74R8524 JRD-D By Swinford H.B. No. 1463 Substitute the following for H.B. No. 1463: By Cuellar of Hidalgo C.S.H.B. No. 1463 A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to a lien in favor of a seller of agricultural chemicals, 1-3 agricultural seeds, or animal feed or of a provider of labor in 1-4 connection with the agricultural chemicals or agricultural seeds; 1-5 providing penalties. 1-6 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-7 SECTION 1. Title 5, Agriculture Code, is amended by adding 1-8 Subtitle H to read as follows: 1-9 SUBTITLE H. HORTICULTURAL LIENS 1-10 CHAPTER 128. AGRICULTURAL CHEMICAL AND SEED LIENS 1-11 SUBCHAPTER A. GENERAL PROVISIONS 1-12 Sec. 128.001. DEFINITIONS. In this chapter: 1-13 (1) "Agricultural chemical" includes fertilizer 1-14 material as defined under Section 63.001, pesticides as defined 1-15 under Section 76.001, plant regulators as defined under Section 1-16 76.001, lime, plant and soil amendments, plant food, herbicides, 1-17 and chemical compounds that are applied to crops or to land used 1-18 for growing crops. 1-19 (2) "Agricultural seed" has the meaning assigned under 1-20 Section 61.001. 1-21 (3) "Labor" means labor or services performed in the 1-22 application, delivery, or preparation of an agricultural chemical 1-23 or agricultural seed. 1-24 (4) "Reasonable or agreed charges" means: 2-1 (A) any agreed price for agricultural chemicals, 2-2 agricultural seeds, or labor sold or provided to a lien debtor at 2-3 the lien debtor's request; or 2-4 (B) the reasonable value of agricultural 2-5 chemicals, agricultural seeds, or labor, as of the date of 2-6 application, delivery, or preparation, if there is not an agreed 2-7 price or an agreed method for determining price. 2-8 Sec. 128.002. PROCEEDS. (a) For the purposes of this 2-9 chapter, proceeds are the amounts received by a lien debtor, before 2-10 a deduction for taxes, fees, or assessments or a deduction made 2-11 under a court order, from the sale of: 2-12 (1) the crop that existed at the time of application 2-13 on the land of the agricultural chemical sold by the lien claimant 2-14 or applied, delivered, or prepared by the lien claimant; 2-15 (2) the first crop produced on the land after the 2-16 agricultural chemical sold by the lien claimant or applied, 2-17 delivered, or prepared by the lien claimant was applied, if crops 2-18 did not exist on the land at the time the agricultural chemical was 2-19 applied; or 2-20 (3) the crop produced from the agricultural seed 2-21 supplied by the lien claimant or applied, delivered, or prepared by 2-22 the lien claimant. 2-23 (b) For the purposes of this chapter, the following are not 2-24 included as proceeds: 2-25 (1) amounts due or owing to a cooperative association 2-26 under Chapter 51 or 52; or 2-27 (2) amounts retained by a cooperative association 3-1 under Chapter 51 or 52. 3-2 (Sections 128.003-128.005 reserved for expansion 3-3 SUBCHAPTER B. AGRICULTURAL CHEMICAL AND SEED LIEN 3-4 Sec. 128.006. NOTICE BEFORE PURCHASE; REQUIRED NOTICE BEFORE 3-5 CLAIMING LIEN. (a) A person claiming a lien under this chapter 3-6 must have provided notice of the provisions of this chapter, before 3-7 purchase, either generally to purchasers of agricultural chemicals, 3-8 agricultural seeds, or labor as part of the lien claimant's normal 3-9 business practices or specifically to the lien debtor. Notice 3-10 provided under this subsection must read, to the extent applicable, 3-11 substantially as follows: "The sale of agricultural chemicals or 3-12 agricultural seed on credit and the provision of labor related to 3-13 agricultural chemicals or agricultural seed is subject to Chapter 3-14 128, Agriculture Code. Failure to pay the agreed or reasonable 3-15 charges for the chemicals, seed, or labor may result in the 3-16 attachment of a lien to the proceeds of the agricultural products 3-17 produced with the aid of the chemicals, seed, or labor." A 3-18 potential lien claimant may satisfy the requirements of this 3-19 subsection: 3-20 (1) by printing or stamping the notice on credit 3-21 applications filled out by purchasers; and 3-22 (2) for future purchases by purchasers who are not 3-23 notified on the credit application, by printing or stamping the 3-24 notice on an invoice or on a statement sent by separate cover. 