Mediation Services for the Farm Debt Mediation Service (FDMS) in the province of Manitoba

1.2 Summary 1.2.1 The Farm Debt Mediation Act (FDMA) received Royal Assent on April 25, 1997 and came into force on April 1,1998. The Farm Debt Mediation Service (FDMS) was established to deliver the FDMA. The service provides a streamlined process of mediation to assist insolvent farmers and their creditors to negotiate settlement arrangements, rather than have those disputes result in costly legal proceedings for all parties. A Mediator is assigned to assist the farmer and creditors explore options for the successful resolution of the case. To apply for assistance under the FDMA, an individual, corporation, partnership, cooperative or other association of persons must be "engaged in farming for commercial purposes", meaning that the production from their crops, livestock, or other eligible commodities is commercially available for sale as opposed to being grown for the personal use of the farmer or for a person related to the farmer as defined in the regulations. The applicant must also be "insolvent”, which is defined in article 6 of the FDMA as follows: Page 4 of - de 38 Only farmers: • who are for any reason unable to meet their obligations as they generally become due; • who have ceased paying their current obligations in the ordinary course of business as they generally become due; or • the aggregate of whose property is not, at a fair valuation, sufficient, or if disposed of at a fairly conducted sale under legal process would not be sufficient, to enable payment of all their obligations, due and accruing due. Under the FDMA, farmers can apply for review and mediation only or for a Stay of Proceedings, review and mediation. There are several factors to consider in deciding how to apply. Secured creditors are obliged by the Act to serve the farmer with a Notice of Intent to Realize on Security before undertaking any action to recover debts. In this case, the farmer would usually choose the FDMS application which includes a Stay of Proceedings to prevent further action by the creditor during mediation. The farmer would also apply for a Stay when being sued for a debt by an unsecured creditor. Though unsecured creditors are not required to provide a Notice of Intent, the Stay still protects the farmer's assets during mediation. If a Notice of Intent has not been served and legal action has not been taken, the farmer may prefer to apply for review and mediation only, without applying for a Stay. Once the review and recovery plan are prepared an unbiased mediator is appointed by the Manager to meet with the farmer and their creditors to try and facilitate a comprehensive solution between the parties. Mediators must be free from any conflict of interest in the matters between the farmer and creditors and are expressly forbidden under the FDMA from providing advice to either the farmer or any of the creditors. During the mediation the farmer presents the recovery plan to the creditors and seeks their agreement to a course of action to resolve the current financial difficulties. If the farmer has applied with a Stay, the meeting would involve all creditors. If without a Stay, then the meeting would involve all secured creditors and any other creditors who need to be involved in reaching a settlement. There may be cases where a recovery plan would not be required, such as those situations where the farmer wants to negotiate an agreement for an orderly sale of assets and an exit from farming. At the conclusion of the negotiation it is critical for the parties to obtain either a signed, binding agreement or an agreement-in-principle with a well-defined plan of action for having a final agreement drawn up and signed. An assessment will be conducted by the FDMS office after completion of the mediation. The assessment will evaluate the participants' satisfaction with the FDMS office, and the mediation services and help to determine possible program changes or enhancements that may be initiated. You can find more information about the FDMS on AAFC web site: https://agriculture.canada.ca/en/programs/farm-debt-mediation-service 1.2.2 One method of supply used by Agriculture and Agri-Food Canada (AAFC) to satisfy the requirements of our programs is to invite suppliers (by way of a Request for Standing Offer (RFSO) to submit an offer for the provision of services during a specified period. With the completed RFSO process, AAFC is authorized to make call-ups against the resulting SO’s detailing the exact level of services they wish to order at a particular time during the effective period of the SO, in accordance with the predetermined conditions. A RFSO does not commit AAFC to authorize the utilization of an SO or to obtain services or issue a subsequent Contract to this effect. A standing offer is not a contract and that the issuance of an SO and Call-up Authority does not oblige or commit Canada to procure or contract for any services listed in the SO. The Offeror understands and agrees that Canada has the right to procure the services specified in the SO by means of any other contract, SO or contracting method. Page 5 of - de 38 1.2.3 The purpose of this Request for Standing Offers (RFSO) is to select Offerors to enter into negotiations with AAFC to issue Departmental Individual Standing Offers (SO) to obtain the services described in the Statement of Work for Manitoba. The total budget for the SO will be approximately $510,000.00 based on a maximum of four (4) standing offers. Services are required for a period of four (4) years, starting at date of issuance of standing offers.