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Senate Study Bill 3169 - IntroducedA Bill ForAn Act 1relating to a landlord’s lien on farm products and
2including applicability provisions.
3BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 554.7209, Code 2020, is amended by adding
2the following new subsection:
3 NEW SUBSECTION. 2A. A warehouse’s lien created in
4subsection 1 is not effective against a landlord perfecting an
5agricultural lien as provided in section 570.1.
6 Sec. 2. Section 570.1, subsections 1 and 2, Code 2020, are
7amended to read as follows:
81. A landlord shall have a lien for the rent upon all crops
9grown farm products as defined in section 554.9102, produced
10 upon the leased premises, and upon any other personal property
11of the tenant which has been used or kept thereon during the
12term and which is not exempt from execution.
132. In order to perfect a lien in farm products as defined
14in section 554.9102, which is created under this section, a
15landlord must file a financing statement as required by section
16554.9308, subsection 2. Except as provided in chapters 571,
17 chapter 572, 579A, 579B, and 581, a perfected lien in the
18farm products has priority over a any conflicting security
19interest or lien, including a security interest or lien that
20was perfected prior to the creation of the lien under this
21section, if the lien created in this section is perfected on
22either of the following dates:
23a. Prior to July 1, 2001.
24b. When when the debtor takes possession of the leased
25premises or within twenty days after the debtor takes
26possession of the leased premises.
27 Sec. 3. Section 571.3A, subsection 2, Code 2020, is amended
28to read as follows:
292. A harvester’s lien that is perfected under section 571.3
30shall have priority over a conflicting security interest in
31harvested crops regardless of when such security interest is
32perfected. A However, a perfected harvester’s lien shall not
33 have priority over a conflicting landlord’s lien as provided
34in chapter 570, regardless of when such landlord’s lien is
35perfected.
-1-1 Sec. 4. Section 579A.2, subsection 5, paragraph b, Code
22020, is amended to read as follows:
3b. Notwithstanding paragraph “a”, a custom cattle feedlot
4lien shall not be superior to a any of the following:
5(1) Acourt-ordered lien provided in section 717.4.
6(2) A landlord’s lien created under chapter 570or a
7veterinarian’s lien created under chapter 581, if such lien is
8perfected as an agricultural lien as provided in chapter 554,
9article 9.
10 Sec. 5. Section 579B.4, subsection 4, paragraph a,
11subparagraph (2), Code 2020, is amended to read as follows:
12(2) Notwithstanding subparagraph (1), a commodity
13production contract lien shall not be superior to a any of the
14following:
15(a) Acourt-ordered lien provided in section 717.4.
16(b) A landlord’s lien created under chapter 570or a
17veterinarian’s lien created under chapter 581, if such lien is
18perfected as an agricultural lien.
19 Sec. 6. Section 581.2, subsection 2, paragraph b, Code 2020,
20is amended to read as follows:
21b. Notwithstanding paragraph “a”, a veterinarian’s lien
22shall not be superior to a any of the following:
23(1) Acourt-ordered lien provided in section 717.4, if such
24lien is perfected as an agricultural lien.
25(2) A landlord’s lien created under chapter 570, if such
26lien is perfected as an agricultural lien.
27 Sec. 7. APPLICABILITY. This Act applies to leases entered
28into on and after July 1, 2020.
29EXPLANATION
30The inclusion of this explanation does not constitute agreement with
31the explanation’s substance by the members of the general assembly.
32GENERAL. This bill provides that a landlord’s lien has
33priority over security interests and other agricultural
34liens covering farm products produced on the leased farmland,
35including a security interest perfected under Iowa’s version
-2-1of the uniform commercial code (UCC) (Code chapter 554,
2article 9), a warehouse lien under the uniform commercial code
3(Code section 554.7209), and an agricultural lien including a
4harvester’s lien (Code chapter 571), a custom cattle feedlot
5lien (Code chapter 579A), a commodity production contract lien
6(Code chapter 579B), and a veterinarian’s lien (Code chapter
7581).
8BACKGROUND. Under Iowa’s version of the UCC, article 9,
9a security interest is created by a contract referred to as
10a security agreement executed by a creditor and debtor that
11creates a financial obligation (Code section 554.9201). The
12security interest attaches to the debtor’s collateral (Code
13section 554.9203) and based on that agreement the creditor
14may perfect the security interest by filing a financing
15statement with the secretary of state (Code section 554.9310).
16Possession is also a means to perfect a security interest,
17including general warehouse lien allowed under the UCC,
18article 7 (Code section 554.7209). In addition, various Code
19chapters existing outside the UCC create agricultural liens in
20commodities produced by a farming operation. An agricultural
21lien is a statutory lien that may secure the payment of a
22financial obligation associated with commodity production, and
23is not necessarily possessory, meaning that it may continue to
24cover the commodity after harvest and delivery (Code section
25554.9102(1)(e)). However, an agricultural lien must be
26perfected by filing a financing statement with the secretary
27of state (Code section 554.9310). Once a lien is created, it
28receives a degree of priority over the covered collateral among
29competing creditors seeking to enforce a debt. Generally,
30under the UCC, article 9, the status of a creditor’s priority
31is based on the date of the security interest’s perfection.
32However, certain statutes outside the UCC, article 9, provide
33a special status to lienholders, including those holding
34agricultural liens.
35APPLICABILITY. The bill applies to leases entered into,
-3-1renewed, or otherwise continued on and after July 1, 2020.