3-25 (b) Before a person may claim a lien under this chapter, the 3-26 person must send to the debtor by certified mail written notice 3-27 that states: 4-1 (1) that the payment of the reasonable or agreed 4-2 charges is more than 30 days overdue; 4-3 (2) the amount that is overdue; 4-4 (3) that the debtor has the following three 4-5 alternatives: 4-6 (A) to allow the lien to be filed; 4-7 (B) to enter into an agreement granting a 4-8 security interest in the proceeds described by Section 128.002 4-9 under the Business & Commerce Code; or 4-10 (C) to pay the reasonable or agreed charges; and 4-11 (4) in at least 10-point type, that: 4-12 (A) the debtor has until the 10th day after the 4-13 date on which the notice is received to select an alternative under 4-14 Subdivision (3), notify the claimant of the alternative selected, 4-15 and satisfy all the requirements of the selected alternative; and 4-16 (B) the claimant may file the notice of claim of 4-17 lien at any time after the 10th day after the date on which the 4-18 debtor receives the notice if the debtor does not comply with the 4-19 requirements of Paragraph (A). 4-20 Sec. 128.007. ATTACHMENT OF LIEN. A lien established under 4-21 this chapter attaches to the proceeds described by Section 4-22 128.002. 4-23 Sec. 128.008. AMOUNT OF LIEN. The amount of a lien under 4-24 this chapter is equal to the sum of: 4-25 (1) the amount of the unpaid reasonable or agreed 4-26 charges for: 4-27 (A) agricultural chemicals, labor, or both, as 5-1 appropriate, furnished within the 60-day period ending on the day 5-2 the lien attaches; and 5-3 (B) agricultural seeds, labor, or both, as 5-4 appropriate, furnished within the 45-day period ending on the day 5-5 the lien attaches; and 5-6 (2) the filing fees for the lien as provided by this 5-7 chapter. 5-8 Sec. 128.009. PERSON ENTITLED TO FILE; EXCEPTION. (a) 5-9 Except as provided by Subsection (b) or by Section 128.047, a 5-10 person who provides an agricultural chemical, agricultural seed, or 5-11 labor may file a notice of claim of lien as provided by this 5-12 chapter. 5-13 (b) A claimant may not file a notice of claim of lien if the 5-14 arbitration of a dispute between the claimant and the debtor is 5-15 pending or has not been resolved under Chapter 64. A claimant may 5-16 not file a notice of claim of lien if the settlement of a dispute 5-17 between the claimant and the debtor is pending or has not been 5-18 resolved under Section 128.012. 5-19 Sec. 128.010. PERFECTION OF LIEN. A lien created under this 5-20 chapter is perfected on the filing of a notice of claim of lien 5-21 with the secretary of state as provided by this chapter. 5-22 Sec. 128.011. DURATION OF NOTICE OF CLAIM OF LIEN. (a) 5-23 Except as otherwise provided by this chapter, the notice of claim 5-24 of lien is effective, and a new notice of claim of lien is not 5-25 required to maintain the lien, as long as the person who provides 5-26 the agricultural chemical, agricultural seed, or labor either: 5-27 (1) remains unpaid for the amount secured by the lien; 6-1 or 6-2 (2) continues to provide an agricultural chemical, 6-3 agricultural seed, or labor on a regular basis to the lien debtor. 6-4 (b) For purposes of this section, providing an agricultural 6-5 chemical, agricultural seed, or labor is not considered to be made 6-6 on a regular basis if a period of more than 45 days elapses between 6-7 applications, deliveries, or preparations. 6-8 Sec. 128.012. PROCEDURES FOR SETTLEMENT OF DISPUTES. (a) 6-9 The commissioner of agriculture by rule shall establish a procedure 6-10 to settle a dispute between a claimant supplying agricultural 6-11 chemicals or labor in the application, delivery, or preparation of 6-12 agricultural chemicals and a debtor. The procedures must provide: 6-13 (1) a time requirement for submitting the dispute to 6-14 the department; 6-15 (2) a time requirement within which a notice of the 6-16 dispute must be submitted to each party; and 6-17 (3) a process for evaluating the dispute. 6-18 (b) Each party to the dispute is equally liable for the 6-19 reasonable costs incurred by the department in carrying out this 6-20 section. 