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AN ACT
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relating to the perfection and priority of an agricultural lien on |
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an agricultural crop. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 70.401(4), Property Code, is amended to |
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read as follows: |
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(4) "Contract purchaser" means a person who[, before
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the planting of an agricultural crop,] has agreed under a [written] |
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contract to purchase an agricultural [the] crop or otherwise pay |
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the agricultural producer for growing, producing, or harvesting the |
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agricultural crop. The term does not include a person who, as to |
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the transaction in question, is licensed and bonded under Chapter |
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14, Agriculture Code, or the United States Warehouse Act (7 U.S.C. |
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Section 241 et seq.). |
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SECTION 2. Sections 70.402(a) and (b), Property Code, are |
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amended to read as follows: |
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(a) An agricultural producer who, under a [written] |
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contract with a contract purchaser, is to receive consideration for |
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selling an agricultural crop grown, produced, or harvested by the |
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producer has a lien for the amount owed under the contract, or for |
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the reasonable value of the crop on the date of transfer or delivery |
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if there is no agreement [provision] concerning the amount owed |
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under the contract [in the agreement]. |
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(b) A lien created under this subchapter is on every |
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agricultural crop, either in raw or processed form, that has been |
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transferred or delivered by the agricultural producer and is in the |
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possession of the contract purchaser, and if the contract purchaser |
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sells all or part of the crop, on the proceeds of the sale. If the |
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agricultural crop is commingled after the crop has been transferred |
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or delivered, a lien created under this subchapter applies only to |
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that portion of the contract purchaser's inventory in an amount |
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that is equal to the amount of the crop transferred or delivered by |
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the agricultural producer. |
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SECTION 3. Section 70.403, Property Code, is amended to |
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read as follows: |
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Sec. 70.403. WHEN LIEN ATTACHES. A lien created under this |
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subchapter attaches [to the agricultural crop] on the date on which |
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physical possession of the agricultural crop is delivered or |
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transferred by the agricultural producer to the contract purchaser |
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or the purchaser's agent, or if there is to be a series of |
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deliveries to the contract purchaser or purchaser's agent, on the |
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date of the first [last] delivery of the agricultural crop to the |
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contract purchaser or purchaser's agent. |
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SECTION 4. Section 70.404, Property Code, is amended to |
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read as follows: |
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Sec. 70.404. APPLICABILITY OF OTHER LAW. Except as |
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provided by Section 70.4045, Chapter 9, Business & Commerce Code, |
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including applicable filing and perfection requirements, applies |
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to a lien created under this subchapter. |
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SECTION 5. Subchapter E, Chapter 70, Property Code, is |
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amended by adding Section 70.4045 to read as follows: |
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Sec. 70.4045. PERFECTION AND PRIORITY OF AGRICULTURAL LIEN |
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ON CROPS. (a) Notwithstanding Chapter 9, Business & Commerce |
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Code, a lien created under this subchapter is perfected at the time |
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the lien attaches under Section 70.403 and continues to be |
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perfected if a financing statement covering the agricultural crop |
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is filed on or before the 90th day after the date: |
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(1) the physical possession of the crop is delivered |
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or transferred by the agricultural producer to the contract |
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purchaser or the purchaser's agent, if there is only one delivery |
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under the contract; or |
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(2) of the last delivery of the crop to the contract |
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purchaser or the purchaser's agent, if there is a series of |
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deliveries under the contract. |
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(b) If a financing statement covering the agricultural crop |
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is not filed within the time prescribed by Subsection (a)(1) or (2), |
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as applicable, the lien is considered unperfected on the date the |
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lien attached until the date the financing statement is filed or the |
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lien is perfected under Chapter 9, Business & Commerce Code. |
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(c) Notwithstanding Chapter 9, Business & Commerce Code, a |
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lien created and perfected under this subchapter has priority over |
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a conflicting security interest in or lien on the agricultural crop |
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or the proceeds from the sale of the crop created by the contract |
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purchaser in favor of a third party, other than a cotton ginner's |
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lien created under Section 70.003(d), regardless of the date the |
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security interest or lien created by the contract purchaser |
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attached. This subsection does not affect a security interest or |
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lien created and perfected to secure a loan directly to the |
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agricultural producer. |
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SECTION 6. The changes in law made by this Act apply only to |
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a lien that attaches under Section 70.403, Property Code, as |
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amended by this Act, on or after the effective date of this Act. A |
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lien that attaches before the effective date of this Act is governed |
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by the law as it existed immediately before that date, and that law |
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is continued in effect for that purpose. |
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SECTION 7. This Act takes effect September 1, 2015. |
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______________________________ |
______________________________ |
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President of the Senate |
Speaker of the House |
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I hereby certify that S.B. No. 1339 passed the Senate on |
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April 9, 2015, by the following vote: Yeas 31, Nays 0. |
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______________________________ |
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Secretary of the Senate |
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I hereby certify that S.B. No. 1339 passed the House on |
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May 22, 2015, by the following vote: Yeas 140, Nays 0, |
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two present not voting. |
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______________________________ |
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Chief Clerk of the House |
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Approved: |
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______________________________ |
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Date |
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______________________________ |
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Governor |