Text: HSB00698 Text: HSB00700 Text: HSB00600 - HSB00699 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 Section 1. Section 202.1, subsections 1 and 12, Code 2001, 1 2 are amended by striking the subsections. 1 3 Sec. 2. Section 202.1, subsections 3, 4, 6, 7, 8, 10, and 1 4 14, Code 2001, are amended to read as follows: 1 5 3. "Contract crop field" means farmland where a crop is 1 6 produced according to a production contract executed pursuant 1 7 tosection 202.2this chapter by a contract producer who holds 1 8 a legal interest in the farmland. 1 9 4. "Contract livestock facility" means an animal feeding 1 10 operation as defined in section 455B.161, in which livestock 1 11 or raw milk is produced according to a production contract 1 12 executed pursuant tosection 202.2this chapter by a contract 1 13 producer who holds a legal interest in the animal feeding 1 14 operation. "Contract livestock facility" includes a 1 15 confinement feeding operation as defined in section 455B.161, 1 16 an open feedlot, or an area which is used for the raising of 1 17 crops or other vegetation and upon which livestock is fed for 1 18 slaughter or is allowed to graze or feed. 1 19 6. "Contract producer" means a person who holds a legal 1 20 interest ina contract operation and who produces a commodity1 21at the contract producer's contract operation under a1 22production contract executed pursuant to section 202.2a 1 23 livestock facility or crop field and who produces a commodity 1 24 at the livestock facility or crop field under the provisions 1 25 of an agricultural contract. "Contract producer" does not 1 26 include a commercial fertilizer or pesticide applicator, a 1 27 feed supplier, or a veterinarian, when acting in such 1 28 capacity. 1 29 7. "Contractor" meansan active contractor or a passive1 30contractora person who owns a commodity that is produced by a 1 31 contract producer. A contractor includes an association 1 32 organized on a cooperative basis in which another cooperative 1 33 association organized under chapter 497, 498, 499, or 501 is a 1 34 member, if the association contracts with a member which is a 1 35 cooperative association organized under chapter 497, 498, 499, 2 1 or 501, which contracts for the care and feeding of swine with 2 2 a member of the cooperative association who is actively 2 3 engaged in farming. 2 4 8. a. "Crop" means a plant used for or processed into 2 5 food, animal feed, fiber,oroil, fuel, or a pharmaceutical or 2 6 nutriceutical product, if the plant is classified as a forage 2 7 or cereal plant, including but not limited to alfalfa, barley, 2 8 buckwheat, corn, flax, forage, millet, oats, popcorn, rye, 2 9 sorghum, soybeans, sunflowers, wheat, and grasses used for 2 10 forage or silage. 2 11 b.A "crop""Crop" does not include trees or nuts or fruit 2 12 grown on trees; sod; shrubs; greenhouse plants; or plants or 2 13 plant parts produced for precommercial, experimental, or 2 14 research purposes. 2 15 10. "Livestock" meansbeef cattle, dairy cattle, sheep, or2 16swinea domesticated animal belonging to the bovine, porcine, 2 17 ovine, caprine, or avian species. 2 18 14. "Production contract" means an oral or written 2 19 agreementexecuted pursuant to section 202.2that provides for 2 20 the production of a commodity orthe provision of management2 21services relating to the production of a commodity by a2 22contract producerthe production of a commodity in return for 2 23 consideration paid by a contractor, if the consideration has 2 24 value of ten thousand dollars or more. 2 25 Sec. 3. Section 202.1, Code 2001, is amended by adding the 2 26 following new subsections: 2 27 NEW SUBSECTION. 1A. "Agricultural contract" means a 2 28 marketing contract or a production contract. 2 29 NEW SUBSECTION. 8A. "Crop field" means farmland where a 2 30 crop is produced by a contract producer who holds a legal 2 31 interest in the farmland. 2 32 NEW SUBSECTION. 10A. "Livestock facility" means an animal 2 33 feeding operation as defined in section 455B.161, in which 2 34 livestock or raw milk is produced by a contract producer who 2 35 holds a legal interest in the animal feeding operation. 3 1 "Livestock facility" includes a confinement feeding operation 3 2 as defined in section 455B.161, an open feedlot, or an area 3 3 which is used for the raising of crops or other vegetation and 3 4 upon which livestock is fed for slaughter or is allowed to 3 5 graze or feed. 3 6 NEW SUBSECTION. 10B. "Marketing contract" means an oral 3 7 or written agreement between a processor and a contract 3 8 producer for the purchase of a commodity that is produced by 3 9 the contract producer in this state. 3 10 NEW SUBSECTION. 12A. "Processing" means turning an 3 11 agricultural commodity into an agricultural product by 3 12 physical or chemical modification, including but not limited 3 13 to canning, freezing, drying, dehydrating, cooking, pressing, 3 14 powdering, packaging, repackaging, baking, heating, mixing, 3 15 grinding, churning, separating, extracting, cutting, 3 16 fermenting, eviscerating, preserving, jarring, brewing, or 3 17 slaughtering. 