1-1        By:  Swinford (Senate Sponsor - Haywood)        H.B. No. 1463
    1-2        (In the Senate - Received from the House April 18, 1995;
    1-3  April 19, 1995, read first time and referred to Committee on
    1-4  Natural Resources; May 5, 1995, reported favorably by the following
    1-5  vote:  Yeas 8, Nays 2; May 5, 1995, sent to printer.)
    1-6                         A BILL TO BE ENTITLED
    1-7                                AN ACT
    1-8  relating to a lien in favor of a seller of agricultural chemicals,
    1-9  agricultural seeds, or animal feed or of a provider of labor in
   1-10  connection with the agricultural chemicals or agricultural seeds;
   1-11  providing penalties.
   1-12        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
   1-13        SECTION 1.  Title 5, Agriculture Code, is amended by adding
   1-14  Subtitle H to read as follows:
   1-15                   SUBTITLE H.  HORTICULTURAL LIENS
   1-16          CHAPTER 128.  AGRICULTURAL CHEMICAL AND SEED LIENS
   1-17                   SUBCHAPTER A.  GENERAL PROVISIONS
   1-18        Sec. 128.001.  DEFINITIONS.  In this chapter:
   1-19              (1)  "Agricultural chemical" includes fertilizer
   1-20  material as defined under Section 63.001, pesticides as defined
   1-21  under Section 76.001, plant regulators as defined under Section
   1-22  76.001, lime, plant and soil amendments, plant food, herbicides,
   1-23  and chemical compounds that are applied to crops or to land used
   1-24  for growing crops.
   1-25              (2)  "Agricultural seed" has the meaning assigned under
   1-26  Section 61.001.
   1-27              (3)  "Labor" means labor or services performed in the
   1-28  application, delivery, or preparation of an agricultural chemical
   1-29  or agricultural seed.
   1-30              (4)  "Reasonable or agreed charges" means:
   1-31                    (A)  any agreed price for agricultural chemicals,
   1-32  agricultural seeds, or labor sold or provided to a lien debtor at
   1-33  the lien debtor's request; or
   1-34                    (B)  the reasonable value of agricultural
   1-35  chemicals, agricultural seeds, or labor, as of the date of
   1-36  application, delivery, or preparation, if there is not an agreed
   1-37  price or an agreed method for determining price.
   1-38        Sec. 128.002.  PROCEEDS.  (a)  For the purposes of this
   1-39  chapter, proceeds are the amounts received by a lien debtor, before
   1-40  a deduction for taxes, fees, or assessments or a deduction made
   1-41  under a court order, from the sale of:
   1-42              (1)  the crop that existed at the time of application
   1-43  on the land of the agricultural chemical sold by the lien claimant
   1-44  or applied, delivered, or prepared by the lien claimant;
   1-45              (2)  the first crop produced on the land after the
   1-46  agricultural chemical sold by the lien claimant or applied,
   1-47  delivered, or prepared by the lien claimant was applied, if crops
   1-48  did not exist on the land at the time the agricultural chemical was
   1-49  applied; or
   1-50              (3)  the crop produced from the agricultural seed
   1-51  supplied by the lien claimant or applied, delivered, or prepared by
   1-52  the lien claimant.
   1-53        (b)  For the purposes of this chapter, the following are not
   1-54  included as proceeds:
   1-55              (1)  amounts due or owing to a cooperative association
   1-56  under Chapter 51 or 52; or
   1-57              (2)  amounts retained by a cooperative association
   1-58  under Chapter 51 or 52.
   1-59           (Sections 128.003-128.005 reserved for expansion
   1-60          SUBCHAPTER B.  AGRICULTURAL CHEMICAL AND SEED LIEN
   1-61        Sec. 128.006.  NOTICE BEFORE PURCHASE; REQUIRED NOTICE BEFORE
   1-62  CLAIMING LIEN.  (a)  A person claiming a lien under this chapter
   1-63  must have provided notice of the provisions of this chapter, before
   1-64  purchase, either generally to purchasers of agricultural chemicals,
   1-65  agricultural seeds, or labor as part of the lien claimant's normal
   1-66  business practices or specifically to the lien debtor.  Notice
   1-67  provided under this subsection must read, to the extent applicable,
   1-68  substantially as follows:  "The sale of agricultural chemicals or
    2-1  agricultural seed on credit and the provision of labor related to
    2-2  agricultural chemicals or agricultural seed is subject to Chapter
    2-3  128, Agriculture Code.  Failure to pay the agreed or reasonable
    2-4  charges for the chemicals, seed, or labor may result in the
    2-5  attachment of a lien to the proceeds of the agricultural products
    2-6  produced with the aid of the chemicals, seed, or labor."  A
    2-7  potential lien claimant may satisfy the requirements of this
    2-8  subsection:
    2-9              (1)  by printing or stamping the notice on credit
   2-10  applications filled out by purchasers; and
   2-11              (2)  for future purchases by purchasers who are not
   2-12  notified on the credit application, by printing or stamping the
   2-13  notice on an invoice or on a statement sent by separate cover.
