H.B. 1398 78(R)    BILL ANALYSIS


H.B. 1398
By: Swinford
Agriculture & Livestock
Committee Report (Amended)


BACKGROUND AND PURPOSE 

In 1989, the Legislature enacted the Texas Seed Arbitration Act (Act) to
provide for an unbiased third party investigation by the State Seed and
Plant Board (Board) of the Texas Department of Agriculture, of complaints
concerning seed performance.  When a purchaser of a seed designed for
planting claims to have been damaged due to a failure of the seed to
produce or perform as a result of defect or negligence, the purchaser must
submit a claim of defect to the Board to begin the arbitration process.  

The Texas Supreme Court ruled in February 2001, that without regard to the
length of time after the purchaser of seed discovered a defect in seed
performance, the purchaser must only file a complaint with the Board to be
in compliance with the Act, in turn allowing claims to be filed against
seed companies many months after which actual seed performance could
reasonably be determined.   The Board needs to evaluate seed performance
under field conditions to properly investigate and accurately report on
arbitration cases. 

H.B. 1398 designates a time period, ending the 10th day after a purchaser
of seed has discovered or reasonably should have discovered a defect in
the seed performance, to file a claim against the seed manufacturer or
distributor, allowing the Board to complete an investigation under field
conditions. 


RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency, or
institution. 

ANALYSIS

H.B. 1398 amends the Agriculture Code by creating a 10-day period in which
a purchaser of seed must file a complaint against the seed manufacturer or
distributor if the purchaser believes to have been damaged by the
defective seed.  This period ends on the 10th day after the purchaser
discovered or reasonably should have discovered the defect. 

The bill amends the Agriculture Code removing language allowing a court
the ability to use Board findings concerning a delay in filing of an
arbitration claim.  The bill deletes a provision exempting the purchaser
of seed from filing a claim in cases where a seed had not been planted.
The bill creates a new section in the  Agriculture Code relating to Effect
of Noncompliance, establishing that the Board may dismiss a purchaser's
claim if the claim is not submitted by the 10th day after which the defect
is or reasonably should have been noticed.  A court does not have the
authority to hear an arbitration case that has been previously dismissed
by the Board.   

EFFECTIVE DATE

September 1, 2003.

EXPLANATION OF AMENDMENTS

Committee Amendment #1 deletes the language in Section 64.0065,
Agriculture Code, stating that a court does not have jurisdiction to hear
a claim that have been previously dismissed by the Board.