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The Rural Voice, 1991-02, Page 18can•con MUM A A COW MATS Consider the facts .. . / J • Comfort • Cleanliness / 1 • Cost • Durability • Safety Rubber Cow Mats 4' x 6' x 314' Call Now! Save Bedding - quantity discounts Also Available - Moo Shoes - Water Bowls - Cow Trainers - Feed Carts - Hay Feeders - Cattle Oilers - PEL Electric Fencers See us at the Canadian Int. Farm Equipment Show — Hall 4A, Booth 1403, Feb. 5-8/91, Toronto & The Perth County Farm Show, Feb. 19 - 21/91, Stratford A division of Steve's Welding R. R. 1, Newton, Ont. NOK 1R0 519.595.8737 40e� SHOW 1991 Come visit us 111 INCOME TAX AND FARM MANAGEMENT SERVICE Income Tax • farm, business, or personal • complete year round service including tax audit representation Farm Management • arranging leases to qualify for tax rebates • Farm Start and other forms prepared • farm debt review assistance Over 10 years experience Quality work at reasonable rates "FREE CONSULTATION" Stephen Thompson Box 387, Blyth 523-4916 14 THE RURAL VOICE MAKING THE MOST OF FARM DEBT REVIEW The bank has just sent you a letter demanding payment of monies it claims you owe to it. The letter states that if you do not pay within twenty-one (21) days the bank will take you to court. There is no way you can raise that kind of money, let alone pay it, in 21 days. What should you do, other than contact legal counsel? Obviously, immediately, make application for Farm Debt Review and obtain a stay of proceedings which will prohibit the bank from doing anything against you for potentially as long as 120 days. WRONG! In 1986, in response to financial difficulties being experienced by far- mers due to poor economic times, the federal government passed the Farm Debt Review Act. The Act provides for the establishment of the Farm Debt Review Board (FDRB). The purpose of the board is to assist farmers in fin- ancial difficulty by reviewing their financial affairs and providing assis- tance in arranging with creditors for the orderly payment of debts. Any farmer who is in financial difficulty or is insolvent can make application to FDR for his or her sit- uation. In the event that the board, based on the application, concludes that the farmer is insolvent, then an automatic stay of proceedings between 30 and 120 days immediately issues prohibiting the creditor from taking any steps against the farmer. The Act also says application can only be made for FDR once every two years and hence, there can only be one stay of proceedings within a two year period. All too often, farmers in financial difficulty and in a dispute with the bank, make application for FDR at too early a stage. The initial reaction, when first pressured by the bank, is to immediately make application so as to prevent the bank from being allowed to do anything for 120 days. And this is what the bank is hoping you'll do! FDR can provide an important practical and tactical advantage to the farmer in a court battle with the bank if used at the appropriate time. If a farmer in distress immediately applies for FDR at the outset of the dispute with the bank, he or she may well be using the best soldier available at a time when the battle lines are merely being drawn, not when the battle is actually being fought. When the actual battle is being waged, this soldier is not available when he could have been the most useful because application has already been made for FDR, the stay has expired, and review is no longer available until two years from the date of the initial application. This is exactly why, at the com- mencement of a dispute, the bank encourages the distressed farmer to apply for FDR; the earlier application is made, the less difficulty it will cause to the bank in proceeding against you. The earlier application is made, the sooner the 120 day stay will expire, thus allowing the bank to pro- ceed without the threat of FDR in the future at a crucial stage in the law suit. In effect, FDR is the farmer's trump card against the bank. If played at the right time, it can greatly in- crease your chances of success in a dispute with the bank; if played too early, it can become a wasted card. Don't waste it!0 Agrilaw is a syndicated column produced by Cohen, Melnitzer, a full service London law firm. W. Paul Linley, an associate in the firm, practises in the area of commercial litigation, including disputes with banks. Agrilaw is intended to provide information to farmers on subjects of interest and importance. The opinions expressed are not intended as legal advice. Before acting on any information contained in Agrilaw, readers should obtain legal advice with respect to their own particular circumstances.