Recent Jury Verdicts Confirm Your Liability Insurance Likely Not Enough to Save Your Farm

If there is one thing I wish I could get clients to understand is the fact that even if your farm has liability insurance, you are likely under insured with your current liability coverage. Essentially, if you have a million dollars of coverage, or several million, the coverage is peanuts now days.How big a bag of peanuts? Well, here in Indiana we recently had a whopping 35 million dollar verdict against a defendant for causing an accident that left the plaintiff a quadriplegic.Similar verdicts have been handed down across the country as of late. As one attorney stated “jurors are increasingly less offended by requests for million-dollar-plus verdicts”Whoa.Wasn’t it not too long ago society was up in arms about a woman in Texas getting several million for being burned by hot coffee?It sure was.But, as another attorney stated, “the shock of big money verdicts has been muted by seemingly daily news about lottery jackpots, athlete contracts and CEO compensation”.Thus, it seems plausible t…

This week I am told there are 50,000+ FFA members in Indianapolis for their yearly convention.I find it fitting to write this article about younger farmers who are the next generation and what happens when the older generation fails to put together a farm transition plan.Without a transition plan, I believe there is a 90% chance the next generation goes to the NFL, which stands for Not Farming Long.(yes, I coined this and take credit for it)Before I discuss this further, let’s look at a few things. 1.First, no one ever keeps score in farming.What I mean is that when a son or daughter returns to the farm, no one keeps track of their hours, their input, their monetary contribution, or so forth.As the years go by, no one is able to remember what all the young farmer contributed to the operation, especially the nonfarm siblings. Then, at distribution time, the dreaded “fair is equal” mentality of the older generation kicks in becaus…

This fall we have snow on crops in North Dakota, wet in the mid west, a hurricane down south, flooding along the eastern seaboard....all this will keep crop adjusters busy.  Perhaps too busy, in that it may be difficult for farmers to get adjusters on scene in a timely manner. 
This means farmers may be back trying to harvest what they can before an adjuster can get there.  In these circumstances, it could be critical you leave an adequate "representative sample" of the crop, depending on the circumstances.  Essentially, a representative sample is an amount of the crop left in the field that adequately represents what the condition of the field was as a whole.   It allows the crop insurance company to derive a yield for the entire field based off of strips left by the farmer.
What the heck is that, you may ask?  Good question.   The exact definition is contained in the crop insurance handbooks and/or …

Avoiding a Denial of Crop Insurance Claims

Crop insurance plays an ever increasing role in modern farming.  However, like any safety net, crop insurance can be wrought with holes.Over the years I’ve seen producers have their claims denied for many different reasons.Often times these reasons are really no fault of the producer.Simply stated, the federal crop insurance rules are very complex and can be unforgiving. Generally, when a producer believes they have a claim, they call up their agent.The agent then submits a claim and at some point an adjuster is assigned to the case.The adjuster comes out to the farm and evaluates the crop, measures bins, and so forth.Although the adjuster should be well versed in the procedures, sometimes such is not the case.We had a case a few years ago where the producer had frost kill the corn before it reached maturity.The producer wanted to have the corn salvaged for silage.The adjuster informed the producer that strips would have to be left in the field for further analysis.So, …

From time to time, non-farm friends of mine will invite me to a casino.Casinos really are not my cup of tea, and I remind them that my gambling each year is putting seed in the planter, and I have far more money at stake than I could ever take to the casino. If you think about it, we as farmers each year have, just to name a few, the following risks:weather, weeds, prices, plant disease, etc.These are referred to as “production risks” and, simply stated, each year we take on these risks that we accept are just part of farming.As to these risks, farming as a sole proprietor, S-corp, C-corp, or other entity, has no bearing on these risks. Now, let’s consider other risks that are what I would call “operational” risks.These risks exist as part of a secondary layer of risk.For example, injury or death to an employee, accidents occurring on roads that cause injury or death, chemical/fertilizer spills or drift, on farm accidents to third part…

Schwarz completes training through the International Farm Transition Network

John is the only attorney in Indiana and Michigan that has been trained though the International Farm Transition Network (IFTN).   The IFTN is a network of service providers from different professional backgrounds, such as accountants, lawyers, farm managers, ag lenders, etc, working to assist farm businesses with their successful transition to an identified successor. 

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Chapter 12 Bankruptcy: Family Farm Restructuring

The following is from the Arkansas University School of Law
By  · May 15, 2015 · 2015 Ark. L. Notes 1686 
In categories: Administrative LawAgricultural LawAlternative Dispute ResolutionBankruptcyBusiness LawDebtor/CreditorFinancial Institutions LawThis overview of Chapter 12 Bankruptcy is written to provide an introduction to the basic Chapter 12 process, highlighting some of the issues that distinguish it from other types of bankruptcy and explaining how it may be useful to family farmers and family fisherman who are experiencing financial distress. There are many complex issues that extend far beyond the scope of this short overview. For more information, attorneys should consult the Bankruptcy Code and Rules as well as the relevant case law from your jurisdiction. I. Historical PerspectivesChapter 12 was added to the Bankruptcy Code in 1986 during a deep financial crisis in the farm economy. It was designed to provide a special type of restructuring opport…