   2-14        (b)  Before a person may claim a lien under this chapter, the
   2-15  person must send to the debtor by certified mail written notice
   2-16  that states:
   2-17              (1)  that the payment of the reasonable or agreed
   2-18  charges is more than 30 days overdue;
   2-19              (2)  the amount that is overdue;
   2-20              (3)  that the debtor has the following three
   2-21  alternatives:
   2-22                    (A)  to allow the lien to be filed;
   2-23                    (B)  to enter into an agreement granting a
   2-24  security interest in the proceeds described by Section 128.002
   2-25  under the Business & Commerce Code; or
   2-26                    (C)  to pay the reasonable or agreed charges; and
   2-27              (4)  in at least 10-point type, that:
   2-28                    (A)  the debtor has until the 10th day after the
   2-29  date on which the notice is received to select an alternative under
   2-30  Subdivision (3), notify the claimant of the alternative selected,
   2-31  and satisfy all the requirements of the selected alternative; and
   2-32                    (B)  the claimant may file the notice of claim of
   2-33  lien at any time after the 10th day after the date on which the
   2-34  debtor receives the notice if the debtor does not comply with the
   2-35  requirements of Paragraph (A).
   2-36        Sec. 128.007.  ATTACHMENT OF LIEN.  A lien established under
   2-37  this chapter attaches to the proceeds  described by Section
   2-38  128.002.
   2-39        Sec. 128.008.  AMOUNT OF LIEN.  The amount of a lien under
   2-40  this chapter is equal to the sum of:
   2-41              (1)  the amount of the unpaid reasonable or agreed
   2-42  charges for:
   2-43                    (A)  agricultural chemicals, labor, or both, as
   2-44  appropriate, furnished within the 60-day period ending on the day
   2-45  the lien attaches; and
   2-46                    (B)  agricultural seeds, labor, or both, as
   2-47  appropriate, furnished within the 45-day period ending on the day
   2-48  the lien attaches; and
   2-49              (2)  the filing fees for the lien as provided by this
   2-50  chapter.
   2-51        Sec. 128.009.  PERSON ENTITLED TO FILE; EXCEPTION.  (a)
   2-52  Except as provided by Subsection (b) or by Section 128.047, a
   2-53  person who provides an agricultural chemical, agricultural seed, or
   2-54  labor may file a notice of claim of lien as provided by this
   2-55  chapter.
   2-56        (b)  A claimant may not file a notice of claim of lien if the
   2-57  arbitration of a dispute between the claimant and the debtor is
   2-58  pending or has not been resolved under Chapter 64.  A claimant may
   2-59  not file a notice of claim of lien  if the settlement of a dispute
   2-60  between the claimant and the  debtor is pending or has not been
   2-61  resolved under Section 128.012.
   2-62        Sec. 128.010.  PERFECTION OF LIEN.  A lien created under this
   2-63  chapter is perfected on the filing of a notice of claim of lien
   2-64  with the secretary of state as provided by this chapter.
   2-65        Sec. 128.011.  DURATION OF NOTICE OF CLAIM OF LIEN.  (a)
   2-66  Except as otherwise provided by this chapter, the notice of claim
   2-67  of lien is effective, and a new notice of claim of lien is not
   2-68  required to maintain the lien, as long as the person who provides
   2-69  the agricultural chemical, agricultural seed, or labor either:
   2-70              (1)  remains unpaid for the amount secured by the lien;
    3-1  or
    3-2              (2)  continues to provide an agricultural chemical,
    3-3  agricultural seed, or labor on a regular basis to the lien debtor.
    3-4        (b)  For purposes of this section, providing an agricultural
    3-5  chemical, agricultural seed, or labor is not considered to be made
    3-6  on a regular basis if a period of more than 45 days elapses between
    3-7  applications, deliveries, or preparations.
    3-8        Sec. 128.012.  PROCEDURES FOR SETTLEMENT OF DISPUTES.  (a)
    3-9  The commissioner of agriculture by rule shall establish a procedure
   3-10  to settle a dispute between a claimant supplying agricultural
   3-11  chemicals or labor in the application, delivery, or preparation of
   3-12  agricultural chemicals and a debtor.  The procedures must provide:
   3-13              (1)  a time requirement for submitting the dispute to
   3-14  the department;
   3-15              (2)  a time requirement within which a notice of the
   3-16  dispute must be submitted to each party; and
   3-17              (3)  a process for evaluating the dispute.
