HB0066 - Producer's lien law.

2001

State of Wyoming

01LSO-0111

Substitute No. 1

HOUSE BILL NO. HB0066

Producer's lien law.

Sponsored by: Joint Judiciary Interim Committee

A BILL

for

1 AN ACT relating to producer's liens; creating a lien on
2 farm products sold or grown for another or held for
3 processing or storage; requiring a lienholder to give
4 notice of the lien; specifying procedures; specifying
5 waivers in contracts of the terms of this act as
6 unenforceable; allowing for recovery of damages by a
7 producer; specifying applicability; and providing for an
8 effective date.

10 Be It Enacted by the Legislature of the State of Wyoming:

12 Section 1. W.S. 29-8-101 through 29-8-109 are created
13 to read:

15 CHAPTER 8

16 AGRICULTURAL PRODUCER'S LIENS

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1 29-8-101. Definitions.

3 (a) As used in this article:

5 (i) "Commodity dealer" means a person who
6 engages in a business involving or, as part of the
7 business, participates in buying, exchanging, negotiating
8 or soliciting the sale, resale, exchange, production or
9 transfer of any farm product in the state of Wyoming. The
10 term does not include:

12 (A) A person engaged solely in storing,
13 shipping or handling farm products for hire;

15 (B) A person who buys farm products from a
16 licensed commodity dealer;

18 (C) A person who does not purchase more
19 than thirty thousand dollars ($30,000.00) worth of farm
20 products from producers during a licensing year;

22 (D) A person who is the producer of farm
23 products that the person actually plants, nurtures and
24 harvests;

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2 (E) A person whose trading in farm products
3 is limited to trading in commodity futures on a recognized
4 futures exchange; or

6 (F) A person who buys farm products used
7 exclusively for the feeding of livestock and not for
8 resale.

10 (ii) "Contractor" means a person who owns a farm
11 product that is produced by a producer according to a
12 contract;

14 (iii) "Farm products" means all crops, crop
15 products, plants or portions thereof, whether or not they
16 are cleaned, processed, treated, reconditioned, rolled,
17 mixed or combined in any fashion. Farm products shall not
18 mean livestock;

20 (iv) "Person" means an individual, trust,
21 partnership, business trust, corporation or unincorporated
22 association or any other legal or commercial entity;

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1 (v) "Processor" means any person engaged in the
2 business of processing or manufacturing any farm product
3 and who takes possession or control of any farm product for
4 the purpose of processing, cleaning, selling or storing it;

6 (vi) "Producer" means the owner, tenant or
7 operator of land located in the state of Wyoming who has an
8 interest in or receives all or part of the proceeds from
9 the assignment, sale, transfer, exchange or production of
10 farm products grown or produced on that land;

12 (vii) "Public warehouse" or "warehouse" means an
13 elevator, mill, warehouse, subterminal grain warehouse,
14 public warehouse or other structure or facility in which,
15 for compensation, farm products are received for storage,
16 handling, processing or shipment. The term includes
17 facilities that commingle different lots of farm products;

19 (viii) "This act" means W.S. 29-8-101 through
20 29-8-109.

22 29-8-102. Producer's liens.

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1 A producer has a lien on all farm products grown or
2 produced by it and on all proceeds from the assignment,
3 sale, transfer, exchange or other disposition thereof until
4 the producer is paid in full all amounts due the producer
5 for its assignment, sale, transfer, exchange, other
6 disposition or production of the farm products.

8 29-8-103. Notice; filing of notice of claim;
9 contents.

11 (a) A lien created under W.S. 29-8-102 attaches when
12 the farm product is delivered from the producer to the
13 processor, contractor, warehouse operator or commodity
14 dealer.

16 (b) A person claiming a lien created by this act
17 shall file a written notice of claim of lien with the
18 office of the secretary of state not later than one hundred
19 eighty (180) days after the lien attaches.

