Owed Farmers Proceeding With Puratone Court Case

crops wheat sample nov072012

Around 20 Manitoba farmers calling themselves "Disgruntled Farmers Seeking Justice" are planning to seek compensation through the courts for grain they delivered to Puratone Corporation.

The group consists of producers who delivered grain to the company's feed mills in Winkler and Arborg in the 15 days prior to Puratone going into creditor protection in September.

"Between us we're owed about a million dollars for grain which we had delivered in good faith to the Puratone Corporation. None of it has been paid for. They processed it and fed it to their own pigs," says spokesperson John Sigurdson, who farms near Riverton.

A lawyer is currently working on developing their arguments for the case, but Sigurdson says it will likely involve proving that Puratone employees encouraged producers to deliver grain while knowing they would not get paid.

He says he believes Puratone and its secured creditors intentionally chose to go into creditor protection during harvest, when farmers were looking to deliver their new crop.

"The 15 days previous to them going into creditor protection came at a time when cash-strapped farmers had plenty of freshly harvested winter wheat in the bins and were looking for a home for it. Why didn't Puratone decided to go into CCAA protection a month sooner? I would say it's because they wouldn't have been able to source any grain because there wasn't any left on farms from the previous year," says Sigurdson. "So when it came to it, Puratone offered a small premium over the market and called farmers - some of them several times - to deliver grain, fully knowing they weren't planning on paying for the inventory, because you don't just wake up one morning and go into creditor protection."

Maple Leaf Foods is in the process of buying Puratone for $42 million, which will likely not cover any of the money owed to farmers since Puratone owes $86 million to three secured creditors.

"I believe Puratone and the monitor expect us farmers just to fade away into the background, but we're definitely not just going to be just pushed back into their memories," says Sigurdson. "Something has to be done here to rectify this situation."

Share This:

Search Agricultural News Archives