-4-da/jh
2including applicability provisions.
3BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 554.7209, Code 2020, is amended by adding
2the following new subsection:
3 NEW SUBSECTION. 2A. A warehouse’s lien created in
4subsection 1 is not effective against a landlord perfecting an
5agricultural lien as provided in section 570.1.
6 Sec. 2. Section 570.1, subsections 1 and 2, Code 2020, are
7amended to read as follows:
81. A landlord shall have a lien for the rent upon all crops
9grown farm products as defined in section 554.9102, produced
10 upon the leased premises, and upon any other personal property
11of the tenant which has been used or kept thereon during the
12term and which is not exempt from execution.
132. In order to perfect a lien in farm products as defined
14in section 554.9102, which is created under this section, a
15landlord must file a financing statement as required by section
16554.9308, subsection 2. Except as provided in chapters 571,
17 chapter 572, 579A, 579B, and 581, a perfected lien in the
18farm products has priority over a any conflicting security
19interest or lien, including a security interest or lien that
20was perfected prior to the creation of the lien under this
21section, if the lien created in this section is perfected on
22either of the following dates:
23a. Prior to July 1, 2001.
24b. When when the debtor takes possession of the leased
25premises or within twenty days after the debtor takes
26possession of the leased premises.
27 Sec. 3. Section 571.3A, subsection 2, Code 2020, is amended
28to read as follows:
292. A harvester’s lien that is perfected under section 571.3
30shall have priority over a conflicting security interest in
31harvested crops regardless of when such security interest is
32perfected. A However, a perfected harvester’s lien shall not
33 have priority over a conflicting landlord’s lien as provided
34in chapter 570, regardless of when such landlord’s lien is
35perfected.
-1-1 Sec. 4. Section 579A.2, subsection 5, paragraph b, Code
22020, is amended to read as follows:
3b. Notwithstanding paragraph “a”, a custom cattle feedlot
4lien shall not be superior to a any of the following:
5(1) Acourt-ordered lien provided in section 717.4.
6(2) A landlord’s lien created under chapter 570or a
7veterinarian’s lien created under chapter 581, if such lien is
8perfected as an agricultural lien as provided in chapter 554,
9article 9.
10 Sec. 5. Section 579B.4, subsection 4, paragraph a,
11subparagraph (2), Code 2020, is amended to read as follows:
12(2) Notwithstanding subparagraph (1), a commodity
13production contract lien shall not be superior to a any of the
14following:
15(a) Acourt-ordered lien provided in section 717.4.
16(b) A landlord’s lien created under chapter 570or a
17veterinarian’s lien created under chapter 581, if such lien is
18perfected as an agricultural lien.
19 Sec. 6. Section 581.2, subsection 2, paragraph b, Code 2020,
20is amended to read as follows:
21b. Notwithstanding paragraph “a”, a veterinarian’s lien
22shall not be superior to a any of the following:
23(1) Acourt-ordered lien provided in section 717.4, if such
24lien is perfected as an agricultural lien.
25(2) A landlord’s lien created under chapter 570, if such
26lien is perfected as an agricultural lien.
27 Sec. 7. APPLICABILITY. This Act applies to leases entered
28into on and after July 1, 2020.
29EXPLANATION
30The inclusion of this explanation does not constitute agreement with
31the explanation’s substance by the members of the general assembly.
32GENERAL. This bill provides that a landlord’s lien has
33priority over security interests and other agricultural
34liens covering farm products produced on the leased farmland,
35including a security interest perfected under Iowa’s version
-2-1of the uniform commercial code (UCC) (Code chapter 554,
2article 9), a warehouse lien under the uniform commercial code
3(Code section 554.7209), and an agricultural lien including a
4harvester’s lien (Code chapter 571), a custom cattle feedlot
5lien (Code chapter 579A), a commodity production contract lien
6(Code chapter 579B), and a veterinarian’s lien (Code chapter
7581).
8BACKGROUND. Under Iowa’s version of the UCC, article 9,
9a security interest is created by a contract referred to as
10a security agreement executed by a creditor and debtor that
11creates a financial obligation (Code section 554.9201). The
12security interest attaches to the debtor’s collateral (Code
13section 554.9203) and based on that agreement the creditor
14may perfect the security interest by filing a financing
15statement with the secretary of state (Code section 554.9310).
16Possession is also a means to perfect a security interest,
17including general warehouse lien allowed under the UCC,
18article 7 (Code section 554.7209). In addition, various Code
19chapters existing outside the UCC create agricultural liens in
20commodities produced by a farming operation. An agricultural
21lien is a statutory lien that may secure the payment of a
22financial obligation associated with commodity production, and
23is not necessarily possessory, meaning that it may continue to
24cover the commodity after harvest and delivery (Code section
25554.9102(1)(e)). However, an agricultural lien must be
26perfected by filing a financing statement with the secretary
27of state (Code section 554.9310). Once a lien is created, it
28receives a degree of priority over the covered collateral among
29competing creditors seeking to enforce a debt. Generally,
30under the UCC, article 9, the status of a creditor’s priority
31is based on the date of the security interest’s perfection.
32However, certain statutes outside the UCC, article 9, provide
33a special status to lienholders, including those holding
34agricultural liens.
35APPLICABILITY. The bill applies to leases entered into,
-3-1renewed, or otherwise continued on and after July 1, 2020.
-4-da/jh