House Journal: Page 993: Thursday, April 3, 2003
42 dealer to the United States packers and stockyards
43 administration. However, the evidence of financial
44 responsibility shall not be for less than fifty
45 thousand dollars or for more than three hundred
46 thousand dollars.
47 4. The evidence of financial responsibility must
48 be conditioned upon the dealer's faithful performance
49 of the terms and conditions of the sales agreement.
50 The surety's or issuer's liability extends to each
Page 2
1 such sales agreement executed while the surety bond or
2 letter of credit is in force and until performance or
3 the recision of the sales agreement.
4 5. The evidence of financial responsibility shall
5 be continuous in nature until canceled by the surety
6 or issuer. The surety or issuer shall provide at
7 least ninety days' notice in writing to the dealer and
8 the department indicating the surety's or issuer's
9 intent to cancel the surety bond or letter of credit
10 and the effective date of the cancellation. The
11 dealer shall have sixty days from the date of receipt
12 of the surety's or issuer's notice of cancellation to
13 file a replacement. However, the surety or issuer
14 remains liable for damages arising from sales
15 agreements which were executed during the effective
16 period of the evidence of financial responsibility.
17 Sec. . NEW SECTION. 202C.3 SURETY OR ISSUER
18 - LIABILITY.
19 1. The purchaser may bring a legal action arising
20 from the breach of a sales agreement against the
21 surety on the bond or issuer on the irrevocable letter
22 of credit in the purchaser's own name in district
23 court to recover any damages as allowed by law. The
24 purchaser may also be awarded interest as determined
25 pursuant to section 668.13, beginning from the date
26 that the sales agreement was executed. The purchaser
27 may also be awarded court costs and reasonable
28 attorney fees, which shall be taxed as part of the
29 costs of the legal action.
30 2. The aggregate liability of the surety or issuer
31 due to a breach of a sales agreement shall not exceed
32 the amount of the evidence of financial
33 responsibility.
34 Sec. . NEW SECTION. 202C.4 DEPARTMENTAL
35 RULES.
36 The department shall adopt rules as required to
37 administer this chapter, including but not limited to
38 rules providing for amounts of evidence of financial
39 responsibility, qualifications for a surety or
40 financial institution, procedures for filing evidence
© 2003 Cornell College and
League of Women Voters of Iowa
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