Ferme Rocaline, a non-family transfer

Ferme Rocaline Inc. a dairy farm producing 47.3kg/day, owned by Claude Rioux in Saint-Fabien, was transferred to Éric Jean, a young farmer not from the family. 

Éric had been immersed in agriculture since his childhood days when he had neighbours in addition to uncles who operated farms. He always wanted to be a farmer. Allergy problems lead him to study diesel motor mechanics. “I worked for the City of Rimouski for two years. I had job security and good conditions but I just didn’t like it.”

Making a decision, Éric searched for a farm where he could work and had some hope of taking over. Éric was aware that such a project would come with risks yet he had the solid support of his spouse.

He brought with him the experience of having worked for four producers, with eight years at Ferme des Voyer Inc. where he got into the profession of being a farmer and also learned the tasks of being a manager. During this time, he took the various steps necessary to find a farm to purchase.

Two projects were seriously analyzed. The level of debt in comparison to the sale price did not allow for a viable farming operation. At the same time, he maintained his relationship with Claude Rioux, occasionally doing the milking there.

“Claude called me to tell me that he was ready. The assessment was done, his selling price was set.” He had consulted Martin Caron, an accountant in the UPA’s Accounting and Tax Services, to compare the advantages and disadvantages of a transfer to a young person not part of the family, versus breaking the farm up into pieces. By transferring the farm to Éric, “I benefitted from an $800,000 exemption in capital gains,” Claude recounted. “I assessed my price in terms of what Éric was capable of paying.”

Éric met with Line Béland at La Financière agricole du Québec. The conclusion was positive. The project was feasible but Claude would need to accept a balance owed on the selling price. Since going to auction was not an option for Claude, he accepted!

The financing plan was developed in partnership with Martin Voisine of Desjardins. Claude and Éric agreed on a deadline of one year. Éric would be an employee and Claude would continue to be the boss. The commitments were followed through on and, at the end of one year, the roles were reversed and all the papers were signed.

Today, Claude advises Éric when needed. Although he is a very hard worker, spending time with his family is very important for Éric and so he also hired his uncle, an ex-dairy producer!