Ombudsman Peter Tyndall’s office has upheld a complaint made against the Department of Agriculture’s Forest Service by a forestry contractor.

The complaint centred on forest premium payments which were made to a farmer, but which the farmer's forestry contractor said should have been made to him.

The forestry contractor had planted a forest on behalf of a farmer and had a five-year contract to maintain it. In return he was to receive the forest premium from the Forest Service. The agreement could only be revoked if both parties agreed.

However, the year after the forest had been planted, the farmer told the Forest Service that he had maintained the forest himself and that the agreement had been revoked.

The Forest Service paid the premium to the farmer.

The complainant was unaware of this until he contacted the Forest Service to seek payment of the premium. He considered that the Forest Service should honour the agreement and seek repayment from the farmer.

Examination

The contractor had a contract which could only be revoked with his agreement. The Forest Service should have sought written evidence that such agreement had been received prior to payment issuing to the farmer.

Without such evidence, the Ombudsman considered that payment should have been withheld pending receipt of confirmation of the agreed revocation.

However, he accepted that it was primarily a civil matter between both parties.

The Forest Service argued that it had paid the premium in good faith

The Forest Service argued that it had paid the premium in good faith, on the basis that the farmer had said that the contractor had been notified of the revocation and that he had maintained the forest himself.

It also said that it has since changed its procedures to require farmers to provide written evidence that contractors have agreed to the revocation of agreements before payment issues.

Outcome

While the complaint was upheld because the Forest Service had not acted correctly in managing the situation, the Ombudsman did not find that payment should have issued to the complainant.

This was because the farmer was required to certify that the maintenance work had been carried out satisfactorily and it was unlikely that would happen in this case.

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