comparing Mr. Joe Koszycki’s yield to other customers’ yields in the same area and reviewing the crop inspection report. He did not interview Mr. Joe Koszycki with regard to reviewing the claim.
A claim cannot be denied because the yield is low.
He agreed that the Spring and Fall of 2006 were rainy and the harvest was delayed. Wet conditions are conducive to root rot.
Mr. Joe Koszycki’s stated cause of the low yield was excess moisture; excessive moisture is an insured peril.
He offered the reseeding claim in order to give Mr. Joe Koszycki the benefit of the doubt.
If no other conditions affected the crop, it is reasonable to conclude that the plant population indicated from Mr. Mackay’s hoop count was adequate to provide a reasonable yield.
Mr. Joe Koszycki was paid a claim in each of the five years prior to 2006. He is reasonably certain that no damage report was ever opened with respect to the claims from the years 2001 though 2005.
His knowledge of how the ACAC handles telephone calls was obtained by observing the operations of the call center when visiting Agricorp’s head office.
Mr. Joe Koszycki’s non-reporting of carryover crop did not become evident until after the adjuster had met with him.
Everyone who saw the crop indicated that it looked as if it might provide a good yield. A damage report should have been opened before harvest began or no more than five days after harvest had begun.
The claim would have been paid if the carryover had been reported and a damage report made.
There remain some questionable circumstances surrounding the 2006 crop, such as the transportation of the beans by buggy when Mr. Joe Koszycki owned wagons. The questionable circumstances cannot be verified.
In previous claim years adjusters found that Mr. Koszycki’s reported yield was very close to the yields obtained by the adjuster investigating the claims.

Rosaire St. Pierre

Mr. St. Pierre testified before the Tribunal. He stated that:

He had been an adjuster with Agricorp since 1987. He was also a farmer and had grown soybeans for over 50 years.
He was informed of Mr. Joe Koszycki’s claim by way of an e-mail message from Agricorp, about two days before Christmas 2006.
Due to the holiday season he did not attend at the farm to verify the yield until January 10, 2007. He prepared the Adjuster’s Special Report signed by himself and Mr. Joe Koszycki on January 10, 2007.
The contents of the storage bins were measured on January 10, 2007 and the resulting yield found to be within a couple of bushels of the yield initially stated by Mr. Joe Koszycki.
A Crop Inspection Report was also prepared on January 10, 2007 (Exhibit 2, tab 5). The Crop Inspection Report included Mr. Joe Koszycki’s description of the weather and condition of the crop appended with an undated letter from Mr. Gerald Mailloux, Location Manager, Agris Co-operative. Mr. Mailloux had seen the crop in the field during the growing season 2006.
When he became aware that Mr. Joe Koszycki grew insured soybeans on behalf of his father, Mr. Mike Koszycki, he decided to inform Mr. Mike Koszycki’s adjuster of the low yield. Mr. Peter Fisher was Mr. Mike Koszycki’s adjuster.
He met with Mr. Joe Koszycki, his father Mr. Mike Koszycki and Mr. Peter Fisher on January 17, 2007 to discuss the soybean crops. They met around the kitchen table at the home of Mr. Joe Koszycki and his father Mr. Mike Koszycki.
During the discussion Mrs. Pauline Koszycki came into the kitchen and made the comment that she told Mr. Joe Koszycki in Summer 2006, that there was something wrong with the soybeans. Mrs. Koszycki was rebuked into silence by Mr. Joe Koszycki.
Mr. Joe Koszycki signed an Authorization Form To Obtain Yield Information on January 17, 2007 however it was damaged and a new form was re-signed on January 23, 2007 (Exhibit 2, tab 5).
A GIS Map generated by Agricorp (Exhibit 2, tab 9) accurately captures yield information for his customers.
Sufficient plant population to support a reasonable crop is evident at the time of emergence. In August the pods begin to form. If there is sparse plant population at emergence, farmers should report to Agricorp to obtain a reseeding benefit.
Root rot usually becomes noticeable during July and August.
Damage must be reported before the crop is harvested.

Mr. St. Pierre responded to questions. He stated that:

He did not deny the claim on the basis that there was no damage report. He brought the claim to the attention of the Regional Manager.
He accepted the undated letter from Mr. Mailloux because it was evidence from someone who had seen the crop.
He could not recall making a telephone call from his cell phone to Agricorp on January 10, 2007 during the time of his first visit to verify the low yield.
Mrs. Pauline Koszycki made a comment with respect to advising Mr. Joe Koszycki that there was something wrong with the soybean crop during the growing season.
With respect to his cell phone records for January 10, 2007 (Exhibit 8), he made the call to the ACAC at 1:32 p.m. to inquire whether Mr. Joe Koszycki had reported damage. The call was made during the meeting with Mr. Joe Koszycki and Mr. Mike Koszycki at the kitchen table January 10, 2007. No confirmation number was issued by ACAC to document the call.
Mr. Joe Koszycki could not have heard the response of the ACAC Representative confirming that he had called about low yield concerns at the beginning of harvest.
Mr. Joe Koszycki told him that he sold 2005 crop soybeans at the beginning of harvest of the 2006 crop. He could have reviewed Mr. Joe Koszycki’s yield and sales records for 2005 to verify this.
According to the Agricorp Customer Crop History Report (Exhibit 2, tab 9) Mr. Joe Koszycki’s 2006 yield is one quarter of the average total yield per acre.