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Final Agency Determination: FAD-96

FAD-96

Subject: Two requests, dated August 22, 2008 and September 22, 2008, requesting a Final Agency Determination for the 2005 crop year regarding the interpretation of the term “intact” found in section 14(a)(3) (Your Duties) of the Common Crop Insurance Policy Basic Provisions (Basic Provisions), published at 7 C.F.R. 457.8. The requests concern the term “intact” in connection with the coverage of the crop of sweet potatoes under section 11(a)(2) (Duties in The Event of Damage or Loss) of the Sweetpotato Pilot Crop Provisions (05-0085). These requests are pursuant to 7 C.F.R. part 400, subpart X.

Background

Section 14(a)(3) of the Common Crop Insurance Policy Basic Provisions states:

14. Duties in the Event of Damage, Loss, Abandonment, Destruction, or Alternative Use of Crop or Acreage.

Your Duties-

(a) In case of damage to any insured crop you must:
***

(3) If representative samples are required by the Crop Provisions, leave representative samples intact of the unharvested crop if you report damage less than 15 days before the time you begin harvest or during harvest of the damaged unit (the samples must be left intact until we inspect them or until 15 days after completion of harvest on the unit, whichever is earlier. Unless otherwise specified in the Crop Provisions or Special Provisions, the samples of the crop in each field in the unit must be 10 feet wide and extend the entire length of the row, if the crop is planted in rows, or if the crop is not planted in rows, the longest dimension of the field. The period to retain representative samples may be extended if it is necessary to accurately determine the loss. You will be notified in writing of any such extension); and . . .

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Section 11(a)(2) of the Sweetpotato Pilot Crop Provisions states:

11. Duties in the Event of Damage or Loss.

Your Duties-

(a) Your duties (in addition to those stated in the Basic Provisions):

***

(2) In accordance with the requirements of section 14 of the Basic Provisions, you must leave representative samples of unharvested production in all harvested fields in the manner that we direct. We will tell you the number of representative samples and their location when we receive your notice of loss. You may not harvest or destroy the representative samples until we have inspected the field. We will appraise an amount of production that is at least equal to the production guarantee if you do not leave the representative samples before our appraisal.

Interpretations Submitted

August 22, 2008 Interpretation - The above policy provisions instruct an insured to leave the required representative samples “intact.” The requestor interprets that in order to comply with the terms of the policy, as it pertains to the crop of sweet potatoes, the insured must not take any action which would not leave the samples complete and in their original state. (The insured must provide sufficient care to “protect the crop from further damage.” Basic Provisions section 14(a)(1) (Your Duties.)

The requestor’s interpretation of the term “intact” is supported by reference to well-respected dictionaries. The Cambridge Advanced Learner’s Dictionary defines “intact” as “complete and in the original state.” Similarly, Merriam-Webster’s Online Dictionary defines “intact” as “untouched especially by anything that harms or diminishes.”

September 22, 2008 Interpretation - “We request an interpretation that the term “intact” is not a scientific term, nor is it a term of art, and that the term “intact” means exactly that-intact. A further interpretation of the term is unnecessary and would necessarily require a consideration of particular factual situations. FCIC is not allowed to “interpret any specific factual situation or case, such as actions of any participant under the terms of the policy.” (7 C.F.R. § 400.768).”

Final Agency Determination

FCIC agrees that since the term “intact” is not defined, it must be given its common meaning. FCIC agrees that a term’s common meaning is derived from the dictionary. FCIC agrees that “intact” means in its “complete and in their original state” and “untouched especially by anything that harms or diminishes.”

Even though 7 C.F.R. part 400, subpart X is only applicable to provisions of the Federal Crop Insurance Act and the regulations promulgated there under, and the sweet potato policy has not yet been codified in the Code of Federal Regulations, to the extent those provisions are identical or nearly identical, this Final Agency Determination applies accordingly to assure consistent, uniform, and equitable treatment to all producers insured under the same policy provisions.

In accordance with 7 C.F.R. 400.765(c), this Final Agency Determination is binding on all participants in the Federal crop insurance program for the 2005 crop year. Any appeal of this decision must be in accordance with 7 C.F.R. 400.768(g).

Date of Issue: November 20, 2008