Auction mart boss in court to claim £100,000 of FMD funds
Last updated 08:46, Friday, 04 July 2008
A Cumbrian auction mart is embroiled in a court battle with the Government over fees it says it has been owed since the 2001 foot and mouth crisis.
Cockermouth-based Mitchells is thought to be the only company in the country not to have agreed a settlement over the dispute. It is suing the Department for the Environment, Food and Rural Affairs (Defra) for £119,000.
The case centres around the fees paid to the auction mart for its valuations of inspected and condemned sheep flocks.
Defra – then called Maff – claimed it imposed a cap of £1,500 per valuer per day, when it agreed rates with the Central Association of Agricultural Valuers (CAAV).
Mitchells, whose staff often couldn’t return to their own farms because they were valuing infected stock, claims it was a per valuation agreement and that there was no daily cap.
Senior Defra economist David Rabey was involved in the negotiations. He told Manchester High Court yesterday: “In hindsight, I wish we had put a statement out on the website about the fees.
“There was clearly a level of misunderstanding, but I do not agree there was a systematic or wholesale failure.”
Cumbrian valuers started work without knowing how much they would get paid in many cases, unaware of the CAAV agreement.
Mitchells director Adam Day told the court on Monday that it had been impossible to get confirmation on the rates from the department at the height of the crisis.
He said: “As a valuer, with foot and mouth raging through the country, my only thoughts were to get the job done – I did not think about the rate at the time. I don’t think being commercial was our primary concern.”
Jeremy Moody, secretary of the CAAV, said in a statement that the fees were unclear from the start and there had been inconsistency in payments. He said: “There seemed to be uncertainty within Defra itself, with some valuers being paid £1,500 per day, per valuation and others being paid on the basis of an overall cap of £1,500 per day, irrespective of the number of valuations.
Mitchells conducted more than 400 valuations during the crisis and was paid a total of £231,000 for the work.
Richard Morris, managing director of PFK, which used to own the Penrith Mart, also took the stand.
He tried to clarify the fees and negotiate a better deal for valuers during the crisis.
He said in a court statement “Valuers were working flat out and well into the evening every day and, on the per day basis, would have reached the £1,500 cap at an early stage.
“There would have been no incentive for valuers to carry on working once the daily cap had been reached.
“There could have been a huge backlog of valuations, which would have impaired the cull process and the eradication of foot and mouth.”
Valuations were essential before flocks were culled so the Government knew how much compensation to pay farmers.
Helena Mitchellhill, from Mitchells, said she had a telephone conversation with Defra that seemed to confirm a per valuation agreement in March 2001. She said it was several weeks before a per day cap was mentioned.
Livestock marts in Wigton and Ulverston have given evidence in support of Mitchells’ case.
Bruce Walton, from Hopes in Wigton, said in a statement: “We worked morning, noon and night in the most appalling conditions, dealing with farmers in a state of shock and distress.”
He said valuers should have been paid a premium.
Witnesses for Defra, including Carlisle Animal Health chief, John Kelsey, were due to continue giving evidence yesterday and today. The case is due to conclude on Monday.