3 18 NEW SUBSECTION. 12B. "Processor" means a person who alone 3 19 or in conjunction with others, directly or indirectly, 3 20 controls a processing business that creates products having a 3 21 total annual wholesale value of ten million dollars or more 3 22 for the person's tax year. 3 23 Sec. 4. NEW SECTION. 202.2A AGRICULTURAL CONTRACTS. 3 24 1. An agricultural contract is executed when it is signed 3 25 or orally agreed to by each party or by a person who is 3 26 authorized by a party to act on the party's behalf. 3 27 2. An agricultural contract which includes both terms in a 3 28 production contract and a marketing contract shall be deemed 3 29 to be a production contract. 3 30 Sec. 5. NEW SECTION. 202.2B APPLICABILITY. 3 31 1. This chapter does not apply to an agricultural contract 3 32 for the production or marketing of a commodity produced at a 3 33 livestock facility or crop field located in this state if any 3 34 of the following apply: 3 35 a. The principal place of business of all parties to the 4 1 agricultural contract is not located in this state. 4 2 b. The livestock facility or crop field is not located in 4 3 this state. 4 4 2. This chapter does not apply to an agricultural contract 4 5 solely because the agricultural contract provides that it is 4 6 subject to or governed by the laws of this state. 4 7 Sec. 6. NEW SECTION. 202.2C CHOICE OF LAW – 4 8 JURISDICTION – FORUM. 4 9 1. A provision in an agricultural contract providing that 4 10 the law of another state applies to the agricultural contract 4 11 is void and unenforceable if the contract producer's principal 4 12 place of business is located in this state. 4 13 2. a. A provision in an agricultural contract restricting 4 14 jurisdiction to a forum outside this state is void with 4 15 respect to a claim otherwise enforceable under this chapter. 4 16 A civil action or proceeding arising out of an agricultural 4 17 contract may be commenced wherever jurisdiction over the 4 18 parties or subject matter exists, even if the contract limits 4 19 actions or proceedings to a designated jurisdiction. 4 20 b. Venue for a civil action commenced under this chapter 4 21 shall be determined by the location of the crop field or 4 22 livestock facility where the commodity is produced in 4 23 accordance with the terms of an agricultural contract. 4 24 Sec. 7. NEW SECTION. 202.2D MEDIATION AND ARBITRATION. 4 25 1. An agricultural contract shall contain provisions for 4 26 resolution of disputes concerning the contract by mediation or 4 27 nonbinding arbitration. 4 28 2. An agricultural contract shall not contain provisions 4 29 for resolution of disputes concerning the agricultural 4 30 contract by binding arbitration. A provision contained in an 4 31 agricultural contract providing for binding resolution is 4 32 voidable by the contract producer. The contract producer may 4 33 accept a provision for binding arbitration after a dispute has 4 34 manifested and where all parties to the contract agree to the 4 35 person serving as the arbitrator or to the arbitration panel. 5 1 Sec. 8. NEW SECTION. 202.2E WAIVERS. 5 2 A provision of an agricultural contract that requires or 5 3 allows a contract producer to waive a right as provided in 5 4 this chapter is void and unenforceable. A provision of an 5 5 agricultural contract that requires or allows a contractor or 5 6 processor to waive an obligation as provided in this chapter, 5 7 is also void and unenforceable. 5 8 Sec. 9. NEW SECTION. 202.2F IMPLIED OBLIGATION OF GOOD 5 9 FAITH. 5 10 An agricultural contract imposes an obligation of good 5 11 faith on all parties with respect to the performance and 5 12 enforcement of the agricultural contract. For purposes of 5 13 this section, "good faith" means honesty in fact and the 5 14 observance of reasonable commercial standards of fair dealing 5 15 in the trade. 5 16 Sec. 10. NEW SECTION. 202.2G VOIDED PROVISIONS – 5 17 SEVERABILITY. 5 18 If this chapter provides that a provision in an 5 19 agricultural contract is void and unenforceable or voidable by 5 20 the contract producer, the voiding of the provision does not 5 21 affect any other provision of the agricultural contract which 5 22 can be given effect without the void or voidable provision. 5 23 Sec. 11. Section 202.5, Code 2001, is amended by striking 5 24 the section and inserting in lieu thereof the following: 5 25 202.5 CIVIL ACTIONS. 5 26 1. A contract producer who suffers damages because of a 5 27 contractor's or processor's violation of this chapter may 5 28 obtain appropriate legal and equitable relief, including 5 29 punitive damages, in a suit at common law pursuant to Iowa's 5 30 rules of civil procedure. 