Farm Debt Mediation: Information for Creditors
Creditor's obligations
To offer mediation to a farmer a creditor may send Form 1 Notice that mediation is available, Form 2 (to allow the farmer to respond) and additional information about the scheme, mediation and the Rural Financial Counselling service.
If a farmer requests mediation, the creditor must notify in writing (Form 3), the Department of Primary Industries (DPI) that mediation is required.
Once mediation is complete or the creditor has made reasonable attempts to offer mediation the creditor may request an exemption certificate using Form 4.
Farmer initiated mediation
A creditor may also receive a request from a farmer to participate in mediation. The creditor has 21 days to respond to the offer to mediate by sending Form 8 to the farmer.
If the parties agree to enter mediation, the creditor must notify in writing (Form 9) DPI that mediation is required.
If the creditor refuses the offer and the farmer is in default, a farmer may apply for a prohibition certificate.
There is no compulsion on either party to enter into mediation if the farmer is not in default.
Forms for mediation
To assist farmers and creditors with the process approved forms are provided
Exemption certificates
An exemption certificate may be issued by the Small Business Commissioner. Once an exemption certificate is issued a creditor may commence enforcement action in respect to the particular farm mortgage. The farmer will be advised of an application for a certificate and of the issue of a certificate. An exemption certificate remains in place for three years.
Record keeping
Both the farmer and the creditor should keep accurate records and evidence of the service of notices together with copies of all notices served on each other.
Farm Debt Mediation in New South Wales
Creditors may be familiar with the Farm Debt Mediation scheme that operates in New South Wales. The Victorian and New South Wales schemes are similar. For more information about the New South Wales scheme please refer to the Rural Assistance Authority website on http://www.raa.nsw.gov.au.
More information
For more information about farm debt mediation or to initiate mediation call the Farm Debt Mediation Officer on 136 186.
