Text: HF00398                           Text: HF00400
Text: HF00300 - HF00399                 Text: HF Index
Bills and Amendments: General Index     Bill History: General Index



House File 399

Partial Bill History

Bill Text

PAG LIN
  1  1                           DIVISION I
  1  2    Section 1.  Section 554.9307, subsection 1, Code 1999, is
  1  3 amended to read as follows:
  1  4    1.  Except as provided in subsection 4, a A buyer in the
  1  5 ordinary course of business as defined in section 554.1201,
  1  6 subsection 9, takes free of a security interest created by
  1  7 that person's seller even though the security interest is
  1  8 perfected and even though the buyer knows of its existence.
  1  9 However, this section does not apply to buyers of farm
  1 10 products as provided in section 554.9307A.  For purposes of
  1 11 this section, a buyer or buyer in the ordinary course of
  1 12 business includes any commission merchant, selling agent, or
  1 13 other person engaged in the business of receiving livestock as
  1 14 defined in section 189A.2 on commission for or on behalf of
  1 15 another.
  1 16    Sec. 2.  Section 554.9307, subsections 4 through 6, Code
  1 17 1999, are amended by striking the subsections.
  1 18    Sec. 3.  NEW SECTION.  554.9307A  FARM PRODUCTS.
  1 19    1.  As used in this section, unless the context otherwise
  1 20 requires:
  1 21    a.  "Buyer" means a person who, in the ordinary course of
  1 22 business, buys farm products from a person engaged in farming
  1 23 operations who is in the business of selling farm products.  A
  1 24 buyer includes a commission merchant and selling agent as
  1 25 defined in this section.
  1 26    b.  "Central filing system" means a system for filing
  1 27 effective financing statements or notice of such financing
  1 28 statements as provided in subsection 2.
  1 29    c.  "Commission merchant" means a person engaged in the
  1 30 business of receiving any farm product for sale, on
  1 31 commission, or for or on behalf of another person.
  1 32    d.  "Crop year" means the calendar year in which a crop is
  1 33 or will be harvested, animals are born or acquired, or poultry
  1 34 or eggs are or will be sold.
  1 35    e.  "Debtor" means a person who owns a farm product and
  2  1 subjects it to a security interest, whether or not that person
  2  2 owes a debt to the secured party.
  2  3    f.  "Effective financing statement" means a financing
  2  4 statement required to be filed as part of the central filing
  2  5 system as provided in subsection 2.
  2  6    g.  "Farm product" means an agricultural commodity such as
  2  7 wheat, corn, soybeans, or a species of livestock such as
  2  8 cattle, hogs, sheep, horses, or poultry used or produced in
  2  9 farming operations.  "Farm product" also means a product of
  2 10 such crop or livestock in its unmanufactured state that is in
  2 11 the possession of a person engaged in farming operations.  The
  2 12 secretary, by rule, shall create a list of farm products which
  2 13 may include the list of farm products set forth in 9 C.F.R. }
  2 14 205.206.
  2 15    h. "Knows" means having actual knowledge.  "Knowledge"
  2 16 means actual knowledge.
  2 17    i.  "Secretary" means the secretary of state.
  2 18    j.  "Security interest" means an interest in a farm product
  2 19 that secures payment or performance of an obligation.
  2 20    k.  "Selling agent" means a person, other than a commission
  2 21 merchant, who is engaged in the business of negotiating the
  2 22 sale and purchase of a farm product on behalf of a person
  2 23 engaged in farming operations.
  2 24    2.  The secretary of state shall establish and administer a
  2 25 central filing system for filing effective financing
  2 26 statements or notices of effective financing statements on a
  2 27 statewide basis which complies with the requirements set forth
  2 28 in 7 U.S.C. } 1631 and which has been certified by the United
  2 29 States secretary of agriculture prior to implementation.