   3-18        (b)  Each party to the dispute is equally liable for the
   3-19  reasonable costs incurred by the department in carrying out this
   3-20  section.
   3-21        Sec. 128.013.  CONTENTS OF NOTICE OF CLAIM OF LIEN.  The
   3-22  notice of claim of lien must include:
   3-23              (1)  the name and address of the lien claimant;
   3-24              (2)  the name and address of the lien debtor;
   3-25              (3)  the location of the property to which the
   3-26  agricultural chemical, agricultural seed, or labor was provided;
   3-27              (4)  a statement that the payment of the reasonable or
   3-28  agreed charges is more than 30 days overdue;
   3-29              (5)  the amount that is overdue;
   3-30              (6)  a statement, signed under penalty of perjury,
   3-31  that:
   3-32                    (A)  the lien claimant provided notice of the
   3-33  provisions of this chapter, before purchase, either generally to
   3-34  purchasers of agricultural chemicals, agricultural seeds, or labor
   3-35  as part of the lien claimant's normal business practices or
   3-36  specifically to the lien debtor, in the manner required by Section
   3-37  128.006(a);
   3-38                    (B)  the lien claimant sent to the lien debtor
   3-39  the notice required by Section 128.006(b);
   3-40                    (C)  more than 10 days have elapsed since the
   3-41  date on which the notice was received by the lien debtor; and
   3-42                    (D)  the lien debtor has not complied with the
   3-43  requirements of an alternative set out by Section 128.006(b); and
   3-44              (7)  a statement that the lien claimant has an
   3-45  agricultural chemical or agricultural seed lien under this chapter.
   3-46        Sec. 128.014.  SIGNATURE.  The notice of claim of lien shall
   3-47  be signed by the lien claimant or by a person authorized to sign
   3-48  documents of a similar kind on behalf of the claimant.
   3-49        Sec. 128.015.  FORM.  (a)  The notice of claim of lien must
   3-50  be filed on a form that satisfies the requirements of a financing
   3-51  statement under Section 9.402, Business & Commerce Code, except
   3-52  that:
   3-53              (1)  the lien claimant may be identified either as a
   3-54  lien claimant or as a secured party;
   3-55              (2)  the form must be signed by the lien claimant and
   3-56  is not required to be signed by the lien debtor; and
   3-57              (3)  in the space for the description of the
   3-58  collateral, the information specified in Sections 128.013(3), (4),
   3-59  (5), and (7) must be entered.
   3-60        (b)  A separately signed statement containing the information
   3-61  specified in Section 128.013(6) shall be attached to the form
   3-62  required under Subsection (a).
   3-63        Sec. 128.016.  FILING AND MARKING IN OFFICE OF SECRETARY OF
   3-64  STATE; FEE.  (a)  The notice of claim of lien shall be filed and
   3-65  marked in the office of the secretary of state in the same manner
   3-66  as a financing statement is filed and marked under Section 9.403,
   3-67  Business & Commerce Code.
   3-68        (b)  The uniform fee for filing and indexing and for stamping
   3-69  a copy furnished by the secured party is the same as the fee
   3-70  assessed under Section 9.403, Business & Commerce Code.
    4-1        Sec. 128.017.  TIME OF WRITTEN NOTICE.  The lien claimant
    4-2  shall provide written notice of the claim of lien to the lien
    4-3  debtor not later than the 10th day after the date the notice of
    4-4  claim of lien is filed with the office of the secretary of state.
    4-5        Sec. 128.018.  RECOGNITION OF NOTICE AS FINANCING STATEMENT.
    4-6  The secretary of state shall recognize a notice of claim of lien
    4-7  under this subchapter as a financing statement under Section 9.402,
    4-8  Business & Commerce Code.
    4-9           (Sections 128.019-128.025 reserved for expansion
   4-10                    SUBCHAPTER C.  PRIORITY OF LIEN
   4-11        Sec. 128.026.  TIME OF FILING.  (a)  A lien created under
   4-12  this chapter has the same priority as a security interest perfected
   4-13  by the filing of a financing statement on the date the notice of
   4-14  claim of lien was filed.
   4-15        (b)  A lien created under this chapter does not have priority
   4-16  over labor claims for wages and salaries for personal services that
   4-17  are provided by an employee to a lien debtor in connection with the
   4-18  production of agricultural products, the proceeds of which are
   4-19  subject to the lien.
