House File 531 - Introduced



                                       HOUSE FILE       
                                       BY  KUHN


    Passed House,  Date               Passed Senate, Date             
    Vote:  Ayes        Nays           Vote:  Ayes        Nays         
                 Approved                            

                                      A BILL FOR

  1 An Act providing for a right to rescind a future grain delivery
  2    contract, and providing an effective date.
  3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
  4 TLSB 2138HH 83
  5 da/nh/5

PAG LIN



  1  1    Section 1.  NEW SECTION.  203B.1  DEFINITIONS.
  1  2    As used in this chapter, unless the context otherwise
  1  3 requires:
  1  4    1.  "Future grain delivery contract" or "contract" means a
  1  5 contract for the sale of grain, in which a buyer and seller
  1  6 agree upon the delivery of a specified quality and quantity of
  1  7 grain during one or more specified future periods or upon the
  1  8 satisfaction of one or more future conditions at least thirty
  1  9 days after the execution of the contract.
  1 10    2.  "Grain" means the same as defined in section 203.1.
  1 11    3.  "Grain dealer" means a person required to be licensed
  1 12 to engage in the business of a grain dealer pursuant to
  1 13 section 203.3.
  1 14    4.  "Seller" means a person who sells grain to a grain
  1 15 dealer under a future grain delivery contract.
  1 16    Sec. 2.  NEW SECTION.  203B.2  RIGHT OF SELLER TO RESCIND
  1 17 FUTURE GRAIN DELIVERY CONTRACT.
  1 18    1.  a.  A seller may unilaterally rescind a future grain
  1 19 delivery contract executed with a grain dealer for breach of
  1 20 contract based on the grain dealer's failure to provide
  1 21 consideration for the grain as required in the contract.
  1 22 Provisions in the contract which require the future delivery
  1 23 of grain are not severable, and shall also be rescinded.  Any
  1 24 other such contract executed by the seller and the grain
  1 25 dealer which also requires the future delivery of grain shall
  1 26 be deemed part of the same contract, and shall also be
  1 27 rescinded.
  1 28    2.  The recision of a future grain delivery contract as
  1 29 provided in subsection 1 becomes effective when the seller
  1 30 does all of the following:
  1 31    a.  Notifies the grain dealer of the recision by certified
  1 32 mail as provided in section 618.15.
  1 33    b.  Repays the grain dealer any amount paid to the person
  1 34 for future deliveries as provided in the contract.
  1 35    3.  A waiver of a right to rescind a future grain delivery
  2  1 contract as provided in this section is void and
  2  2 unenforceable.  However, this subsection does not affect other
  2  3 provisions of a contract or a related document, policy, or
  2  4 agreement which can be given effect without the voided
  2  5 provision.
  2  6    Sec. 3.  EFFECTIVE DATE.  This Act, being deemed of
  2  7 immediate importance, takes effect upon enactment.
  2  8                           EXPLANATION
  2  9    This bill applies to a person who sells grain to a grain
  2 10 dealer required to be licensed by the department of
  2 11 agriculture and land stewardship under a future grain delivery
  2 12 contract.  The bill provides that a seller may unilaterally
  2 13 rescind the contract based on the grain dealer's failure to
  2 14 provide payment.  The recision includes any other provision in
  2 15 the contract requiring future delivery.  In addition, any
  2 16 other contracts executed by the parties which require the
  2 17 future delivery of grain are similarly rescinded.  The
  2 18 recision takes effect when the seller notifies the licensed
  2 19 grain dealer and repays any amount received under the contract
  2 20 or contracts.
  2 21    The bill takes effect upon enactment.
  2 22 LSB 2138HH 83
  2 23 da/nh/5