  2 30    a.  The secretary of state shall provide for filing
  2 31 effective financing statements, and statements amending,
  2 32 continuing, or terminating effective financing statements, as
  2 33 provided in this paragraph.  The secretary shall prescribe all
  2 34 forms to be used for a filing, and shall establish filing fees
  2 35 by rule.  Presentation for filing of a statement and the
  3  1 acceptance of the statement by the secretary constitutes
  3  2 filing under this subsection.
  3  3    (1)  An effective financing statement shall be valid if it
  3  4 substantially complies with the requirements of paragraph "a"
  3  5 even though it contains minor errors that are not seriously
  3  6 misleading.  An effective financing statement shall comply
  3  7 with all of the following:
  3  8    (a)  The statement must be an original or reproduced copy
  3  9 which is signed by the secured party and debtor.  The
  3 10 statement must be filed with the secretary by the secured
  3 11 party.  The secretary shall record the date and hour of the
  3 12 filing of the effective financing statement.  The statement
  3 13 must contain information that the secretary requires to comply
  3 14 with 7 U.S.C. } 1631 or to administer this section.
  3 15    (b)  The statement must contain all of the following:
  3 16    (i)  The name and address of the secured party.
  3 17    (ii)  The name and address of the debtor.
  3 18    (iii)  The social security number of the debtor or, in the
  3 19 case of a debtor doing business other than as an individual,
  3 20 the internal revenue service taxpayer identification number of
  3 21 the debtor.
  3 22    (iv)  A description of the farm products subject to the
  3 23 security interest, the county in Iowa where the farm products
  3 24 are produced or will be produced, the crop year unless every
  3 25 crop of the farm product in question for the duration of the
  3 26 effective financing statement is to be subject to the
  3 27 particular security interest, further details of the farm
  3 28 product subject to the security interest if needed to
  3 29 distinguish it from other quantities of the farm product owned
  3 30 by the same person or persons but not subject to the
  3 31 particular security interest, and other information that the
  3 32 secretary requires to administer this section.  The effective
  3 33 financing statement may cover more than one farm product
  3 34 located in more than one county.
  3 35    (2)  The following shall apply to an effective financing
  4  1 statement:
  4  2    (a)  The statement shall remain effective for a period of
  4  3 five years from the date of filing, subject to extensions for
  4  4 additional periods of five years each by filing or refiling a
  4  5 continuation statement within six months before the expiration
  4  6 of the five-year period.  A continuation statement shall be
  4  7 signed by the secured party and the debtor, identify the
  4  8 original effective financing statement by file number, and
  4  9 state that the original financing statement is still
  4 10 effective.  Upon timely filing of a continuation statement,
  4 11 the effectiveness of the original financing statement shall be
  4 12 continued for five years after the last date to which the
  4 13 filing was effective, whereupon it shall lapse unless another
  4 14 continuation statement is filed prior to the lapse.
  4 15 Succeeding continuation statements may be filed in the same
  4 16 manner to continue the effectiveness of the original effective
  4 17 financing statement.
  4 18    (b)  The statement shall be amended in writing to reflect a
  4 19 material change, within three months of the change.  The
  4 20 amendment shall be signed and filed as required for an
  4 21 original effective financing statement.
  4 22    (c)  The statement lapses upon the expiration of the
  4 23 effective period of the effective financing statement or
  4 24 terminates upon the filing of a notice signed by the secured
  4 25 party that the statement is terminated.  If the effective
  4 26 financing statement has not lapsed or terminated and there is
  4 27 no outstanding secured obligation and no commitment to make
  4 28 advances, incur obligations, or otherwise give value, the
  4 29 debtor may notify the secured party in writing to terminate
  4 30 the effective financing statement.  Until the debtor instructs
  4 31 the secured party in writing to terminate the effective
  4 32 financing statement, the secured party has no obligation to
  4 33 terminate the effective financing statement.  Within thirty
  4 34 days after receipt by the secured party of the notice from the
  4 35 debtor to terminate the effective financing statement, the
  5  1 secured party shall file with the secretary a termination
  5  2 statement with respect to the effective financing statement.