   4-20           (Sections 128.027-128.030 reserved for expansion
   4-21              SUBCHAPTER D.  INFORMATION CONCERNING LIEN
   4-22        Sec. 128.031.  ISSUANCE OF CERTIFICATE TO MEMBER OF PUBLIC;
   4-23  FEE.  (a)  A person may obtain a certificate identifying any lien
   4-24  on file and any notice of claim of lien naming a particular debtor
   4-25  and stating the date and time of filing of each notice and the
   4-26  names and addresses of each lienholder in the certificate.
   4-27        (b)  The fee for a certificate under Subsection (a) shall be
   4-28  established by the secretary of state in an amount necessary to
   4-29  cover the cost of administering this section.
   4-30        Sec. 128.032.  COPIES OF NOTICES OF CLAIM OF LIEN AND OTHER
   4-31  NOTICES; FEE.  (a)  A person may obtain a copy of any notice of
   4-32  claim of an agricultural chemical or seed lien filed.
   4-33        (b)  The fee for a copy of a notice of claim of lien obtained
   4-34  under Subsection (a)  shall be established by the secretary of
   4-35  state in an amount necessary to cover the cost of administering
   4-36  this section.
   4-37           (Sections 128.033-128.035 reserved for expansion
   4-38                  SUBCHAPTER E.  ENFORCEMENT OF LIEN
   4-39        Sec. 128.036.  WRITTEN NOTICE TO SECURED CREDITORS BY LIEN
   4-40  CLAIMANT.  (a)  A lien claimant shall provide written notice to any
   4-41  secured creditor at least 30 days before the date the lien claimant
   4-42  enforces a claim of lien.
   4-43        (b)  For purposes of this section, "secured creditor" means
   4-44  any entity named as a secured party in a financing statement that
   4-45  is filed regarding the debtor and that covers:
   4-46              (1)  a farm product, an account, or a crop subject to
   4-47  the lien;
   4-48              (2)  a crop growing or grown on the land on which the
   4-49  agricultural chemical was applied or for which the agricultural
   4-50  seed was supplied; or
   4-51              (3)  the next crop to be grown on that land, if a crop
   4-52  is not planted.
   4-53        Sec. 128.037.  FORECLOSURE IN ACTION TO RECOVER REASONABLE OR
   4-54  AGREED CHARGES.  The lien claimant may foreclose on a lien under
   4-55  this chapter only in an action to recover the reasonable or agreed
   4-56  charges.
   4-57        Sec. 128.038.  TERMINATION STATEMENT.  (a)  If a lien
   4-58  claimant receives payment for the total amount secured by a lien
   4-59  under this chapter and the lien claimant has not furnished an
   4-60  agricultural chemical, agricultural seed, or labor during the
   4-61  45-day period before the date on which payment is received, the
   4-62  lien claimant shall file a termination statement with the secretary
   4-63  of state and shall send the lien debtor a copy of the statement as
   4-64  provided by this section.  The statement shall state that the lien
   4-65  claimant no longer claims a security interest under the notice of
   4-66  claim of lien.
   4-67        (b)  The notice of claim of lien must be identified in the
   4-68  statement under Subsection (a) by the date, names of parties to the
   4-69  agreement, and file number of the original lien.
   4-70        (c)  If the lien claimant does not send the termination
    5-1  statement required by this section before the 11th day after the
    5-2  date on which the lien claimant received payment, the lien claimant
    5-3  is liable to the lien debtor for actual damages suffered by the
    5-4  lien debtor as a result of the failure.  If the lien claimant acts
    5-5  in bad faith in failing to send the statement, the lien claimant is
    5-6  liable for an additional penalty of $100.
    5-7        (d)  The filing officer in the secretary of state's office
    5-8  shall mark each termination statement with the date and time of
    5-9  filing and shall index the statement under the name of the lien
   5-10  debtor and under the file number of the original lien.  If the
   5-11  filing officer has a microfilm or other photographic record of the
   5-12  lien and related filings, the filing officer may destroy the  filed
   5-13  notice of claim of lien at any time after receiving the termination
   5-14  statement.  If the filing officer does not have a photographic
   5-15  record, the filing officer may destroy the filed notice of claim of
   5-16  lien at any time after the first anniversary of the date on which
   5-17  the filing officer received the termination statement.
   5-18        (e)  The uniform filing fee for filing and indexing the
   5-19  termination statement is the same as the fee assessed under Section
   5-20  9.404(c), Business & Commerce Code.
   5-21        Sec. 128.039.  RIGHT OF ASSIGNMENT OR TRANSFER; FILING OF
   5-22  STATEMENT.  (a)  A lien created under this chapter may be assigned
   5-23  by the holder of the lien, with full rights of enforcement.
   5-24        (b)  The lienholder shall file a statement of assignment with
   5-25  the secretary of state as provided by Section 9.405, Business &
   5-26  Commerce Code.
