'Farm Debt Mediation' is a structured negotiation process in which the mediator, as a neutral and independent person, assists the farmer and the creditor to communicate effectively, to resolve matters relating to farm debts, and to formalise that resolution in an agreement. Choosing a mediator is an important step once an invitation to mediate has been received.
Mediation is a simple, voluntary and confidential process that is quick, accessible and affordable.
The object of mediation under the Farm Debt Mediation Act 1994 is to provide for the efficient and equitable resolution of matters involving farm debts.
Mediation is required before a creditor can take possession of property or other enforcement action under a farm mortgage.
It is recommended that well before a mediation, farmers seek professional advice from a solicitor, accountant or other appropriately qualified person. Most Rural Financial Counsellors are very experienced in supporting farmers during the farm debt mediation process.
The role of the parties' advisers and supporters is to help farmers prepare well for the mediation and to consider options realistically. Advisers may help the parties and the mediator to draft the terms of any settlement reached. It is essential that advisers have a clear understanding of the mediation process and sound financial skills. Farmers are entitled to have their solicitor attend the mediation.
If you are a farmer with a complaint about your creditor, the complaint is best directed in the first instance to your creditor by phone, email or letter. The creditor ought to respond to your complaint in writing. Some creditors have a Customer Advocate to help resolve complaints effectively. If your complaint is not resolved to your satisfaction, you may wish to contact an external dispute resolution provider such as the Australian Financial Complaints Authority. Farmers’ complaints about their creditor may be a contributing factor in a farm debt dispute. An early resolution of a complaint may avoid the need for farm debt mediation. Professional advice may help to identify the most appropriate forum for resolving a matter about a farm debt.
The Farm Debt Mediation Act may also be used for succession planning and negotiating a business restructure if informal mediation has not resolved the issues.
The NSW Rural Assistance Authority administers the Farm Debt Mediation Act and will provide information about the Act on request.