6-21 Sec. 128.013. CONTENTS OF NOTICE OF CLAIM OF LIEN. The 6-22 notice of claim of lien must include: 6-23 (1) the name and address of the lien claimant; 6-24 (2) the name and address of the lien debtor; 6-25 (3) the location of the property to which the 6-26 agricultural chemical, agricultural seed, or labor was provided; 6-27 (4) a statement that the payment of the reasonable or 7-1 agreed charges is more than 30 days overdue; 7-2 (5) the amount that is overdue; 7-3 (6) a statement, signed under penalty of perjury, 7-4 that: 7-5 (A) the lien claimant provided notice of the 7-6 provisions of this chapter, before purchase, either generally to 7-7 purchasers of agricultural chemicals, agricultural seeds, or labor 7-8 as part of the lien claimant's normal business practices or 7-9 specifically to the lien debtor, in the manner required by Section 7-10 128.006(a); 7-11 (B) the lien claimant sent to the lien debtor 7-12 the notice required by Section 128.006(b); 7-13 (C) more than 10 days have elapsed since the 7-14 date on which the notice was received by the lien debtor; and 7-15 (D) the lien debtor has not complied with the 7-16 requirements of an alternative set out by Section 128.006(b); and 7-17 (7) a statement that the lien claimant has an 7-18 agricultural chemical or agricultural seed lien under this chapter. 7-19 Sec. 128.014. SIGNATURE. The notice of claim of lien shall 7-20 be signed by the lien claimant or by a person authorized to sign 7-21 documents of a similar kind on behalf of the claimant. 7-22 Sec. 128.015. FORM. (a) The notice of claim of lien must 7-23 be filed on a form that satisfies the requirements of a financing 7-24 statement under Section 9.402, Business & Commerce Code, except 7-25 that: 7-26 (1) the lien claimant may be identified either as a 7-27 lien claimant or as a secured party; 8-1 (2) the form must be signed by the lien claimant and 8-2 is not required to be signed by the lien debtor; and 8-3 (3) in the space for the description of the 8-4 collateral, the information specified in Sections 128.013(3), (4), 8-5 (5), and (7) must be entered. 8-6 (b) A separately signed statement containing the information 8-7 specified in Section 128.013(6) shall be attached to the form 8-8 required under Subsection (a). 8-9 Sec. 128.016. FILING AND MARKING IN OFFICE OF SECRETARY OF 8-10 STATE; FEE. (a) The notice of claim of lien shall be filed and 8-11 marked in the office of the secretary of state in the same manner 8-12 as a financing statement is filed and marked under Section 9.403, 8-13 Business & Commerce Code. 8-14 (b) The uniform fee for filing and indexing and for stamping 8-15 a copy furnished by the secured party is the same as the fee 8-16 assessed under Section 9.403, Business & Commerce Code. 8-17 Sec. 128.017. TIME OF WRITTEN NOTICE. The lien claimant 8-18 shall provide written notice of the claim of lien to the lien 8-19 debtor not later than the 10th day after the date the notice of 8-20 claim of lien is filed with the office of the secretary of state. 8-21 Sec. 128.018. RECOGNITION OF NOTICE AS FINANCING STATEMENT. 8-22 The secretary of state shall recognize a notice of claim of lien 8-23 under this subchapter as a financing statement under Section 9.402, 8-24 Business & Commerce Code. 8-25 (Sections 128.019-128.025 reserved for expansion 8-26 SUBCHAPTER C. PRIORITY OF LIEN 8-27 Sec. 128.026. TIME OF FILING. (a) A lien created under 9-1 this chapter has the same priority as a security interest perfected 9-2 by the filing of a financing statement on the date the notice of 9-3 claim of lien was filed. 9-4 (b) A lien created under this chapter does not have priority 9-5 over labor claims for wages and salaries for personal services that 9-6 are provided by an employee to a lien debtor in connection with the 9-7 production of agricultural products, the proceeds of which are 9-8 subject to the lien. 9-9 (Sections 128.027-128.030 reserved for expansion 9-10 SUBCHAPTER D. INFORMATION CONCERNING LIEN 9-11 Sec. 128.031. ISSUANCE OF CERTIFICATE TO MEMBER OF PUBLIC; 9-12 FEE. (a) A person may obtain a certificate identifying any lien 9-13 on file and any notice of claim of lien naming a particular debtor 9-14 and stating the date and time of filing of each notice and the 9-15 names and addresses of each lienholder in the certificate. 