   5-27           (Sections 128.040-128.045 reserved for expansion
   5-28                     SUBCHAPTER F.  MISCELLANEOUS
   5-29        Sec. 128.046.  RULES.  The secretary of state may adopt rules
   5-30  necessary to carry out the secretary's duties under this chapter,
   5-31  including prescribing necessary forms.
   5-32        Sec. 128.047.  MAXIMUM NUMBER OF LIENS.  Not more than four
   5-33  liens may be enforced under this chapter against the same proceeds
   5-34  of a lien debtor even if the liens are filed by different lien
   5-35  claimants.
   5-36        Sec. 128.048.  APPLICABILITY OF OTHER LAW.  Chapter 9,
   5-37  Business & Commerce Code, applies to a lien created under this
   5-38  chapter to the extent Chapter 9 is consistent with this chapter.
   5-39        SECTION 2.  Title 6, Agriculture Code, is amended by adding
   5-40  Subtitle E to read as follows:
   5-41                 SUBTITLE E.  LIENS ON ANIMAL PRODUCTS
   5-42                  CHAPTER 188.  LIENS FOR ANIMAL FEED
   5-43                   SUBCHAPTER A.  GENERAL PROVISIONS
   5-44        Sec. 188.001.  DEFINITIONS.  In this chapter:
   5-45              (1)  "Animal feed" includes:
   5-46                    (A)  commercial feed as described by Section
   5-47  141.002(a), including a substance listed by Section 141.002(c) if
   5-48  used as a feed for animals; or
   5-49                    (B)  customer-formula feed as defined under
   5-50  Section 141.001.
   5-51              (2)  "Labor" means labor or services performed in the
   5-52  delivery or preparation of animal feed provided by the seller of
   5-53  the animal feed.
   5-54              (3)  "Livestock" means beef cattle, dairy cattle,
   5-55  sheep, goats, hogs, horses, poultry, and ratites.
   5-56              (4)  "Reasonable or agreed charges" means:
   5-57                    (A)  any agreed price for animal feed, including
   5-58  labor, sold to a lien debtor at the lien debtor's request; or
   5-59                    (B)  the reasonable value of animal feed,
   5-60  including labor, as of the date of delivery or preparation, if
   5-61  there is not an agreed price or an agreed method for determining
   5-62  price.
   5-63        Sec. 188.002.  PROCEEDS.  (a)  For the purposes of this
   5-64  chapter, proceeds are the amounts received by a lien debtor, before
   5-65  a deduction for taxes, fees, or assessments or a deduction made
   5-66  under a court order, from the sale of:
   5-67              (1)  the livestock for which the animal feed was used;
   5-68              (2)  meat, milk, skins, wool, or other products derived
   5-69  from that livestock; or
   5-70              (3)  issue born to that livestock.
    6-1        (b)  For the purposes of this chapter, proceeds do not
    6-2  include amounts:
    6-3              (1)  due or owing to a cooperative association under
    6-4  Chapter 51 or 52; or
    6-5              (2)  retained by a cooperative association under
    6-6  Chapter 51 or 52.
    6-7           (Sections 188.003-188.005 reserved for expansion
    6-8                    SUBCHAPTER B.  ANIMAL FEED LIEN
    6-9        Sec. 188.006.  NOTICE BEFORE PURCHASE; REQUIRED NOTICE BEFORE
   6-10  CLAIMING LIEN.  (a)  A person claiming a lien under this chapter
   6-11  must have provided notice of the provisions of this chapter, before
   6-12  purchase, either generally to purchasers of animal feed as part of
   6-13  the lien claimant's normal business practices or specifically to
   6-14  the lien debtor.  Notice provided under this subsection must read,
   6-15  to the extent applicable, substantially as follows:  "The sale of
   6-16  animal feed on credit is subject to Chapter 188, Agriculture Code.
   6-17  Failure to pay the agreed or reasonable charges for the feed may
   6-18  result in the attachment of a lien to the proceeds of the livestock
   6-19  for which the feed is used or the proceeds of the animal products
   6-20  produced from the livestock."  A potential lien claimant may
   6-21  satisfy the requirements of this subsection:
   6-22              (1)  by printing or stamping the notice on credit
   6-23  applications filled out by purchasers; and
   6-24              (2)  for future purchases by purchasers who are not
   6-25  notified on the credit application, by printing or stamping the
   6-26  notice on an invoice or on a statement sent by separate cover.
