SRC-JFA S.B. 1639 75(R)BILL ANALYSIS


Senate Research CenterS.B. 1639
By: Duncan
Jurisprudence
4-14-97
Committee Report (Amended)


DIGEST 

Currently, a cotton ginner is provided a lien under Section 9.310,
Business and Commerce Code. This conclusion is based upon a court decision
involving a certain set of facts.  The issue of a cotton ginner being able
to claim a lien under Section 9.310 has been raised in subsequent cases.
The industry is moving towards the use of electronic warehouse receipts,
and new farm legislation may change the marketing practices of today.
Both situations could impact future court decisions on whether or not a
cotton ginner has a lien under Section 9.310.  This bill would statutorily
establish a ginner's lien and set forth related guidelines under Section
70.003, Property Code.   

PURPOSE

As proposed, S.B. 1639 establish a lien for the processing or harvesting
of cotton under Section 70.003, Property Code.  

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends the heading of Section 70.003, Property Code, as
follows:  

Sec. 70.003.  New heading:  STABLE KEEPER'S, GARAGE MAN'S, PASTURER'S, AND
COTTON GINNER'S LIENS. 

SECTION 2. Amends Section 70.003, Property Code, by adding Subsection (d),
to provide that a cotton ginner to whom a cotton crop has been delivered
for processing or who is to be paid for harvesting a cotton crop has a
lien on the cotton processed or harvested for the amount of the charges
for the processing or harvesting.  Sets forth the rights of the
lienholder.  Requires the lienholder, under certain conditions, to request
the owner to pay the unpaid charge due and to notify the owner and any
other person having a lien on the cotton who has given actual notice of
that lien to the lienholder under this subsection of the fact that unless
payment is made by a certain date, the lienholder is entitled to sell the
cotton under any procedure authorized by Section 9.504, Business and
Commerce Code.  Entitles the lienholder under certain conditions to sell
the cotton without notice at a commercially reasonable sale.  Sets forth
the distribution of the proceeds of a sale under this subsection.   

SECTION 3. Amends the heading of Section 70.005, Property Code, as
follows:  

Sec. 70.005.  New heading:  SALE OF PROPERTY.

SECTION 4. Amends Section 70.005(a), Property Code, to make conforming and
standard recodification changes.  

SECTION 5. Makes application of this Act prospective.

SECTION 6. Effective date: September 1, 1997.

 SECTION 7. Emergency clause.  

SUMMARY OF COMMITTEE CHANGES

Amendment 1 

Page 1, line 22, insert "and any other person having a lien on the cotton
who has given actual notice of that lien to the lienholder under this
section," after "owner."   

Page 1, line 24, replace "at a public sale" with "under any procedure
authorized by Section 9.504 of the Texas Business and Commerce Code." 

Page 2, line 5, replace "property" with "cotton." 

Page 2, line 5, replace "public" with "commercially reasonable."