1-1 By: Swinford (Senate Sponsor - Shelley) H.B. No. 2501 1-2 (In the Senate - Received from the House May 13, 1993; 1-3 May 14, 1993, read first time and referred to Committee on Natural 1-4 Resources; May 20, 1993, reported favorably, as amended, by the 1-5 following vote: Yeas 9, Nays 0; May 20, 1993, sent to printer.) 1-6 COMMITTEE VOTE 1-7 Yea Nay PNV Absent 1-8 Sims x 1-9 Truan x 1-10 Armbrister x 1-11 Barrientos x 1-12 Bivins x 1-13 Brown x 1-14 Carriker x 1-15 Lucio x 1-16 Montford x 1-17 Ratliff x 1-18 Shelley x 1-19 COMMITTEE AMENDMENT NO. 1 By: Shelley 1-20 Amend H.B. 2501 as follows: 1-21 (1) Amend Page 2, line 70 by striking subsection (3) and 1-22 inserting the following new subsection: 1-23 (3) "Public Warehouseman" means a person who stores personal 1-24 property that is not an agricultural commodity for hire and issues 1-25 a negotiable warehouse receipt for such property. 1-26 COMMITTEE AMENDMENT NO. 2 By: Shelley 1-27 Amend H.B. 2501 as follows: 1-28 (1) Amend Page 3, line 32 by striking subsections (a) and 1-29 (b) and inserting the following new subsections: 1-30 (a) The owner or depositor of property stored in a public 1-31 warehouse may request from the public warehouseman a negotiable 1-32 receipt for the property stored in the warehouse. 1-33 (b) The receipt shall be signed by the public warehouseman 1-34 or the warehouseman's agent and state the information required by 1-35 Section 7.202 of the Uniform Commercial Code. 1-36 COMMITTEE AMENDMENT NO. 3 By: Shelley 1-37 Amend H.B. 2501 as follows: 1-38 (1) Amend Page 3, line 43 by striking subsection (c) and 1-39 inserting the following new subsection: 1-40 (c) This article does not apply to public warehouses owned, 1-41 controlled, operated, or leased by motor carriers licensed by and 1-42 within the jurisdiction of the Railroad Commission of Texas under 1-43 the provisions of Article 911b, Vernon's Texas Civil Statutes, or 1-44 their agents. 1-45 A BILL TO BE ENTITLED 1-46 AN ACT 1-47 relating to the regulation of warehouses and certain cotton buyers. 1-48 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-49 SECTION 1. Section 14.003, Agriculture Code, is amended by 1-50 adding Subsection (d) to read as follows: 1-51 (d) The following information prepared by the department in 1-52 the course of its regulatory authority under this subchapter or 1-53 required to be submitted to the department in accordance with the 1-54 department's administration of this subchapter is confidential and 1-55 not subject to public disclosure: 1-56 (1) inspection reports containing information 1-57 regarding grain inventory; and 1-58 (2) financial information provided to the department 1-59 to establish net worth for purposes of licensure. 1-60 SECTION 2. Subchapter A, Chapter 14, Agriculture Code, is 1-61 amended by adding Section 14.0091 to read as follows: 1-62 Sec. 14.0091. OBLIGATIONS OF WAREHOUSEMAN. The obligations 1-63 of a warehouseman include the obligation to: 1-64 (1) deliver a commodity to a person holding a receipt 1-65 for a commodity stored in the warehouse; and 1-66 (2) maintain the quantity and quality of a commodity 1-67 as evidenced by and indicated on a warehouse receipt. 1-68 SECTION 3. The heading of Section 14.010, Agriculture Code, 2-1 is amended to read as follows: 2-2 Sec. 14.010. RECOVERY ON BOND; LIABILITY OF WAREHOUSEMAN. 2-3 SECTION 4. Section 14.010, Agriculture Code, is amended by 2-4 adding Subsection (c) to read as follows: 2-5 (c) A warehouseman is liable for damages for loss of or 2-6 injury to a commodity caused by the warehouseman's failure to 2-7 exercise the care that a reasonably prudent person would exercise 2-8 in regard to the commodity under similar circumstances, but, unless 2-9 otherwise agreed, a warehouseman is not liable for damages to a 2-10 commodity that could not have been avoided through the exercise of 2-11 that care. 2-12 SECTION 5. Section 14.017, Agriculture Code, is amended by 2-13 adding Subsection (f) to read as follows: 2-14 (f) Unless previously canceled in accordance with the 2-15 provisions of Chapter 7, Business & Commerce Code, a Texas 2-16 commodity warehouse receipt issued under this chapter expires 10 2-17 years after the date of issuance. 2-18 SECTION 6. Subchapter A, Chapter 14, Agriculture Code, is 2-19 amended by adding Section 14.0261 to read as follows: 2-20 Sec. 14.0261. WAREHOUSE RECEIPT AS PRIMA FACIE EVIDENCE. In 2-21 an action involving a warehouseman that is brought under this 2-22 subchapter, a warehouse receipt constitutes prima facie evidence of 2-23 the truth of the facts stated in the receipt. 