   6-27        (b)  Before a person may claim a lien under this chapter, the
   6-28  person must send to the debtor by certified mail written notice
   6-29  that states:
   6-30              (1)  that the payment of the reasonable or agreed
   6-31  charges is more than 30 days overdue;
   6-32              (2)  the amount that is overdue;
   6-33              (3)  that the debtor has the following three
   6-34  alternatives:
   6-35                    (A)  to allow the lien to be filed;
   6-36                    (B)  to enter into an agreement granting a
   6-37  security interest in the proceeds described by Section 188.002
   6-38  under the Business & Commerce Code; or
   6-39                    (C)  to pay the reasonable or agreed charges; and
   6-40              (4)  in at least 10-point type, that:
   6-41                    (A)  the debtor has until the 10th day after the
   6-42  date on which the notice is received to select an alternative under
   6-43  Subdivision (3), notify the claimant of the alternative selected,
   6-44  and satisfy all the requirements of the selected alternative; and
   6-45                    (B)  the claimant may file the notice of claim of
   6-46  lien at any time after the 10th day after the date on which the
   6-47  debtor receives the notice if the debtor does not comply with the
   6-48  requirements of Paragraph (A).
   6-49        Sec. 188.007.  ATTACHMENT OF LIEN.  A lien established under
   6-50  this chapter attaches to the proceeds described by Section 188.002.
   6-51        Sec. 188.008.  AMOUNT OF LIEN.  The amount of a lien under
   6-52  this chapter is equal to the sum of:
   6-53              (1)  the amount of the unpaid reasonable or agreed
   6-54  charges for animal feed furnished within the 45-day period ending
   6-55  on the day the lien attaches; and
   6-56              (2)  the filing fees for the lien as provided by this
   6-57  chapter.
   6-58        Sec. 188.009.  PERSON ENTITLED TO FILE; EXCEPTION.  (a)
   6-59  Except as provided by Subsection (b) or by Section 188.047, a
   6-60  person who provides animal feed may file a notice of claim of lien
   6-61  as provided by this chapter.
   6-62        (b)  The claimant may not file a notice of claim of lien if
   6-63  the settlement of a dispute between the claimant and the debtor is
   6-64  pending or has not been resolved under Section 188.012.
   6-65        Sec. 188.010.  PERFECTION OF LIEN.  A lien created under this
   6-66  chapter is perfected on the filing of a notice of claim of lien
   6-67  with the secretary of state as provided by this chapter.
   6-68        Sec. 188.011.  DURATION OF NOTICE OF CLAIM OF LIEN.  (a)
   6-69  Except as otherwise provided by this chapter, the notice of claim
   6-70  of lien is effective, and a new notice of claim of lien is not
    7-1  required to maintain the lien, as long as the person who provides
    7-2  the animal feed, including labor, either:
    7-3              (1)  remains unpaid for the amount secured by the lien;
    7-4  or
    7-5              (2)  continues to provide animal feed on a regular
    7-6  basis to the lien debtor.
    7-7        (b)  For purposes of this section, providing animal feed,
    7-8  including labor, is not considered to be made on a regular basis if
    7-9  a period of more than 45 days elapses between deliveries or
   7-10  preparations.
   7-11        Sec. 188.012.  PROCEDURES FOR SETTLEMENT OF DISPUTES.  (a)
   7-12  The commissioner of agriculture by rule shall establish a procedure
   7-13  to settle a dispute between a claimant supplying animal feed and
   7-14  labor and a debtor.  The procedures must provide:
   7-15              (1)  a time requirement for submitting the dispute to
   7-16  the department;
   7-17              (2)  a time requirement within which a notice of the
   7-18  dispute must be submitted to each party; and
   7-19              (3)  a process for evaluating the dispute.
   7-20        (b)  Each party to the dispute is equally liable for the
   7-21  reasonable costs incurred by the department in carrying out this
   7-22  section.
   7-23        Sec. 188.013.  CONTENTS OF NOTICE OF CLAIM OF LIEN.  The
   7-24  notice of claim of lien must include:
   7-25              (1)  the name and address of the lien claimant;
   7-26              (2)  the name and address of the lien debtor;
   7-27              (3)  the location of the livestock for which the animal
   7-28  feed was provided;
   7-29              (4)  a statement that the payment of the reasonable or
   7-30  agreed charges is more than 30 days overdue;
   7-31              (5)  the amount that is overdue;
   7-32              (6)  a statement, signed under penalty of perjury,
   7-33  that:
   7-34                    (A)  the lien claimant provided notice of the
   7-35  provisions of this chapter, before purchase, either generally to
   7-36  purchasers of animal feed as part of the lien claimant's normal
   7-37  business practices or specifically to the lien debtor, in the
   7-38  manner required by Section 188.006(a);
   7-39                    (B)  the lien claimant sent to the lien debtor
   7-40  the notice required by Section 188.006(b);
   7-41                    (C)  more than 10 days have elapsed since the
   7-42  date on which the notice was received by the lien debtor; and
   7-43                    (D)  the lien debtor has not complied with the
   7-44  requirements of an alternative set out by Section 188.006(b); and
   7-45              (7)  a statement that the lien claimant has an animal
   7-46  feed lien under this chapter.