  5  3    b.  The secretary shall compile the effective financing
  5  4 statements into a master list subject to all of the following:
  5  5    (1)  The master list shall be organized according to farm
  5  6 products.  The master list shall contain information required
  5  7 to be contained in effective financing statements filed with
  5  8 the secretary.  The secretary shall arrange the master list
  5  9 for each farm product as follows:
  5 10    (a)  In alphabetical order according to the last name of
  5 11 the individual debtors or, in the case of debtors doing
  5 12 business other than as individuals, the first word in the name
  5 13 of such debtors.
  5 14    (b)  In numerical order according to the social security
  5 15 numbers of the individual debtors or, in the case of debtors
  5 16 doing business other than as individuals, the internal revenue
  5 17 service taxpayer identification numbers of the debtors.
  5 18    (c)  Geographically by county.
  5 19    (d)  By crop year.
  5 20    (2)  The master list shall include information regarding
  5 21 buyers who register with the secretary on forms prescribed by
  5 22 the secretary as provided in subparagraph (3).
  5 23    (3)  The secretary shall maintain a list of all buyers of
  5 24 farm products who register with the secretary.  A buyer
  5 25 registering with the secretary shall pay a registration fee
  5 26 set by the secretary and complete forms requiring all of the
  5 27 following information, as prescribed by the secretary:
  5 28    (a)  The name and address of the buyer.
  5 29    (b)  The interest of the buyer in receiving the lists
  5 30 described in this paragraph.
  5 31    (c)  The farm products in which the buyer has an interest.
  5 32    (4)  The secretary shall distribute to each registered
  5 33 buyer a copy in written or printed form of those portions of
  5 34 the master list relating to farm products in which the buyer
  5 35 has registered an interest.  The secretary may provide for the
  6  1 distribution of the master list or portions of the list on any
  6  2 other medium requested by a registered buyer.  If a registered
  6  3 buyer so requests, the information provided to the buyer may
  6  4 be limited to a county or group of counties where the farm
  6  5 product is produced or to a crop year or crop years or to a
  6  6 combination of these identifiers.  The secretary shall charge
  6  7 a buyer an annual fee to cover costs of distributing the
  6  8 lists.  Distribution is subject to all of the following:
  6  9    (a)  The distribution shall be by regular mail.
  6 10    (b)  The secretary shall, by rule, establish the dates upon
  6 11 which the monthly distributions will be made, the dates after
  6 12 which a filing of an effective financing statement will not be
  6 13 reflected on the next monthly distribution of lists, and the
  6 14 dates by which a buyer must complete a registration to receive
  6 15 the next monthly list.
  6 16    (c)  The secretary shall remove information pertaining to
  6 17 lapsed and terminated effective financing statements or
  6 18 notices of such financing statements from the master list
  6 19 prior to preparation of the lists required to be distributed.
  6 20    (d)  Upon written notice to the secretary by a registered
  6 21 buyer, the secretary shall terminate distribution of the list
  6 22 to the registered buyer.
  6 23    Oral and written inquiries by a buyer not registered
  6 24 pursuant to subparagraph (3) may be made to the secretary
  6 25 during hours determined by the secretary.  An oral response to
  6 26 inquiries shall be available to an inquiring nonregistered
  6 27 buyer not later than on the regular business day following the
  6 28 day on which the inquiry was received, at or before the time
  6 29 of day when it was received.  Written confirmation of the
  6 30 information provided orally in response to the inquiry shall
  6 31 be mailed by first class mail to the nonregistered buyer, at
  6 32 an address provided by the buyer, by the secretary not later
  6 33 than the second regular business day following the day on
  6 34 which the inquiry was received.  The secretary may provide for
  6 35 a computerized system for inquiry and confirmation which may
  7  1 be used in lieu of the inquiry and confirmation system
  7  2 otherwise provided for in this section.
