New South Wales Consolidated Acts

FARM DEBT MEDIATION ACT 1994 - SECT 11

11 Certificate that Act does not apply to farm mortgage

(1) The Authority must, on the application of a creditor under a farm mortgage, issue a certificate that this Act does not apply to the farm mortgage if:

(a) the farmer is in default under the farm mortgage, and

(b) no exemption certificate is in force in relation to the farm mortgage, and

(c) the Authority is satisfied that:

(i) satisfactory mediation has taken place in respect of the farm debt involved, or

(ii) the farmer has declined to mediate, or

(iii) 3 months have elapsed after a notice was given by the creditor under section 8 and the creditor has throughout that period attempted to mediate in good faith (whether or not a mediation session or satisfactory mediation took place during that period).

(1A) If the creditor has (in whatever terms employed) agreed in writing to extend the period that will be available to the farmer for the conclusion of mediation between the parties to beyond 3 months, the reference in subsection (1) (c) (iii) to a period of 3 months is taken to be a reference to the extended period.

(1B) A failure by a creditor to agree to reduce or forgive any debt does not, of itself, demonstrate a lack of good faith on the part of a creditor in attempting to mediate.

Note: Satisfactory mediation may nevertheless have taken place between the farmer and the creditor despite such failure to agree (see section 4 (1A)).

(2) A farmer is presumed to have declined to mediate if any of the following circumstances is established:

(a) the farmer has failed to take part in mediation in good faith or has unreasonably delayed entering into or proceeding with mediation,

(b) the farmer has indicated in writing to the Authority or to the creditor that the farmer does not wish to enter into or proceed with mediation in respect of the debt concerned,

(c) the farmer has failed to respond in writing, within 28 days, to an invitation that:

(i) is made in writing by the creditor and is identified as an invitation under this paragraph, and

(ii) invites the farmer to attend a mediation session, and

(iii) indicates that a failure of the farmer to respond in writing to the invitation might be taken to be an indication that the farmer declines to mediate in respect of the farm debt.

(4) A certificate may be given under this section (except where subsection (1) (c) (iii) applies) whether or not any notice has been given under section 8.

(5) A certificate under this section remains in force until the date specified by the Authority in the certificate. The date specified is to be calculated on the basis that the period for which the certificate is to be in force is:

(a) if satisfactory mediation in respect of the farm debt concerned has taken place, the period commencing on the date of its issue and ending on the third anniversary of the last date of the mediation, or

(b) if the farmer has failed to take part in mediation in good faith, the period commencing on the date of its issue and ending on the third anniversary of the last date of the mediation, or

(c) if the farmer has indicated in writing that the farmer does not wish to enter into or proceed with mediation, the period commencing on the date of its issue and ending on the third anniversary of the date the indication was given to the Authority or creditor, or

(d) if the farmer has failed to respond in writing, within 28 days, to an invitation referred to in subsection (2) (c), the period commencing on the date of its issue and ending on the third anniversary of the date that is 28 days after the invitation was given to the farmer, or

(e) if a notice was given by the creditor under section 8, the period commencing on the date of its issue and ending on the date that is 3 years and 3 months after the date the notice was given, or

(f) in any other case in which a certificate is issued, the period of 3 years commencing on the date the certificate was issued.

(5A) A certificate may not be issued after the date on which any such certificate would, if issued, expire under subsection (5).

(6) The expiry of a certificate under this section does not affect any proceedings for recovery of a farm debt, or for the exercise or enforcement of any right of the creditor, already taken or commenced by a creditor while the certificate was in force, and any such proceedings may be continued and concluded as if the certificate were still in force.

(7) The reference in subsection (6) to the commencement of proceedings does not include a reference to the giving of any statutory enforcement notice or other action taken in order to fulfil a condition precedent to the enforcement of a right otherwise than through proceedings in a court or tribunal.