   7-47        Sec. 188.014.  SIGNATURE.  The notice of claim of lien shall
   7-48  be signed by the lien claimant or by a person authorized to sign
   7-49  documents of a similar kind on behalf of the claimant.
   7-50        Sec. 188.015.  FORM.  (a)  The notice of claim of lien must
   7-51  be filed on a form that satisfies the requirements of a financing
   7-52  statement under Section 9.402, Business & Commerce Code, except
   7-53  that:
   7-54              (1)  the lien claimant may be identified either as a
   7-55  lien claimant or as a secured party;
   7-56              (2)  the form must be signed by the lien claimant and
   7-57  is not required to be signed by the lien debtor; and
   7-58              (3)  in the space for the description of the
   7-59  collateral, the information specified in Sections 188.013(3), (4),
   7-60  (5), and (7) must be entered.
   7-61        (b)  A separately signed statement containing the information
   7-62  specified in Section 188.013(6) shall be attached to the form
   7-63  required under Subsection (a).
   7-64        Sec. 188.016.  FILING AND MARKING IN OFFICE OF SECRETARY OF
   7-65  STATE; FEE.  (a)  The notice of claim of lien shall be filed and
   7-66  marked in the office of the secretary of state in the same manner
   7-67  as a financing statement is filed and marked under Section 9.403,
   7-68  Business & Commerce Code.
   7-69        (b)  The uniform fee for filing and indexing and for stamping
   7-70  a copy furnished by the secured party is the same as the fee
    8-1  assessed under Section 9.403, Business & Commerce Code.
    8-2        Sec. 188.017.  TIME OF WRITTEN NOTICE.  The lien claimant
    8-3  shall provide written notice of the claim of lien to the lien
    8-4  debtor not later than the 10th day after the date the notice of
    8-5  claim of lien is filed with the office of the secretary of state.
    8-6        Sec. 188.018.  RECOGNITION OF NOTICE AS FINANCING STATEMENT.
    8-7  The secretary of state shall recognize a notice of claim of lien
    8-8  under this subchapter as a financing statement under Section 9.402,
    8-9  Business & Commerce Code.
   8-10           (Sections 188.019-188.025 reserved for expansion
   8-11                    SUBCHAPTER C.  PRIORITY OF LIEN
   8-12        Sec. 188.026.  TIME OF FILING.  (a)  A lien created under
   8-13  this chapter has the same priority as a security interest perfected
   8-14  by the filing of a financing statement on the date the notice of
   8-15  claim of lien was filed.
   8-16        (b)  A lien created under this chapter does not have priority
   8-17  over:
   8-18              (1)  labor claims for wages and salaries for personal
   8-19  services that are provided by an employee to a lien debtor in
   8-20  connection with the livestock, the production of animal products
   8-21  derived from the livestock, or issue born to the livestock, the
   8-22  proceeds of which are subject to the lien; or
   8-23              (2)  claims for charges for the care of the livestock,
   8-24  the proceeds of which are subject to the lien.
   8-25           (Sections 188.027-188.030 reserved for expansion
   8-26              SUBCHAPTER D.  INFORMATION CONCERNING LIEN
   8-27        Sec. 188.031.  ISSUANCE OF CERTIFICATE TO MEMBER OF PUBLIC;
   8-28  FEE.  (a)  A person may obtain a certificate identifying any lien
   8-29  on file and any notice of claim of lien naming a particular debtor
   8-30  and stating the date and time of filing of each notice and the
   8-31  names and addresses of each lienholder in the certificate.
   8-32        (b)  The fee for a certificate under Subsection (a) shall be
   8-33  established by the secretary of state in an amount necessary to
   8-34  cover the cost of administering this section.
   8-35        Sec. 188.032.  COPIES OF NOTICES OF CLAIM OF LIEN AND OTHER
   8-36  NOTICES; FEE.  (a)  A person may obtain a copy of any notice of
   8-37  claim of an animal feed lien filed.
   8-38        (b)  The fee for a copy of a notice of claim of lien obtained
   8-39  under Subsection (a) shall be established by the secretary of state
   8-40  in an amount necessary to cover the cost of administering this
   8-41  section.
   8-42           (Sections 188.033-188.035 reserved for expansion
   8-43                  SUBCHAPTER E.  ENFORCEMENT OF LIEN
   8-44        Sec. 188.036.  WRITTEN NOTICE TO SECURED CREDITORS BY LIEN
   8-45  CLAIMANT.  (a)  A lien claimant shall provide written notice to any
   8-46  secured creditor at least 30 days before the date the lien claimant
   8-47  enforces a claim of lien.