21 (c) The notice of claim of lien required under
22 subsection (b) of this section shall be in the form of a
23 financing statement acceptable for filing by the office of
24 the secretary of state. The signature of the processor,

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1 contractor, warehouse operator or commodity dealer shall
2 not be required. The written notice of claim filed under
3 subsection (c) of this section shall contain:

5 (i) A true statement of the lienholder's claim;

7 (ii) A description of the farm product delivered
8 sufficient for identification;

10 (iii) A statement that the amount claimed is a
11 true bona fide existing debt as of the date of the filing
12 of notice of claim of lien;

14 (iv) The date on which payment was due or is to
15 become due to the lienholder for the farm product delivered
16 as per individual contract or agreement;

18 (v) The lienholder's name, address and phone
19 number, establishing them as a secured party; and

21 (vi) The name and address of the processor,
22 contractor, warehouse operator or commodity dealer,
23 establishing them as the debtor.

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1 (d) The secretary of state shall keep a record of
2 notices filed under this section under an index of
3 agricultural liens.

5 (e) The secretary of state shall charge a fee not
6 exceeding the cost of providing the service for filing of
7 notices and requests for copies of such notices.

9 (f) When a lienholder files a notice of claim of lien
10 as required by this section, the lienholder shall send a
11 copy of the notice to the processor, contractor, warehouse
12 operator or commodity dealer by registered or certified
13 mail.

15 (g) When a lienholder files a notice of claim of lien
16 as required by this section the lienholder shall send a
17 copy of the notice to all holders of security interests in
18 the product who duly perfected such security interests by
19 filing notice thereof with the secretary of state. The
20 notice shall be mailed to holders of perfected security
21 interests within thirty (30) days after the date of filing
22 the notice of claim.

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1 (h) A lien which has attached under subsection (a) of
2 this section is perfected upon the completion of the
3 requirements of subsections (a) through (h) of this
4 section. If a person entitled to a lien under this section
5 does not properly file a notice of claim or properly notify
6 all holders of security interests of the lien within the
7 time required by this section, the person waives the right
8 to the lien.

10 29-8-104. Extent of lien; priority.

12 (a) The lien shall be to the extent of:

14 (i) The agreed price, if any, pursuant to the
15 terms of any contract or for the market value at the time
16 of delivery of the amount delivered if not agreed;

18 (ii) If the farm product has not been sold or
19 processed by the processor, contractor, warehouse operator
20 or commodity dealer the lien shall be on the farm product;

22 (iii) If the farm product is sold or processed
23 by the processor, contractor, warehouse operator or
24 commodity dealer the lien shall be on the cash proceeds

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1 from the sale. For purposes of this paragraph, cash
2 proceeds held by the processor, contractor, warehouse
3 operator or commodity dealer shall be deemed to be cash
4 proceeds from the sale regardless of whether it is
5 identifiable cash proceeds;

7 (iv) If the farm product is processed by the
8 processor, contractor, warehouse operator or commodity
9 dealer and there is no property of the type described in
10 paragraph (ii) or (iii) of this subsection to which the
11 lien can attach, then the lien shall extend to any property
12 of the processor, contractor, warehouse operator or
13 commodity dealer that may be subject to a security interest
14 as provided by W.S. 34.1-9-102.

16 (b) A perfected lien under paragraph (a)(ii) or (iii)
17 of this section shall be preferred to, and have priority
18 over, a lien or security interest in favor of a creditor of
19 the processor, contractor, warehouse operator or commodity
20 dealer regardless of the time when the creditor's lien or
21 security interest attached to the farm products or the
22 proceeds thereof or therefrom. The priority of a perfected
23 lien under paragraph (a)(iv) of this section shall be
24 determined by the date on which the lien is filed as

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1 required by this act, and it shall not have priority over
2 other perfected liens on the same property which have been
3 perfected prior to the filing date.

5 29-8-105. Duration.

