Editor’s Note: This is the second of a three-part story by Mikkel Pates, Agweek staff writer, about Sarah Vogel’s new book -- THE FARMER’S LAWYER: The North Dakota nine and the Fight to Save the Family Farm. In part I, Agweek looked at Sarah Vogel’s family heritage of fighting for farmers, and a rising farm credit crisis in the 1970s and 1980s. Now, we turn to her return to the state, a single mother in her own financial troubles, fighting for broke farmers with the U.S. Department of Agriculture’s Farmers Home Administration.
FARGO, North Dakota — In 1981, Sarah Vogel was out of her upper echelon U.S. Treasury Department job in Washington, D.C., because Ronald Reagan beat Jimmy Carter for the presidency.
Vogel moved from Virginia back to Bismarck, North Dakota. She incorrectly thought banks might hire her for "advice," much as she’d given advice to the Secretary of the Treasury. She and her son Andrew moved into a house on the Missouri River.
A financially troubled farmer-friend, Chuck Perry from North Dakota, now was traveling the country, raising funds for the “Farmers and Ranchers Protective League.” And he was promoting Vogel's legal services to farmers in trouble with the FmHA.
In her book, "The FARMER'S LAWYER," Vogel said she was “building a law practice for farmers who couldn’t afford my fees.” She was receiving child support, making only monthly minimum payments on all of her credit cards. She still owed $100,000 on the Virginia condo. Her loan was in default.
She held out hope she might get paid in these farm cases because Congress had passed the Equal Access to Justice Act. The EAJA said that if a citizen or small business sues (or is sued) by the U.S. and wins, the government should pay the winner’s legal fees.
In the “The Farmer’s Lawyer,” she describes how she accumulated a string of financially weakened clients.
Key clients were Tom and Anna Nichols — hog farmers from Wolf Point, Montana. The Nicholses had assumed his father’s FmHA loan in the 1980s. In January 1981, a blizzard killed many of Nichols’ hogs. When he couldn’t make a scheduled payment to the FmHA, Clifford Harvey, a new FmHA county supervisor, authorized the Nicholses to buy 60 bred gilts in March and sell piglets in July.
But Harvey delayed the money until May. By then, only unbred gilts were available, and Nichols couldn’t make the payment. Nichols asked for a meeting with Harvey’s boss, the district supervisor. But three weeks later, Harvey demanded the Nicholses “voluntarily liquidate” their farm. They found a banker to lend them money, but Harvey refused to sign off on the plan. Instead, he accelerated their loan and intimidated their lawyer. On Sept. 4, 1981, the Nichols represented themselves in an appeal and lost.
Finally, they called Vogel. Among other things, Vogel informed them they were entitled to apply for apply for a deferral — a provision signed into law by President Jimmy Carter, a Georgia peanut farmer who lost favor with farmers, in part, because of an embargo against selling grain to Russia because of their invasion of Afghanistan.
Big ‘farm boys’
In the book, Vogel said she lay blame for loan problems at the head of government agencies in Washington, D.C.
David Stockman, Reagan’s director of Office of Management and Budget, was a “farm boy" and former FFA member from Michigan. As farmers suffered, Sarah perceived that Stockman had a “particular animus” for farmers who borrowed money. He was quoted saying FDR-era farm programs had created “a way of life based on organized larceny.”
John Block, secretary of agriculture, (“Auction Block,” she called him) was echoed by Charles W. Schuman, national administrator of the FmHA. Schuman’s father had been president of the American Farm Bureau Federation. North Dakota FmHA director Ralph Leet, was their “willing henchman,” she wrote.
In April 1981 Leet told the Bismarck Tribune that the agency had been “too lax” in handing out money. A native of Starkweather, North Dakota, Leet was quoted in news reports saying foreclosure offered a “new start” for farmers who shouldn’t be allowed to “slide too long.”
Nationally, FmHA had started 2,395 foreclosures in 1981 and sent out 13,318 acceleration letters.
Alarmed, the Senate on Dec. 11. 1981, passed a resolution, urging the FmHA to “extend the term of defer the repayment of, or refinance the unpaid balance of” FmHA loans. But in March 1982, Schuman set a goal of reducing delinquencies by 23%. The only two ways to “reduce delinquencies” were to foreclose or “persuade” farmers to quit “voluntarily.” In the spring of 1982, there were 54 farm bankruptcies in the Dakotas and Minnesota in the first half of the year, compared to 19 in 1981. For the first time since 1954, farmland values declined.
Another client couple was Diane and Don McCabe, of Dickey, North Dakota, in LaMoure County. The McCabes had bought a 320-acre dairy in 1977, with a $154,600 emergency FmHA emergency loan. Seven cows froze that winter. They had hail in 1978, and drought in 1979 and 1980. Their debt rose to $195,422 by 1981. The FmHA director wouldn’t let them buy replacements or keep heifers to raise to milking age. With a reduced herd, they couldn’t produce enough income to make payments. The FmHA took 50% of their dairy income. They owed the other 50% to a LaMoure County bank.