   8-48        (b)  For purposes of this section, "secured creditor" means
   8-49  any entity named as a secured party in a financing statement that
   8-50  is filed regarding the debtor and that covers an animal product, an
   8-51  account, or livestock subject to the lien.
   8-52        Sec. 188.037.  FORECLOSURE IN ACTION TO RECOVER REASONABLE OR
   8-53  AGREED CHARGES.  The lien claimant may foreclose on a lien under
   8-54  this chapter only in an action to recover the reasonable or agreed
   8-55  charges.
   8-56        Sec. 188.038.  TERMINATION STATEMENT.  (a)  If a lien
   8-57  claimant receives payment for the total amount secured by a lien
   8-58  under this chapter and the lien claimant has not furnished animal
   8-59  feed during the 45-day period before the date on which payment is
   8-60  received, the lien claimant shall file a termination statement with
   8-61  the secretary of state and shall send the lien debtor a copy of the
   8-62  statement as provided by this section.  The statement shall state
   8-63  that the lien claimant no longer claims a security interest under
   8-64  the notice of claim of lien.
   8-65        (b)  The notice of claim of lien must be identified in the
   8-66  statement under Subsection (a) by the date, names of parties to the
   8-67  agreement, and file number of the original lien.
   8-68        (c)  If the lien claimant does not send the termination
   8-69  statement required by this section before the 11th day after the
   8-70  date on which the lien claimant received payment, the lien claimant
    9-1  is liable to the lien debtor for actual damages suffered by the
    9-2  lien debtor as a result of the failure.  If the lien claimant acts
    9-3  in bad faith in failing to send the statement, the lien claimant is
    9-4  liable for an additional penalty of $100.
    9-5        (d)  The filing officer in the secretary of state's office
    9-6  shall mark each termination statement with the date and time of
    9-7  filing and shall index the statement under the name of the lien
    9-8  debtor and under the file number of the original lien.  If the
    9-9  filing officer has a microfilm or other photographic record of the
   9-10  lien and related filings, the filing officer may destroy the filed
   9-11  notice of claim of lien at any time after receiving the termination
   9-12  statement.  If the filing officer does not have a photographic
   9-13  record, the filing officer may destroy the filed notice of claim of
   9-14  lien at any time after the first anniversary of the date on which
   9-15  the filing officer received the termination statement.
   9-16        (e)  The uniform filing fee for filing and indexing the
   9-17  termination statement is the same as the fee assessed under Section
   9-18  9.404(c), Business & Commerce Code.
   9-19        Sec. 188.039.  RIGHT OF ASSIGNMENT OR TRANSFER; FILING OF
   9-20  STATEMENT.  (a)  A lien created under this chapter may be assigned
   9-21  by the holder of the lien, with full rights of enforcement.
   9-22        (b)  The lienholder shall file a statement of assignment with
   9-23  the secretary of state as provided by Section 9.405, Business &
   9-24  Commerce Code.
   9-25           (Sections 188.040-188.045 reserved for expansion
   9-26                     SUBCHAPTER F.  MISCELLANEOUS
   9-27        Sec. 188.046.  RULES.  The secretary of state may adopt rules
   9-28  necessary to carry out the secretary's duties under this chapter,
   9-29  including prescribing necessary forms.
   9-30        Sec. 188.047.  MAXIMUM NUMBER OF LIENS.  Not more than four
   9-31  liens may be enforced under this chapter against the same proceeds
   9-32  of a lien debtor even if the liens are filed by different lien
   9-33  claimants.
   9-34        Sec. 188.048.  APPLICABILITY OF OTHER LAW.  Chapter 9,
   9-35  Business & Commerce Code, applies to a lien created under this
   9-36  chapter to the extent Chapter 9 is consistent with this chapter.
   9-37        SECTION 3.  (a)  Chapter 128, Agriculture Code, as added by
   9-38  this Act, applies to an agricultural chemical, agricultural seed,
   9-39  or labor supplied on or after the effective date of this Act.
   9-40        (b)  Chapter 188, Agriculture Code, as added by this Act,
   9-41  applies to animal feed and labor supplied on or after the effective
   9-42  date of this Act.
   9-43        SECTION 4.  This Act takes effect September 1, 1995.
   9-44        SECTION 5.  The importance of this legislation and the
   9-45  crowded condition of the calendars in both houses create an
   9-46  emergency and an imperative public necessity that the
   9-47  constitutional rule requiring bills to be read on three several
   9-48  days in each house be suspended, and this rule is hereby suspended.
   9-49                               * * * * *