  7  3    In order to verify the existence or nonexistence of a
  7  4 security interest, a buyer may request a seller to disclose
  7  5 the seller's social security number or, in the case of a
  7  6 seller doing business other than as an individual, the
  7  7 internal revenue service taxpayer identification number of the
  7  8 seller.
  7  9    3.  Except as provided in this subsection, a buyer who buys
  7 10 farm products from a seller engaged in farming operations
  7 11 shall take free of a security interest created by the seller,
  7 12 even though the security interest is perfected and the buyer
  7 13 knows of the existence of the interest.
  7 14    a.  In the case where a centralized filing system is
  7 15 utilized as provided in subsection 2, the buyer of farm
  7 16 products takes subject to a security interest in the farm
  7 17 product if either of the following applies:
  7 18    (1)  The buyer fails to register with the secretary prior
  7 19 to the purchase of farm products, and the secured party has
  7 20 filed an effective financing statement or notice that covers
  7 21 the farm products being sold.
  7 22    (2)  The buyer receives from the secretary written notice
  7 23 as provided in subsection 2 that identifies both the seller
  7 24 and the farm product being sold by the seller as being subject
  7 25 to an effective financing statement or notice, and the buyer
  7 26 does not secure a waiver or release of the security interest
  7 27 as specified in the effective financing statement or notice
  7 28 from the secured party by performing any payment obligation.
  7 29    b.  In the case where a centralized filing system is not
  7 30 utilized as provided in subsection 2, the buyer of a farm
  7 31 product takes subject to a security interest in the farm
  7 32 product if, within one year before the sale of the farm
  7 33 product, the buyer receives written notice directly from the
  7 34 secured party or the debtor who sells the farm product.  The
  7 35 written notice must be an original or reproduced copy of the
  8  1 written notice, which is signed by either the secured party or
  8  2 the debtor who transmits the notice to the potential buyer.
  8  3    (1)  The notice must contain all of the following:
  8  4    (a)  The name and address of the secured party.
  8  5    (b)  The name and address of the debtor.
  8  6    (c)  The social security number of the debtor or, in the
  8  7 case of a debtor doing business other than as an individual,
  8  8 the internal revenue service taxpayer identification number of
  8  9 the debtor.
  8 10    (d)  A description of the farm products subject to the
  8 11 security interest created by the debtor, including the amount
  8 12 of the products where applicable.
  8 13    (e)  An identification of the crop year in which the farm
  8 14 products were produced.
  8 15    (f)  An identification of the county in which the farm
  8 16 products were produced.
  8 17    (g)  A reasonable description of the property on which the
  8 18 farm products were produced.
  8 19    (h)  A statement of any payment obligations imposed on the
  8 20 buyer by the secured party as a condition for waiver or
  8 21 release of the security interest.
  8 22    (2)  A secured party may require, in documents creating a
  8 23 security interest, that a debtor engaged in farming
  8 24 operations, who creates a security interest in a farm product,
  8 25 furnish to the secured party a list of potential buyers to or
  8 26 through whom the debtor may sell the farm product.  Before a
  8 27 secured party may furnish a potential buyer who is not on the
  8 28 list with written notice of a security interest in a farm
  8 29 product, the secured party shall notify the debtor of the name
  8 30 and address of the potential buyer.
  8 31    (3)  A written notice shall be amended by the secured party
  8 32 within three months of any material change.  The amended
  8 33 notice shall be signed and transmitted to the potential buyer
  8 34 in the manner required for the original written notice, by
  8 35 either the secured party or the debtor selling the farm
  9  1 products.  A written notice lapses on the earlier of either
  9  2 one year from the date the notice was received by the buyer or
  9  3 the date the buyer receives a notice signed by the secured
  9  4 party that the security interest has lapsed.