9-16 (b) The fee for a certificate under Subsection (a) shall be 9-17 established by the secretary of state in an amount necessary to 9-18 cover the cost of administering this section. 9-19 Sec. 128.032. COPIES OF NOTICES OF CLAIM OF LIEN AND OTHER 9-20 NOTICES; FEE. (a) A person may obtain a copy of any notice of 9-21 claim of an agricultural chemical or seed lien filed. 9-22 (b) The fee for a copy of a notice of claim of lien obtained 9-23 under Subsection (a) shall be established by the secretary of 9-24 state in an amount necessary to cover the cost of administering 9-25 this section. 9-26 (Sections 128.033-128.035 reserved for expansion 9-27 SUBCHAPTER E. ENFORCEMENT OF LIEN 10-1 Sec. 128.036. WRITTEN NOTICE TO SECURED CREDITORS BY LIEN 10-2 CLAIMANT. (a) A lien claimant shall provide written notice to any 10-3 secured creditor at least 30 days before the date the lien claimant 10-4 enforces a claim of lien. 10-5 (b) For purposes of this section, "secured creditor" means 10-6 any entity named as a secured party in a financing statement that 10-7 is filed regarding the debtor and that covers: 10-8 (1) a farm product, an account, or a crop subject to 10-9 the lien; 10-10 (2) a crop growing or grown on the land on which the 10-11 agricultural chemical was applied or for which the agricultural 10-12 seed was supplied; or 10-13 (3) the next crop to be grown on that land, if a crop 10-14 is not planted. 10-15 Sec. 128.037. FORECLOSURE IN ACTION TO RECOVER REASONABLE OR 10-16 AGREED CHARGES. The lien claimant may foreclose on a lien under 10-17 this chapter only in an action to recover the reasonable or agreed 10-18 charges. 10-19 Sec. 128.038. TERMINATION STATEMENT. (a) If a lien 10-20 claimant receives payment for the total amount secured by a lien 10-21 under this chapter and the lien claimant has not furnished an 10-22 agricultural chemical, agricultural seed, or labor during the 10-23 45-day period before the date on which payment is received, the 10-24 lien claimant shall file a termination statement with the secretary 10-25 of state and shall send the lien debtor a copy of the statement as 10-26 provided by this section. The statement shall state that the lien 10-27 claimant no longer claims a security interest under the notice of 11-1 claim of lien. 11-2 (b) The notice of claim of lien must be identified in the 11-3 statement under Subsection (a) by the date, names of parties to the 11-4 agreement, and file number of the original lien. 11-5 (c) If the lien claimant does not send the termination 11-6 statement required by this section before the 11th day after the 11-7 date on which the lien claimant received payment, the lien claimant 11-8 is liable to the lien debtor for actual damages suffered by the 11-9 lien debtor as a result of the failure. If the lien claimant acts 11-10 in bad faith in failing to send the statement, the lien claimant is 11-11 liable for an additional penalty of $100. 11-12 (d) The filing officer in the secretary of state's office 11-13 shall mark each termination statement with the date and time of 11-14 filing and shall index the statement under the name of the lien 11-15 debtor and under the file number of the original lien. If the 11-16 filing officer has a microfilm or other photographic record of the 11-17 lien and related filings, the filing officer may destroy the filed 11-18 notice of claim of lien at any time after receiving the termination 11-19 statement. If the filing officer does not have a photographic 11-20 record, the filing officer may destroy the filed notice of claim of 11-21 lien at any time after the first anniversary of the date on which 11-22 the filing officer received the termination statement. 11-23 (e) The uniform filing fee for filing and indexing the 11-24 termination statement is the same as the fee assessed under Section 11-25 9.404(c), Business & Commerce Code. 11-26 Sec. 128.039. RIGHT OF ASSIGNMENT OR TRANSFER; FILING OF 11-27 STATEMENT. (a) A lien created under this chapter may be assigned 12-1 by the holder of the lien, with full rights of enforcement. 12-2 (b) The lienholder shall file a statement of assignment with 12-3 the secretary of state as provided by Section 9.405, Business & 12-4 Commerce Code. 12-5 (Sections 128.040-128.045 reserved for expansion 12-6 SUBCHAPTER F. MISCELLANEOUS 12-7 Sec. 128.046. RULES. The secretary of state may adopt rules 12-8 necessary to carry out the secretary's duties under this chapter, 12-9 including prescribing necessary forms. 