By:  Cain                                             S.B. No. 1740
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to requirements for establishing a warehouseman's lien.
 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-4           SECTION 1.  Subsections (a) and (b), Section 7.209, Business
 1-5     & Commerce Code, are amended to read as follows:
 1-6           (a)(1)  A warehouseman has a lien against the bailor on the
 1-7     goods deposited [covered by a warehouse receipt] or on the proceeds
 1-8     thereof in his possession for charges for storage or transportation
 1-9     (including demurrage and terminal charges), insurance, labor, or
1-10     charges present or future in relation to the goods, and for
1-11     expenses necessary for preservation of the goods or reasonably
1-12     incurred in their sale pursuant to law.
1-13                 (2)  If the person on whose account the goods are held
1-14     is liable for like charges or expenses in relation to other goods
1-15     whenever deposited [and it is stated in the receipt that a lien is
1-16     claimed for charges and expenses in relation to other goods], the
1-17     warehouseman also has a lien against him for such charges and
1-18     expenses whether or not the other goods have been delivered by the
1-19     warehouseman.  But against a person to whom a negotiable warehouse
1-20     receipt is duly negotiated a warehouseman's lien is limited to
1-21     charges in an amount or at a rate specified on the receipt or if no
1-22     charges are so specified then to a reasonable charge for storage of
1-23     the goods covered by the receipt subsequent to the date of the
1-24     receipt.
1-25           (b)  The warehouseman may also reserve a security interest
 2-1     against the bailor [for a maximum amount specified on the receipt]
 2-2     for charges other than those specified in Subsection (a), such as
 2-3     for money advanced and interest.  If a warehouse receipt is issued
 2-4     for the goods, the security interest is not valid against a third
 2-5     person without notice to whom the receipt is duly negotiated unless
 2-6     the maximum amount of the security interest is conspicuously
 2-7     specified on the receipt.  Such a security interest is governed by
 2-8     the chapter on Secured Transactions (Chapter 9).
 2-9           SECTION 2.  This Act takes effect September 1, 2001.  The
2-10     change in law made by this Act applies only to goods delivered to a
2-11     warehouseman on or after the effective date of this Act.  Goods
2-12     delivered to a warehouseman before the effective date of this Act
2-13     are governed by the law in effect immediately before the effective
2-14     date of this Act, and that law is continued in effect for that
2-15     purpose.