In 1994, the NSW Government introduced the Farm Debt Mediation Act 1994 (NSW) (the Act). The object of the legislation is to provide for the efficient and equitable resolution of farm debt disputes. Mediation is required before a creditor can take possession of a property or other enforcement action under a farm mortgage.
The legislation was introduced to provide a circuit-breaker for farmers in what were very challenging times. In the words of the Hon Niall Blair (Minister for Primary Industries, Minister for Regional Water, and Minister for Trade and Industry) recently, the “legislation was introduced in 1994 after a tough drought, when pressure for bank accountability was mounting.New South Wales led the nation by providing this alternative dispute resolution.”1
Many in the industry, including the writer, thought the measures were temporary. Once the rains come and agribusiness turns the corner, the legislation would be repealed and life for debtors and creditors would return to “normal”. But life for a farmer never gets easier and pressures imposed by both the weather and the economy are unrelenting. And so more than 20 years since its inception, the Act is still with us.