12-10 Sec. 128.047. MAXIMUM NUMBER OF LIENS. Not more than four 12-11 liens may be enforced under this chapter against the same proceeds 12-12 of a lien debtor even if the liens are filed by different lien 12-13 claimants. 12-14 Sec. 128.048. APPLICABILITY OF OTHER LAW. Chapter 9, 12-15 Business & Commerce Code, applies to a lien created under this 12-16 chapter to the extent Chapter 9 is consistent with this chapter. 12-17 SECTION 2. Title 6, Agriculture Code, is amended by adding 12-18 Subtitle E to read as follows: 12-19 SUBTITLE E. LIENS ON ANIMAL PRODUCTS 12-20 CHAPTER 188. LIENS FOR ANIMAL FEED 12-21 SUBCHAPTER A. GENERAL PROVISIONS 12-22 Sec. 188.001. DEFINITIONS. In this chapter: 12-23 (1) "Animal feed" includes: 12-24 (A) commercial feed as described by Section 12-25 141.002(a), including a substance listed by Section 141.002(c) if 12-26 used as a feed for animals; or 12-27 (B) customer-formula feed as defined under 13-1 Section 141.001. 13-2 (2) "Labor" means labor or services performed in the 13-3 delivery or preparation of animal feed provided by the seller of 13-4 the animal feed. 13-5 (3) "Livestock" means beef cattle, dairy cattle, 13-6 sheep, goats, hogs, horses, poultry, and ratites. 13-7 (4) "Reasonable or agreed charges" means: 13-8 (A) any agreed price for animal feed, including 13-9 labor, sold to a lien debtor at the lien debtor's request; or 13-10 (B) the reasonable value of animal feed, 13-11 including labor, as of the date of delivery or preparation, if 13-12 there is not an agreed price or an agreed method for determining 13-13 price. 13-14 Sec. 188.002. PROCEEDS. (a) For the purposes of this 13-15 chapter, proceeds are the amounts received by a lien debtor, before 13-16 a deduction for taxes, fees, or assessments or a deduction made 13-17 under a court order, from the sale of: 13-18 (1) the livestock for which the animal feed was used; 13-19 (2) meat, milk, skins, wool, or other products derived 13-20 from that livestock; or 13-21 (3) issue born to that livestock. 13-22 (b) For the purposes of this chapter, proceeds do not 13-23 include amounts: 13-24 (1) due or owing to a cooperative association under 13-25 Chapter 51 or 52; or 13-26 (2) retained by a cooperative association under 13-27 Chapter 51 or 52. 14-1 (Sections 188.003-188.005 reserved for expansion 14-2 SUBCHAPTER B. ANIMAL FEED LIEN 14-3 Sec. 188.006. NOTICE BEFORE PURCHASE; REQUIRED NOTICE BEFORE 14-4 CLAIMING LIEN. (a) A person claiming a lien under this chapter 14-5 must have provided notice of the provisions of this chapter, before 14-6 purchase, either generally to purchasers of animal feed as part of 14-7 the lien claimant's normal business practices or specifically to 14-8 the lien debtor. Notice provided under this subsection must read, 14-9 to the extent applicable, substantially as follows: "The sale of 14-10 animal feed on credit is subject to Chapter 188, Agriculture Code. 14-11 Failure to pay the agreed or reasonable charges for the feed may 14-12 result in the attachment of a lien to the proceeds of the livestock 14-13 for which the feed is used or the proceeds of the animal products 14-14 produced from the livestock." A potential lien claimant may 14-15 satisfy the requirements of this subsection: 14-16 (1) by printing or stamping the notice on credit 14-17 applications filled out by purchasers; and 14-18 (2) for future purchases by purchasers who are not 14-19 notified on the credit application, by printing or stamping the 14-20 notice on an invoice or on a statement sent by separate cover. 14-21 (b) Before a person may claim a lien under this chapter, the 14-22 person must send to the debtor by certified mail written notice 14-23 that states: 14-24 (1) that the payment of the reasonable or agreed 14-25 charges is more than 30 days overdue; 14-26 (2) the amount that is overdue; 14-27 (3) that the debtor has the following three 15-1 alternatives: 15-2 (A) to allow the lien to be filed; 15-3 (B) to enter into an agreement granting a 15-4 security interest in the proceeds described by Section 188.002 15-5 under the Business & Commerce Code; or 15-6 (C) to pay the reasonable or agreed charges; and 15-7 (4) in at least 10-point type, that: 15-8 (A) the debtor has until the 10th day after the 15-9 date on which the notice is received to select an alternative under 15-10 Subdivision (3), notify the claimant of the alternative selected, 15-11 and satisfy all the requirements of the selected alternative; and 15-12 (B) the claimant may file the notice of claim of 15-13 lien at any time after the 10th day after the date on which the 15-14 debtor receives the notice if the debtor does not comply with the 15-15 requirements of Paragraph (A). 