Uncertainty has emerged regarding the farm group's crop insurance coverage after Saskatchewan Crop Insurance Corporation (SCIC) sought repayment of an alleged overpayment.
Monette Farms has cleared an important milestone in its creditor protection proceedings, with a court approving the first sale of property as the company continues efforts to reduce debt and restructure its operations. At the same time, new uncertainty has emerged regarding the farm group's crop insurance coverage after Saskatchewan Crop Insurance Corporation (SCIC) sought repayment of an alleged overpayment.
According to a recent affidavit filed by chief executive officer Darrel Monette as part of the Companies' Creditors Arrangement Act (CCAA) process, SCIC determined that Monette Farms received excess payments during the 2023-24 crop year. The insurer reportedly requested repayment of approximately $1.9 million by Aug. 15, indicating that continued insurance coverage could depend on resolving the matter.
Earlier court filings had stated that insurance for the 2026 crop year was already in place. However, Monette Farms and the court-appointed monitor, FTI Consulting, are now reviewing whether the disputed amount should be treated as a debt that existed before the CCAA filing and whether SCIC has the authority to alter or cancel coverage because of the outstanding balance.
The farming enterprise entered creditor protection in April after defaulting on payments tied to a loan package valued at roughly $930 million and led by the Bank of Nova Scotia. The company operates extensive grain, livestock, and produce businesses across Canada and the United States.
As of Aug. 25, no additional court filings had confirmed whether the insurance dispute had been settled or whether any repayment had been made. The affidavit also noted that crop insurance premiums are generally paid after harvest, meaning developments later in the growing season could affect the significance of the issue.
Meanwhile, progress is being made on the sale of Monette Farms assets. A judge of the Alberta Court of King's Bench approved the first transaction on Aug. 19. The approved buyer, Nevada-based Byner Cattle Co., agreed to purchase approximately 3,100 acres near Aguila, Arizona, along with associated infrastructure that includes a seed-processing facility and cold-storage operation.
Financial details of the transaction were not disclosed by the court. The properties involved had previously been advertised for sale at listing prices of approximately $18.5 million and $5 million. Court documents indicated that although brokers reached out to 17 potential purchasers, only one formal offer was submitted, ultimately leading to the approved transaction.
The sale also includes the transfer of state land leases that account for a significant portion of the acreage. Before the transaction can be completed, approval must also be secured from a U.S. bankruptcy court.
Monette Farms continues to market most of its land holdings through a sale and investment process launched in late June. With the exception of a limited amount of Alberta farmland, nearly all company-owned land in both Canada and the United States has been placed on the market.
In British Columbia, the divestment program has moved more slowly. Marketing efforts were delayed until a brokerage firm was selected near the end of July. LandQuest Realty Corp. was subsequently appointed to sell 11 ranch properties totaling roughly 45,000 acres. Previous attempts by Monette Farms to sell those ranch assets had not resulted in completed transactions.