5 31 a. In such a civil action against the contractor or 5 32 processor where the contract producer is the prevailing party, 5 33 the court shall award the contract producer court costs, 5 34 reasonable attorney fees, and reasonable litigation expenses, 5 35 as determined by the court and taxed as court costs. 6 1 b. In order to obtain injunctive relief, the contract 6 2 producer is not required to post a bond, prove the absence of 6 3 an adequate remedy at law, or show the existence of special 6 4 circumstances, unless the court for good cause otherwise 6 5 orders. The court may order any form of prohibitory or 6 6 mandatory relief that is appropriate under principles of 6 7 equity, including but not limited to issuing a temporary or 6 8 permanent restraining order. 6 9 2. The attorney general may enforce a contract producer's 6 10 rights under this chapter against a contractor or processor, 6 11 including an employee or agent of the contractor or processor, 6 12 who takes actions to impede such right. The attorney general 6 13 may do all of the following: 6 14 a. Bring an action in district court to impose and award 6 15 civil penalties under subsection 3. 6 16 b. Apply to the district court for an injunction to 6 17 restrain the contractor or processor from engaging in conduct 6 18 or practices in violation of a contract producer's right or to 6 19 require a contractor or processor to comply with this chapter. 6 20 c. Apply to the district court for the issuance of a 6 21 subpoena to obtain an agricultural contract for purposes of 6 22 enforcing this chapter. 6 23 3. The district court may impose civil penalties against a 6 24 contractor or processor who violates this chapter. The court 6 25 shall impose a civil penalty in an amount not to exceed five 6 26 thousand dollars. Each day that a violation continues shall 6 27 constitute a separate violation. The amount of the civil 6 28 penalties shall be awarded to the contract producer who is a 6 29 party to the agricultural contract that is the subject of the 6 30 violation. 6 31 Sec. 12. Section 202.2, Code 2001, is repealed. 6 32 Sec. 13. EFFECTIVE DATE. This Act, being deemed of 6 33 immediate importance, takes effect upon enactment. 6 34 EXPLANATION 6 35 This bill provides the relationship between persons who 7 1 enter into contracts for the production and marketing of 7 2 agricultural commodities. The bill applies to agricultural 7 3 producers and to contractors and processors who enter into a 7 4 contractual relationship with agricultural producers (referred 7 5 to as contract producers). 7 6 The bill amends Code chapter 202 which governs production 7 7 contracts. The bill amends the Code chapter by providing for 7 8 marketing contracts. The two types of contracts are referred 7 9 to as agricultural contracts. The bill provides that the Code 7 10 chapter does not apply to an agricultural contract for the 7 11 production or marketing of a commodity produced at a livestock 7 12 facility or crop field located in this state if the principal 7 13 place of business of all parties to the agricultural contract 7 14 is not located in this state or the livestock facility or crop 7 15 field is not located in this state. 7 16 The bill provides that a provision in an agricultural 7 17 contract providing that the law of another state applies to 7 18 the agricultural contract, is void and unenforceable, if the 7 19 contract producer's principal place of business is located in 7 20 this state. The bill provides for jurisdiction and venue 7 21 where a cause of action is brought under the Code chapter. 7 22 The bill provides that an agricultural contract must 7 23 contain provisions for resolution of disputes concerning the 7 24 contract by mediation or nonbinding arbitration. It prohibits 7 25 an agricultural contract from containing provisions requiring 7 26 binding arbitration. 7 27 The bill provides that an agricultural contract imposes an 7 28 obligation of good faith on all parties. It also provides 7 29 that if a provision in an agricultural contract is void and 7 30 unenforceable or voidable by the contract producer, the 7 31 voiding of the provision does not affect any other provision 7 32 of an agricultural contract which can be given effect without 7 33 the void or voidable provision. 7 34 The bill provides that contract producers who suffer 7 35 damages because of a contractor's or processor's violation of 8 1 the bill may obtain appropriate legal and equitable relief, 8 2 including punitive damages, in a suit at common law pursuant 8 3 to Iowa's rules of civil procedure. The attorney general may 8 4 bring a cause of action on behalf of a producer. 8 5 A district court may impose civil penalties against a 8 6 contractor or processor who violates the bill's provisions. 8 7 The amount of the civil penalty cannot exceed $5,000 for each 8 8 day of the violation. 8 9 The bill takes effect upon enactment. 8 10 LSB 6904YC 79 8 11 da/hk/91
Text: HSB00698 Text: HSB00700 Text: HSB00600 - HSB00699 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
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