15-16 Sec. 188.007. ATTACHMENT OF LIEN. A lien established under 15-17 this chapter attaches to the proceeds described by Section 188.002. 15-18 Sec. 188.008. AMOUNT OF LIEN. The amount of a lien under 15-19 this chapter is equal to the sum of: 15-20 (1) the amount of the unpaid reasonable or agreed 15-21 charges for animal feed furnished within the 45-day period ending 15-22 on the day the lien attaches; and 15-23 (2) the filing fees for the lien as provided by this 15-24 chapter. 15-25 Sec. 188.009. PERSON ENTITLED TO FILE; EXCEPTION. (a) 15-26 Except as provided by Subsection (b) or by Section 188.047, a 15-27 person who provides animal feed may file a notice of claim of lien 16-1 as provided by this chapter. 16-2 (b) The claimant may not file a notice of claim of lien if 16-3 the settlement of a dispute between the claimant and the debtor is 16-4 pending or has not been resolved under Section 188.012. 16-5 Sec. 188.010. PERFECTION OF LIEN. A lien created under this 16-6 chapter is perfected on the filing of a notice of claim of lien 16-7 with the secretary of state as provided by this chapter. 16-8 Sec. 188.011. DURATION OF NOTICE OF CLAIM OF LIEN. (a) 16-9 Except as otherwise provided by this chapter, the notice of claim 16-10 of lien is effective, and a new notice of claim of lien is not 16-11 required to maintain the lien, as long as the person who provides 16-12 the animal feed, including labor, either: 16-13 (1) remains unpaid for the amount secured by the lien; 16-14 or 16-15 (2) continues to provide animal feed on a regular 16-16 basis to the lien debtor. 16-17 (b) For purposes of this section, providing animal feed, 16-18 including labor, is not considered to be made on a regular basis if 16-19 a period of more than 45 days elapses between deliveries or 16-20 preparations. 16-21 Sec. 188.012. PROCEDURES FOR SETTLEMENT OF DISPUTES. (a) 16-22 The commissioner of agriculture by rule shall establish a procedure 16-23 to settle a dispute between a claimant supplying animal feed and 16-24 labor and a debtor. The procedures must provide: 16-25 (1) a time requirement for submitting the dispute to 16-26 the department; 16-27 (2) a time requirement within which a notice of the 17-1 dispute must be submitted to each party; and 17-2 (3) a process for evaluating the dispute. 17-3 (b) Each party to the dispute is equally liable for the 17-4 reasonable costs incurred by the department in carrying out this 17-5 section. 17-6 Sec. 188.013. CONTENTS OF NOTICE OF CLAIM OF LIEN. The 17-7 notice of claim of lien must include: 17-8 (1) the name and address of the lien claimant; 17-9 (2) the name and address of the lien debtor; 17-10 (3) the location of the livestock for which the animal 17-11 feed was provided; 17-12 (4) a statement that the payment of the reasonable or 17-13 agreed charges is more than 30 days overdue; 17-14 (5) the amount that is overdue; 17-15 (6) a statement, signed under penalty of perjury, 17-16 that: 17-17 (A) the lien claimant provided notice of the 17-18 provisions of this chapter, before purchase, either generally to 17-19 purchasers of animal feed as part of the lien claimant's normal 17-20 business practices or specifically to the lien debtor, in the 17-21 manner required by Section 188.006(a); 17-22 (B) the lien claimant sent to the lien debtor 17-23 the notice required by Section 188.006(b); 17-24 (C) more than 10 days have elapsed since the 17-25 date on which the notice was received by the lien debtor; and 17-26 (D) the lien debtor has not complied with the 17-27 requirements of an alternative set out by Section 188.006(b); and 18-1 (7) a statement that the lien claimant has an animal 18-2 feed lien under this chapter. 