7 (a) A perfected lien created by this act remains in
8 effect until either the lienholder receives the full amount
9 due it for the farm products, including reasonable costs
10 and attorneys' fees incurred in enforcing the lien, or for
11 a period of one hundred eighty (180) days from the date the
12 lien becomes perfected as provided in this act.

14 (b) All actions to foreclose or enforce a lien under
15 this chapter shall be commenced within one hundred eighty
16 (180) days after the filing of the lien statement. No lien
17 shall continue to exist except by virtue of the provisions
18 of this chapter for more than one hundred eighty (180) days
19 after the lien is filed unless an action to foreclose the
20 lien is instituted.

22 29-8-106. Waivers unenforceable.

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1 Any provision of a contract which waives a producer's right
2 or an obligation of a party established by this act is void
3 and unenforceable. This section does not affect other
4 provisions of the contract or related document, policy or
5 agreement which can be given effect without the voided
6 provision.

8 29-8-107. Choice of law.

10 Any condition, stipulation or provision requiring the
11 application of the law of another state in lieu of this act
12 is void and unenforceable.

14 29-8-108. Damages, fees, costs and injunctive relief.

16 (a) A producer who suffers damages because of a
17 violation of this act may obtain appropriate legal and
18 equitable relief, including damages, as a suit in common
19 law pursuant to the Wyoming Rules of Civil Procedure.

21 (b) In any action by a producer to enforce a
22 perfected lien created by this act, the court shall award
23 the producer who is the prevailing party reasonable
24 attorneys' fees and other litigation costs and expenses.

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1 The payment of any such award shall be secured in the same
2 manner as a lien created and perfected under this act.

4 (c) In order to obtain injunctive relief, a producer
5 is not required to post a bond, prove the absence of an
6 adequate remedy at law, or show the existence of special
7 circumstances, unless the court for good cause otherwise
8 orders. The court may order any form of prohibitory or
9 mandatory relief that is appropriate under principles of
10 equity, including but not limited to, issuing a temporary
11 or permanent restraining order.

13 29-8-109. Applicability of act.

15 This act applies to contracts executed, entered into,
16 renewed or substantively amended on or after July 1, 2001.

18 Section 2. W.S. 29-1-305(c), 29-5-104, 29-7-106(b)
19 and 29-7-203 are amended to read:

21 29-1-305. Priority of liens.

23 (c) Any lien, security interest or mortgage which has
24 been perfected upon real or personal property or upon a

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1 leasehold interest prior to the commencement of any
2 construction work or repair of the premises or property
3 except as provided by chapter 7 of this title or W.S.
4 29-8-102 relating to liens for the production of farm
5 products under contracts executed, entered into, renewed or
6 substantively amended on or after July 1, 2001, shall have
7 priority.

9 29-5-104. Priority of lien.

11 The lien for work performed as specified in W.S. 29-5-102
12 has precedence over any mortgage or encumbrance except
13 those created by W.S. 29-8-102 relating to liens for the
14 production of farm products under contracts executed,
15 entered into, renewed or substantively amended after July
16 1, 2001.

18 29-7-106. Priority of lien.

20 (b) If the property is not in possession of the lien
21 claimant, a lien under W.S. 29-7-101 through 29-7-106 shall
22 be prior to all other liens, encumbrances and security
23 interests, except for a subsequent lien claimant in
24 possession under W.S. 29-7-101 through 29-7-106 or a lien

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1 created under W.S. 29-8-102 relating to liens for the
2 production of farm products under contracts executed,
3 entered into, renewed or substantively amended after July
4 1, 2001.

6 29-7-203. Priority of liens.

8 The lien herein given is prior to and shall take precedence
9 over any lien or encumbrance given subsequent to the
10 service unless the lien is created pursuant to W.S.
11 29-8-102 relating to liens for the production of farm
12 products under contracts executed, entered into, renewed or
13 substantively amended after July 1, 2001.

15 Section 3. This act is effective July 1, 2001.

17 (END)

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