2-24 SECTION 7. Subchapter A, Chapter 14, Agriculture Code, is 2-25 amended by adding Section 14.0262 to read as follows: 2-26 Sec. 14.0262. RECOVERY OF COURT COSTS. (a) On prevailing 2-27 in an action commenced by the department through the attorney 2-28 general under this subchapter, the department and the attorney 2-29 general are each entitled to recover: 2-30 (1) investigation costs and fees; 2-31 (2) reasonable attorney's fees; 2-32 (3) court costs; and 2-33 (4) other costs relating to the action, including the 2-34 cost of depositions and other forms of discovery and copying 2-35 charges. 2-36 (b) The costs recoverable under this section are in addition 2-37 to other relief available to the department or attorney general. 2-38 SECTION 8. Subchapter A, Chapter 14, Agriculture Code, is 2-39 amended by adding Section 14.036 to read as follows: 2-40 Sec. 14.036. POSTING OF STORAGE RATES OR TARIFFS. (a) A 2-41 public commodity warehouse licensed under this subchapter shall 2-42 post a copy of the storage rates and tariffs charged by the 2-43 warehouse at the main warehouse office and at each warehouse 2-44 operating under the license. The public warehouse shall post any 2-45 change to the posted rates or tariffs not later than the 14th day 2-46 before the day on which the change is to take effect. 2-47 (b) Department inspectors shall check compliance with this 2-48 section during inspections of a public commodity warehouse under 2-49 this subchapter. 2-50 SECTION 9. Title 132A, Revised Statutes, is amended by 2-51 adding Article 9103 to read as follows: 2-52 Art. 9103. NONAGRICULTURAL PUBLIC WAREHOUSES 2-53 Sec. 1. DEFINITIONS. In this article: 2-54 (1) "Department" means the Texas Department of 2-55 Licensing and Regulation. 2-56 (2) "Public warehouse" means a house, building, or 2-57 room in which personal property that is not an agricultural 2-58 commodity is stored and protected by a public warehouseman from 2-59 damage by the elements. "Public warehouse" does not include a 2-60 self-service storage facility as defined in Chapter 59, Property 2-61 Code. 2-62 (3) "Public warehouseman" means a person who stores 2-63 personal property that is not an agricultural commodity for hire. 2-64 (4) "Agricultural commodity" means wheat, grain 2-65 sorghum, corn, oats, barley, rye, soybeans, cotton, rice, peas, 2-66 beans, or any other agricultural product customarily stored in a 2-67 public warehouse. 2-68 Sec. 2. WAREHOUSE REGULATION. A public warehouse operating 2-69 under this article is under the supervision of the department. 2-70 Sec. 3. CERTIFICATE TO TRANSACT BUSINESS. No person may 3-1 operate a public warehouse without first obtaining a certificate to 3-2 transact business as a public warehouseman from the department. 3-3 Sec. 4. APPLICATION FOR CERTIFICATE. (a) To obtain a 3-4 certificate to transact business under this article, a person must 3-5 apply in writing to the department on a form prescribed by the 3-6 department. The application must state the name and location of 3-7 the public warehouse and: 3-8 (1) the name of each person with an interest as owner 3-9 or principal in the public warehouse; or 3-10 (2) the name of the president, secretary, and 3-11 treasurer of the corporation if a corporation owns or manages the 3-12 public warehouse. 3-13 (b) The department shall issue the certificate and retain 3-14 for department records a copy of the application. 3-15 Sec. 5. BOND. (a) A person receiving a certificate to 3-16 transact business shall file a bond with the department. 3-17 (b) The bond must be: 3-18 (1) payable to the state; 3-19 (2) of good and sufficient surety; 3-20 (3) conditioned on faithful performance of the 3-21 applicant's duty as a public warehouseman; and 3-22 (4) in the amount of $5,000. 3-23 (c) A bond is subject to approval by the department. 3-24 Sec. 6. RECEIPTS. (a) The owner or depositor of property 3-25 stored in a public warehouse may request from the public 3-26 warehouseman a receipt for the property stored in the warehouse. 3-27 (b) The receipt shall be signed by the public warehouseman 3-28 or the warehouseman's agent and state: 3-29 (1) that the receipt is issued by a public warehouse; 3-30 (2) the date of its issuance; 3-31 (3) the name and location of the public warehouse in 3-32 which the property is stored; and 3-33 (4) the description, quantity, number, and marks of 3-34 the property stored. 3-35 (c) The public warehouseman shall number receipts 3-36 consecutively in the order of their issue and shall keep a correct 3-37 record of receipts issued that is available for public inspection 3-38 at reasonable hours. 