  9  5    (4)  For purposes of this section, a written notice shall
  9  6 be considered to be received by the person to whom it was sent
  9  7 or delivered if the notice is delivered in hand to the person
  9  8 with a written receipt returned.  If written notice is mailed
  9  9 by a secured party, the notice must be mailed by certified
  9 10 mail with the proper postage and properly addressed to the
  9 11 person to whom it was sent.  The refusal of a person to whom a
  9 12 notice is sent to accept delivery of the notice shall be
  9 13 considered receipt.
  9 14    (5)  If the written notice to a potential buyer by a
  9 15 secured party or debtor satisfies the requirements of
  9 16 subparagraph (1), and the debtor sells the farm products
  9 17 subject to the security interest to a buyer not included on
  9 18 the list as a potential buyer as required in subparagraph (2),
  9 19 or to any other buyer, if the name and address of the buyer
  9 20 were not received by the debtor pursuant to subparagraph (2),
  9 21 the debtor is subject to a civil penalty of the greater of
  9 22 either five thousand dollars or fifteen percent of the value
  9 23 or benefits received by the debtor for the farm products
  9 24 described in the documents creating the security interest.
  9 25 However, the penalty provided in this subparagraph shall be
  9 26 imposed on the debtor in lieu of but not in addition to the
  9 27 penalty described in 7 U.S.C. } 1631.  A penalty shall not be
  9 28 imposed on the debtor under this subparagraph if the debtor
  9 29 has complied with any of the following:
  9 30    (a)  Notified the secured party in writing of the identity
  9 31 of the buyer at least seven days prior to the sale.
  9 32    (b)  Accounted to the secured party for the proceeds of the
  9 33 sale not later than ten days after the sale.
  9 34    Sec. 4.  DIRECTIONS TO THE SECRETARY OF STATE.  The
  9 35 secretary of state shall adopt rules necessary to implement
 10  1 this division of this Act.  If necessary to obtain federal
 10  2 certification of the central filing system, additional or
 10  3 alternative requirements made in conformity with 7 U.S.C. }
 10  4 1631, may be imposed by the secretary of state by rule.  The
 10  5 secretary of state may computerize the central filing system.
 10  6    Sec. 5.  EFFECTIVE DATE.  This division takes effect on
 10  7 January 1, 2000.  
 10  8                           DIVISION II
 10  9    Sec. 6.  NEW SECTION.  580A.1  DEFINITIONS.
 10 10    As used in this chapter, unless the context otherwise
 10 11 requires:
 10 12    1.  "Agricultural commodity" means any unprocessed
 10 13 agricultural product, including livestock as defined in
 10 14 section 717.1; agricultural crops; hay, straw, or stover; or
 10 15 fruit from fruit trees, if the product is produced in this
 10 16 state for sale in commercial channels.
 10 17    2.  "Agricultural producer" means a person who owns the
 10 18 agricultural commodity that is produced by or under the
 10 19 direction or management of the person.
 10 20    3.  "Commercial channels" means the processes of sale of an
 10 21 agricultural commodity to any person, public or private, who
 10 22 resells the agricultural commodity for breeding, processing,
 10 23 slaughter, or distribution.
 10 24    4.  "Produce" means to provide for the care and feeding of
 10 25 livestock or to plant, grow, or harvest an agricultural
 10 26 commodity other than livestock.
 10 27    Sec. 7.  NEW SECTION.  580A.2  AGRICULTURAL PRODUCER'S
 10 28 LIEN.
 10 29    1.  An agricultural producer has a lien for the contract
 10 30 price of an agricultural commodity produced by the person and
 10 31 delivered to a buyer.  The lien attaches to the agricultural
 10 32 commodity and products created from the agricultural
 10 33 commodities and proceeds received from the sale of the
 10 34 agricultural commodity.
 10 35    2.  If an agricultural commodity is commingled with other
 11  1 agricultural commodities, the lien continues in the
 11  2 proportionate share of the other agricultural commodities.  If
 11  3 an agricultural commodity to which the lien attaches becomes
 11  4 manufactured or processed to become part of another product,
 11  5 the lien continues and attaches to the product manufactured or
 11  6 processed.