18-3 Sec. 188.014. SIGNATURE. The notice of claim of lien shall 18-4 be signed by the lien claimant or by a person authorized to sign 18-5 documents of a similar kind on behalf of the claimant. 18-6 Sec. 188.015. FORM. (a) The notice of claim of lien must 18-7 be filed on a form that satisfies the requirements of a financing 18-8 statement under Section 9.402, Business & Commerce Code, except 18-9 that: 18-10 (1) the lien claimant may be identified either as a 18-11 lien claimant or as a secured party; 18-12 (2) the form must be signed by the lien claimant and 18-13 is not required to be signed by the lien debtor; and 18-14 (3) in the space for the description of the 18-15 collateral, the information specified in Sections 188.013(3), (4), 18-16 (5), and (7) must be entered. 18-17 (b) A separately signed statement containing the information 18-18 specified in Section 188.013(6) shall be attached to the form 18-19 required under Subsection (a). 18-20 Sec. 188.016. FILING AND MARKING IN OFFICE OF SECRETARY OF 18-21 STATE; FEE. (a) The notice of claim of lien shall be filed and 18-22 marked in the office of the secretary of state in the same manner 18-23 as a financing statement is filed and marked under Section 9.403, 18-24 Business & Commerce Code. 18-25 (b) The uniform fee for filing and indexing and for stamping 18-26 a copy furnished by the secured party is the same as the fee 18-27 assessed under Section 9.403, Business & Commerce Code. 19-1 Sec. 188.017. TIME OF WRITTEN NOTICE. The lien claimant 19-2 shall provide written notice of the claim of lien to the lien 19-3 debtor not later than the 10th day after the date the notice of 19-4 claim of lien is filed with the office of the secretary of state. 19-5 Sec. 188.018. RECOGNITION OF NOTICE AS FINANCING STATEMENT. 19-6 The secretary of state shall recognize a notice of claim of lien 19-7 under this subchapter as a financing statement under Section 9.402, 19-8 Business & Commerce Code. 19-9 (Sections 188.019-188.025 reserved for expansion 19-10 SUBCHAPTER C. PRIORITY OF LIEN 19-11 Sec. 188.026. TIME OF FILING. (a) A lien created under 19-12 this chapter has the same priority as a security interest perfected 19-13 by the filing of a financing statement on the date the notice of 19-14 claim of lien was filed. 19-15 (b) A lien created under this chapter does not have priority 19-16 over: 19-17 (1) labor claims for wages and salaries for personal 19-18 services that are provided by an employee to a lien debtor in 19-19 connection with the livestock, the production of animal products 19-20 derived from the livestock, or issue born to the livestock, the 19-21 proceeds of which are subject to the lien; or 19-22 (2) claims for charges for the care of the livestock, 19-23 the proceeds of which are subject to the lien. 19-24 (Sections 188.027-188.030 reserved for expansion 19-25 SUBCHAPTER D. INFORMATION CONCERNING LIEN 19-26 Sec. 188.031. ISSUANCE OF CERTIFICATE TO MEMBER OF PUBLIC; 19-27 FEE. (a) A person may obtain a certificate identifying any lien 20-1 on file and any notice of claim of lien naming a particular debtor 20-2 and stating the date and time of filing of each notice and the 20-3 names and addresses of each lienholder in the certificate. 20-4 (b) The fee for a certificate under Subsection (a) shall be 20-5 established by the secretary of state in an amount necessary to 20-6 cover the cost of administering this section. 20-7 Sec. 188.032. COPIES OF NOTICES OF CLAIM OF LIEN AND OTHER 20-8 NOTICES; FEE. (a) A person may obtain a copy of any notice of 20-9 claim of an animal feed lien filed. 20-10 (b) The fee for a copy of a notice of claim of lien obtained 20-11 under Subsection (a) shall be established by the secretary of state 20-12 in an amount necessary to cover the cost of administering this 20-13 section. 20-14 (Sections 188.033-188.035 reserved for expansion 20-15 SUBCHAPTER E. ENFORCEMENT OF LIEN 20-16 Sec. 188.036. WRITTEN NOTICE TO SECURED CREDITORS BY LIEN 20-17 CLAIMANT. (a) A lien claimant shall provide written notice to any 20-18 secured creditor at least 30 days before the date the lien claimant 20-19 enforces a claim of lien. 20-20 (b) For purposes of this section, "secured creditor" means 20-21 any entity named as a secured party in a financing statement that 20-22 is filed regarding the debtor and that covers an animal product, an 20-23 account, or livestock subject to the lien. 20-24 Sec. 188.037. FORECLOSURE IN ACTION TO RECOVER REASONABLE OR 20-25 AGREED CHARGES. The lien claimant may foreclose on a lien under 20-26 this chapter only in an action to recover the reasonable or agreed 20-27 charges. 