3-39 Sec. 7. DUPLICATE RECEIPTS. (a) A public warehouseman may 3-40 not issue a duplicate receipt or two receipts bearing the same 3-41 number from the same public warehouse during the same calendar 3-42 year, except as provided by Subsection (b) of this section. 3-43 (b) If a receipt is lost or destroyed, the public 3-44 warehouseman shall issue a new receipt that: 3-45 (1) bears the same date and number as the original 3-46 receipt; 3-47 (2) is plainly marked "duplicate" on its face; and 3-48 (3) is secured with a deposit: 3-49 (A) made by the person requesting the duplicate 3-50 receipt; and 3-51 (B) acceptable to the warehouseman to protect a 3-52 person who may hold the original receipt in good faith and for 3-53 valuable consideration. 3-54 Sec. 8. RECEIPT TO BE ISSUED ONLY ON DELIVERY. A public 3-55 warehouseman may not issue a receipt until the goods secured by the 3-56 receipt are actually delivered to the public warehouse and are 3-57 under the control of the public warehouseman issuing the receipt. 3-58 Sec. 9. DELIVERY. (a) A public warehouseman shall 3-59 immediately deliver property held in the warehouse on: 3-60 (1) presentation of a properly endorsed receipt issued 3-61 by the warehouseman to represent the property; and 3-62 (2) payment by the holder of the receipt of all proper 3-63 warehouse charges on property represented by the receipt. 3-64 (b) Unless a receipt has been lost or canceled, a public 3-65 warehouseman may not deliver property represented by a receipt 3-66 until the receipt is surrendered and canceled. 3-67 (c) On delivery of goods represented by a receipt, the 3-68 public warehouseman shall cancel the receipt by writing "canceled" 3-69 in ink on the receipt and placing the warehouseman's name on the 3-70 face of the receipt. A canceled receipt is void and may not be 4-1 circulated. 4-2 (d) A public warehouseman who fails to strictly comply with 4-3 this section is liable to the legal holder of the receipt for the 4-4 full value at the time of the default of the property represented 4-5 by the receipt. 4-6 Sec. 10. EXCEPTIONS. (a) This article does not apply to 4-7 private warehouses or the issuance of receipts by the owners or 4-8 managers of private warehouses. 4-9 (b) This article does not prohibit a public warehouseman 4-10 from issuing the same type of receipt issued by a private 4-11 warehouse, provided that the face of the receipt is plainly 4-12 marked: "Not a public warehouse receipt." 4-13 Sec. 11. STORAGE CHARGES. (a) The department may set 4-14 minimum storage charges for a public warehouse operating under this 4-15 article. 4-16 (b) The department is not required to set equal charges at 4-17 all places or all times and may take into consideration the local 4-18 conditions and volume of business of each public warehouse. 4-19 Sec. 12. REVOCATION OF CERTIFICATE. After a hearing the 4-20 commissioner may deny, suspend, or revoke a certificate to transact 4-21 business and may impose administrative sanctions and penalties and 4-22 seek injunctive relief and civil penalties against a public 4-23 warehouseman as provided by Article 9100, Revised Statutes. 4-24 SECTION 10. Chapter 113, Agriculture Code, is repealed. 4-25 SECTION 11. This Act takes effect September 1, 1993. 4-26 SECTION 12. The importance of this legislation and the 4-27 crowded condition of the calendars in both houses create an 4-28 emergency and an imperative public necessity that the 4-29 constitutional rule requiring bills to be read on three several 4-30 days in each house be suspended, and this rule is hereby suspended. 4-31 * * * * * 4-32 Austin, 4-33 Texas 4-34 May 20, 1993 4-35 Hon. Bob Bullock 4-36 President of the Senate 4-37 Sir: 4-38 We, your Committee on Natural Resources to which was referred H.B. 4-39 No. 2501, have had the same under consideration, and I am 4-40 instructed to report it back to the Senate with the recommendation 4-41 that it do pass, as amended, and be printed. 4-42 Sims, 4-43 Chairman 4-44 * * * * * 4-45 WITNESSES 4-46 FOR AGAINST ON 4-47 ___________________________________________________________________ 4-48 Name: Bob Tarrant x 4-49 Representing: Tx Dept. of Agriculture 4-50 City: Giddings 4-51 ------------------------------------------------------------------- 4-52 Name: Bob Vetters 4-53 Representing: Assn. of Texas Warehousemen 4-54 City: San Antonio 4-55 ------------------------------------------------------------------- 4-56 Name: John Sneed x 4-57 Representing: Tx Dept. of Agriculture 4-58 City: Austin 4-59 -------------------------------------------------------------------