 11  7    3.  An agricultural producer's lien does not attach to an
 11  8 agricultural commodity which is purchased free of a security
 11  9 interest in farm products as provided in section 554.9307A.
 11 10    Sec. 8.  NEW SECTION.  580A.3  PERFECTION.
 11 11    An agricultural producer's lien is perfected from the time
 11 12 an agricultural commodity is delivered until forty-five days
 11 13 after the agricultural commodity is delivered without filing.
 11 14 An agricultural producer's lien may continue to be perfected
 11 15 if a lien statement under this chapter is filed with the
 11 16 secretary of state within forty-five days after the
 11 17 agricultural commodity is delivered.
 11 18    Sec. 9.  NEW SECTION.  580A.4  LIEN STATEMENT.
 11 19    1.  A lien statement must be in writing and verified by the
 11 20 producer.  The statement must include all of the following:
 11 21    a.  The amount due for the agricultural commodity after
 11 22 deducting applicable credits and offsets.
 11 23    b.  The name of the purchaser to whom the agricultural
 11 24 commodity was delivered.
 11 25    c.  A description sufficient to identify the agricultural
 11 26 commodity delivered and subject to the lien.
 11 27    d.  The date and location to which the agricultural
 11 28 commodity was delivered.
 11 29    e.  The date when payment was due for the agricultural
 11 30 commodity subject to the lien.
 11 31    2.  A lien statement is void and may be removed from the
 11 32 filing system six months after the date of filing.  The lien
 11 33 statement may be physically destroyed thirty months after the
 11 34 date of filing.
 11 35    Sec. 10.  NEW SECTION.  580A.5  PRIORITY.
 12  1    1.  An agricultural producer's lien has priority over all
 12  2 other liens and encumbrances in all of the following:
 12  3    a.  The agricultural commodity.
 12  4    b.  The proceeds from the agricultural commodity.
 12  5    c.  The proportionate share of the agricultural commodities
 12  6 with which the agricultural commodity has been commingled.
 12  7    d.  The products manufactured or processed with the
 12  8 agricultural commodity.
 12  9    2.  An agricultural producer's lien that is continuously
 12 10 perfected from the time of delivery has priority over other
 12 11 liens and encumbrances whether they are filed before or after
 12 12 the agricultural producer's lien.
 12 13    3.  An agricultural producer's lien that is filed after
 12 14 twenty days after delivery of the agricultural commodity has
 12 15 priority in the order it is filed.
 12 16    4.  Priority among perfected agricultural producers' liens
 12 17 is according to the first lien filed.
 12 18    5.  An agricultural producer's lien that is not perfected
 12 19 has the priority of an unperfected security interest under
 12 20 section 554.9312.
 12 21    Sec. 11.  NEW SECTION.  580A.6  LIEN TERMINATED.
 12 22    An agricultural producer's lien is terminated when any of
 12 23 the following occurs:
 12 24    1.  Full payment is made for the agricultural commodity
 12 25 delivered.
 12 26    2.  The agricultural commodity is recovered in kind.
 12 27    3.  Six months passes after the agricultural commodity was
 12 28 delivered and an action to enforce the lien has not been
 12 29 commenced.
 12 30    Sec. 12.  NEW SECTION.  580A.7  ENFORCEMENT.
 12 31    The holder of an agricultural producer's lien may enforce
 12 32 the lien in the manner provided in sections 554.9501 through
 12 33 554.9507.  For enforcement of the lien, the lienholder is the
 12 34 secured party and the person receiving the agricultural
 12 35 commodity is the debtor, and each has the respective rights
 13  1 and duties of a secured party and a debtor under sections
 13  2 554.9501 through 554.9507.  If a right or duty under sections
 13  3 554.9501 through 554.9507 is contingent upon the existence of
 13  4 express language in a security agreement or may be waived by
 13  5 express language in a security agreement, the requisite
 13  6 language is deemed not to exist.