21-1 Sec. 188.038. TERMINATION STATEMENT. (a) If a lien 21-2 claimant receives payment for the total amount secured by a lien 21-3 under this chapter and the lien claimant has not furnished animal 21-4 feed during the 45-day period before the date on which payment is 21-5 received, the lien claimant shall file a termination statement with 21-6 the secretary of state and shall send the lien debtor a copy of the 21-7 statement as provided by this section. The statement shall state 21-8 that the lien claimant no longer claims a security interest under 21-9 the notice of claim of lien. 21-10 (b) The notice of claim of lien must be identified in the 21-11 statement under Subsection (a) by the date, names of parties to the 21-12 agreement, and file number of the original lien. 21-13 (c) If the lien claimant does not send the termination 21-14 statement required by this section before the 11th day after the 21-15 date on which the lien claimant received payment, the lien claimant 21-16 is liable to the lien debtor for actual damages suffered by the 21-17 lien debtor as a result of the failure. If the lien claimant acts 21-18 in bad faith in failing to send the statement, the lien claimant is 21-19 liable for an additional penalty of $100. 21-20 (d) The filing officer in the secretary of state's office 21-21 shall mark each termination statement with the date and time of 21-22 filing and shall index the statement under the name of the lien 21-23 debtor and under the file number of the original lien. If the 21-24 filing officer has a microfilm or other photographic record of the 21-25 lien and related filings, the filing officer may destroy the filed 21-26 notice of claim of lien at any time after receiving the termination 21-27 statement. If the filing officer does not have a photographic 22-1 record, the filing officer may destroy the filed notice of claim of 22-2 lien at any time after the first anniversary of the date on which 22-3 the filing officer received the termination statement. 22-4 (e) The uniform filing fee for filing and indexing the 22-5 termination statement is the same as the fee assessed under Section 22-6 9.404(c), Business & Commerce Code. 22-7 Sec. 188.039. RIGHT OF ASSIGNMENT OR TRANSFER; FILING OF 22-8 STATEMENT. (a) A lien created under this chapter may be assigned 22-9 by the holder of the lien, with full rights of enforcement. 22-10 (b) The lienholder shall file a statement of assignment with 22-11 the secretary of state as provided by Section 9.405, Business & 22-12 Commerce Code. 22-13 (Sections 188.040-188.045 reserved for expansion 22-14 SUBCHAPTER F. MISCELLANEOUS 22-15 Sec. 188.046. RULES. The secretary of state may adopt rules 22-16 necessary to carry out the secretary's duties under this chapter, 22-17 including prescribing necessary forms. 22-18 Sec. 188.047. MAXIMUM NUMBER OF LIENS. Not more than four 22-19 liens may be enforced under this chapter against the same proceeds 22-20 of a lien debtor even if the liens are filed by different lien 22-21 claimants. 22-22 Sec. 188.048. APPLICABILITY OF OTHER LAW. Chapter 9, 22-23 Business & Commerce Code, applies to a lien created under this 22-24 chapter to the extent Chapter 9 is consistent with this chapter. 22-25 SECTION 3. (a) Chapter 128, Agriculture Code, as added by 22-26 this Act, applies to an agricultural chemical, agricultural seed, 22-27 or labor supplied on or after the effective date of this Act. 23-1 (b) Chapter 188, Agriculture Code, as added by this Act, 23-2 applies to animal feed and labor supplied on or after the effective 23-3 date of this Act. 23-4 SECTION 4. This Act takes effect September 1, 1995. 23-5 SECTION 5. The importance of this legislation and the 23-6 crowded condition of the calendars in both houses create an 23-7 emergency and an imperative public necessity that the 23-8 constitutional rule requiring bills to be read on three several 23-9 days in each house be suspended, and this rule is hereby suspended.