The FmHA left them with nothing to live on.
In 1982, Vogel's personal finances were getting desperate. She tried to get clients to call her so the charges would go on their bills — not hers. “But all too often I was out of the office and I had no choice but to call them back,” she writes.
Vogel won Nichols’ administrative appeal. The FmHA acknowledged a “procedural irregularity” but declined Vogel's motion for $10,000 in attorney’s fees. The EAJA didn’t apply to administrative appeals, they said. She wouldn’t get paid.
On April 21, 1982, she was eight months overdue on her Virginia condo payments and served with “Warrant in Debt.” She offered a $5 payment and promised to pay when her law firm took off. As she lost other administrative appeals to FmHA, her own Virginia condo was auctioned off at a county courthouse. In May 1982 , her lender served an accelerated mortgage payment on her Bismarck house.
In 1982, Richard Woodley, a reporter for a Life magazine called about doing a story and photo essay, with iconic black-and-white photos taken by famed photographer Grey Vellet. They reporting team dubbed her “the farmer’s lawyer.”
While traveling with the Life, Vogel met with Dwight Coleman. Coleman, of Dunseith, North Dakota, farmed on the border of the Turtle Mountain Indian Reservation. Coleman borrowed $120,000, and another $100,000 for cattle and machinery, to buy a 480-acre farm in 1979. The barn burned down in 1980, killing heifers and calves. Also in 1980, 400 acres of durum wheat were buried under 2 feet of snow.
FmHA urged him to liquidate only 18 months after he bought the farm. The FmHA officials told him an appeal would be “wasting my time,” because the appeals board would be the same as the foreclosure board.
Vogel asked Coleman if he’d allow his name to be used as the lead plaintiff in a class action suit. “You betcha,” Coleman responded, adding, “The war’s on.”
Sarah remembers bringing her young son, Andrew, on the trips, and Life magazine paying expenses.
The Life crew went with her to an FmHA hearing for Ralph and Kay Clark, who lived in rural Garfield County, Montana. The Clarks had farmed 960 acres in 1978. FmHA lent them $200,000 for a down-payment on 1 7,000-acre farm. In 1982, the Clarks owed $825,000, and they shifted it into a “guest ranch” for hunters and fishermen and “dinosaur tourism.” Their 7,000-acre ranch was foreclosed and sold in 1994 and 1995.
More than a decade later, the Clarks in 1996 made national news when they renamed their farm “Justus Township” and they hosted the Montana Freemen, who espoused violent overthrow of the government, and murder and lynching of officials that didn’t allow “free man" status (no taxes, no drivers licenses, or obligation to follow federal and state laws. The Freemen believed the U.S. was a Christian republic, and Jewish and Black people were not eligible for citizenship. They were in a 91-day armed standoff with federal authorities that ended June 14, 1996. Clark spent 20 months in jail and ended up paying a $5,000 fine.
“I still wonder how it might have turned out differently had FmHA simply given Ralph and Kay Clark a fair hearing that summer day in 1982,” Vogel wrote.
Vogel said she thought she could be a “legal warrior” like the nonpartisan League lawyers that she so admired.
“But my main strength was naivete,” she said. “I was a solo practitioner proposing a lawsuit against the U.S. Government, which was represented by thousands of lawyers who fought hard and hated to lose. USDA was an ogre — big, mean and nasty. Yet I believed I could defeat it.”
Vogel found philosophical soul mates among the Center for Rural Affairs, then of Walthill, Nebraska, and Rural America, an advocacy group in Iowa. Mark Ritchie, a policy analyst at the Minnesota Department of Agriculture, told her about Curry v. Block, a Georgia lawsuit claiming USDA had failed to give borrowers deferral rights.
With clients facing similar issues, Vogel concluded she needed to file a class action lawsuit.
To finance it, she and allies sought donations by running an ad in the The Farm Forum Green Sheet. Said the advertisement: “FmHA Borrowers: Are you having trouble with the FmHA? So are we. Let’s work together. Georgia FmHA borrowers stopped foreclosures. Call us.”
The group wrote a grant proposal to the J. Roderick MacArthur Foundation, asking for $200,000 for her “Family Farm Foreclosure Legal Assistance Project." The foundation approved her for $15,000.
She had been talking with farmers about their legal matters but was not yet registered as a lawyer in North Dakota. On Aug. 5, 1982, Vogel for the first time was sworn in to the North Dakota Bar Association. She was getting ready.
NEXT WEEK, the conclusion: “Surviving to win”