 13  7    Sec. 13.  NEW SECTION.  580A.8  SATISFACTION OF LIEN.
 13  8    A lienholder must remove a lien statement from the filing
 13  9 system after the lien is satisfied.  If the lienholder does
 13 10 not remove the lien statement, the secretary of state shall
 13 11 remove the lien statement upon request of an affected party
 13 12 providing proof that the lien has terminated.
 13 13    Sec. 14.  NEW SECTION.  580A.9  ENFORCEMENT ACTION.
 13 14    An action to enforce an agricultural producer's lien may be
 13 15 brought in district court in a county where the property to
 13 16 which the lien attaches is located or the county where the
 13 17 agricultural commodity was originally delivered.  The court
 13 18 shall allow costs including attorney fees to the prevailing
 13 19 party.  
 13 20                           EXPLANATION
 13 21    Division I:  Under Code section 554.9307 of Iowa's uniform
 13 22 commercial code, a buyer in the ordinary course of business
 13 23 takes free of a security interest created by the seller,
 13 24 unless the buyer purchases farm products.  This is sometimes
 13 25 referred to as "the farm products rule".  In 1985, Congress
 13 26 enacted legislation providing two approaches for notifying
 13 27 buyers of farm products; a system of certified central filing
 13 28 and the already-existing system for actual notification.
 13 29    In 1987, the general assembly enacted legislation requiring
 13 30 actual notification to buyers.  Under current law, a buyer in
 13 31 the ordinary course of business buying farm products from a
 13 32 debtor engaged in farming operations takes subject to a
 13 33 security interest created by the debtor only if within one
 13 34 year before the sale of the farm products the buyer receives
 13 35 prior written notice of the security interest.
 14  1    This division creates a centralized filing system for this
 14  2 state.  The system is administered by the secretary of state
 14  3 who must provide for filing effective financing statements on
 14  4 a statewide basis.  The secretary of state must produce a
 14  5 master list of information required to be contained in the
 14  6 effective financing statements.  The division provides
 14  7 requirements for the contents and duration of an effective
 14  8 financing statement.  The division provides for the
 14  9 distribution of information by the secretary regarding
 14 10 effective financing statements to interested persons by
 14 11 sending the information to buyers registered with the
 14 12 secretary and by answering specific oral and written
 14 13 inquiries.
 14 14    The division authorizes the secretary of state to establish
 14 15 fees for filing effective financing statements and
 14 16 distributing information.  The division provides for penalties
 14 17 for persons who fail to provide lists of potential buyers to
 14 18 secured parties.  The division takes effect on January 1,
 14 19 2000.
 14 20    Division II:  This division creates an agricultural
 14 21 producer's lien for the value of agricultural commodities sold
 14 22 by a producer.  The lien attaches to the agricultural
 14 23 commodity and products created by the agricultural commodity
 14 24 and proceeds received from the sale of the agricultural
 14 25 commodity.  If the agricultural commodity is commingled with
 14 26 other agricultural commodities, the lien continues in the
 14 27 proportionate share of the other agricultural commodities.  If
 14 28 an agricultural commodity to which the lien attaches becomes
 14 29 manufactured or processed to become part of another product,
 14 30 the lien continues and attaches to the product manufactured or
 14 31 processed.  The division provides for the mechanics of
 14 32 perfecting a lien, including the filing of a lien statement,
 14 33 and provides for the enforcement and termination of the lien.
 14 34 The bill provides that the lien has priority over all other
 14 35 liens and encumbrances in the agricultural commodity, the
 15  1 proceeds from the agricultural commodity, the proportionate
 15  2 share of the agricultural commodities with which the
 15  3 agricultural commodity has been commingled, and products
 15  4 manufactured or processed with the agricultural commodity.  
 15  5 LSB 2152HH 78
 15  6 da/jw/5
     

Text: HF00398                           Text: HF00400
Text: HF00300 - HF00399                 Text: HF Index
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