Mr. Jim Long, Chairperson
Dr. Murray Fulton, Vice-Chairperson
Mr. Ray Riviere
Mr. Harold Greyeyes
Mr. Brian Machin, Secretary
Mr. Roy White

Mr. Brad Pavlove
Mr. Richard Gabruch, Legal Council

Mr. Harvey Brooks

Mr. Nick Langelaar
Mr. Nick Sloboshan
Mr. Van Stewart
Mr. Mitch Demyen
Mr. Conrad Mitzel

• Mr. Gabruch submitted that producers ratified the Memorandum of Understanding (MOU) in February of 2000 with the understanding that the Quota Waiting List (QWL) had been re-opened.  If the producers had known that the QWL was still closed, they may not have ratified the MOU.
• Section 6.1.c of the MOU states that “Quota units: (c) Open the auction to all expansion quota to anyone.”  Mr. Gabruch submitted that this should include all auctions, including the first one and that closing the QWL was going directly against the MOU.
• Clause 4.A.2 of the MOU states the objectives of the auction.  The first part reads:

  “The objective of the auction is:

  (a) to provide a fair, equitable and transparent method of allocating quota to new and existing producers;”[2]

  Mr. Gabruch submitted that closing the first auction to only those on the QWL as of July 6, 1999 violates this part of the MOU and that the Administrator was not acting in the best interests of the producers and Saskatchewan’s chicken industry.

• Mr. Gaburch submitted that the Administrator’s decision to close the QWL was in conflict with what the producers desire and contravened the spirit and intention of the MOU.  The CFS is a producer run organization with producers on the board of directors.  The directors would act in the best interests of the producers and do what the producers wanted.  If the producers wanted the QWL closed, the board would have left it closed.  Mr. Gabruch further submitted that the Saskatchewan chicken producers recently endorsed, with 75% approval, a petition requesting that the QWL be re-opened and that anyone be allowed to participate in the first auction.
• Mr. Gabruch submitted that by closing the QWL and limiting the participants in the first auction, a true value for quota would not be developed.  With fewer producers, it is unlikely that the true value of quota would be determined and those winning the auction would most likely receive the quota at a lower value than if there were a greater number of people involved in the auction.

• At a CFS board meeting on January 3, 2000, the CFS board unilaterally re-opened the QWL without regard to agreements made with the Agri-Food Council.
• Mr. Brooks submitted that the intent of the MOU was to have only those on the QWL at the date of signing participate in the first auction.  He further submitted that because the QWL was closed on July 6, 1999, Mr. Pavlove was not eligible for said auction.
• In the third stage of the auction process, it was agreed that, “People eligible to participate in the auction would include any potential producer who may or may not be on the quota waiting list.”  Mr. Brooks argued that this statement clearly delineates the differences between the two processes and indicates that there is a difference between those eligible to partake in the first auction and those eligible to participate in subsequent auctions.
• On June 5, 2000, Saskatchewan’s Minister of Agriculture and Food legally granted an Administrator the powers allowing him to determine the eligibility requirements for the first auction.
• Section 35(1) of the CFS regulations states that “The Board may, by order, establish policies and procedures for the conduct of auctions of quota units.”
• Section 36 of the CFS regulations states that “The Board shall, by order establish the eligibility requirements for participating in an auction mentioned in section 35.”
• Sections 35 and 36 of the CFS regulations are among those powers currently held by the administrator.
• At a board meeting of December 31, 1999 the CFS board Moved that “in accordance with the agreement between all parties on December 17, 1999 the CFS board will authorize the acting chair to sign on behalf of the CFS board, the Memorandum of Understanding that was finalized on December 30, 1999.  CARRIED.”[3]  The CFS board agreed with the MOU and signed it on behalf of all producers.
• Upon agreeing to develop an auction system for new quota, it was determined that in order to ensure a fair and equitable system, it would be reasonable to close the QWL and that those on the list at the time would be the only eligible participants for the first auction.  A letter written by Mr. Robert Wiens, a board member of the CFS in July 1999, stated that the reasons behind the decision to freeze the Quota Waiting List on July 6, 1999 “were twofold:

a.      Knowing the CFS board was considering an auction of quota to new entrants on the Quota Waiting List, the board felt it prudent to freeze the Quota Waiting List as of July 6^th, 1999 to avoid any potential conflict of interest by the board and any one who might gain knowledge of the auction.

b.     The board felt they had some accountability to the applicants on the Quota Waiting list.  The board also felt that in fairness to the applicants, no other participants should be added.”[4]