SF 993

as introduced - 90th Legislature (2017 - 2018) Posted on 02/16/2017 09:08am

A bill for an act
relating to agriculture; modifying feeder's lien to clarify eligibility of those who
furnish feed to a livestock producer; eliminating livestock production input lien
and temporary livestock production input lien; amending Minnesota Statutes 2016,
sections 514.965, subdivision 2; 514.966, subdivisions 4, 5, 6, 8; repealing
Minnesota Statutes 2016, sections 514.965, subdivisions 8, 11; 514.966,
subdivisions 3, 3a.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2016, section 514.965, subdivision 2, is amended to read:

Subd. 2.

Agricultural lien.

"Agricultural lien" means an agricultural lien as defined in
section 336.9-102(a)(5) and includes a veterinarian's lien, breeder's lien, deleted text begin livestock production
input lien, temporary livestock production input lien, deleted text end and feeder's lien under this section
and section 514.966.

Sec. 2.

Minnesota Statutes 2016, section 514.966, subdivision 4, is amended to read:

Subd. 4.

Feeder's lien.

(a) A person has a feeder's lien on livestock if the person new text begin , in the
ordinary course of business and at the request of the owner or legal possessor of the livestock,
either:
new text end

(1) new text begin furnishes feed for livestock; or
new text end

new text begin (2) new text end stores, cares for, or contributes to the keeping, feeding, pasturing, or other care of
livestock, including medical or surgical treatment and shoeing deleted text begin , and (2) does so in the ordinary
course of business, at the request of the owner or legal possessor of the livestock deleted text end .

(b) A feeder's lien is a lien upon the livestock for the new text begin retail new text end price or value of the new text begin feed,
new text end storage, care, or contribution, and for any legal charges against the same paid by the person
to any other person.

(c) A feeder's lien becomes effective when the new text begin feed, new text end services new text begin , new text end or contributions are provided
the obligor.

Sec. 3.

Minnesota Statutes 2016, section 514.966, subdivision 5, is amended to read:

Subd. 5.

Scope.

A veterinarian's lien, breeder's lien, deleted text begin livestock production input lien,
temporary livestock production lien, deleted text end or feeder's lien attaches to the livestock serviced new text begin or
furnished feed new text end by the agricultural lienholder, and products and proceeds thereof to the extent
of the price or value of the service provided new text begin or feed furnished new text end .

Sec. 4.

Minnesota Statutes 2016, section 514.966, subdivision 6, is amended to read:

Subd. 6.

Perfection.

(a) An agricultural lien under this section is perfected if a financing
statement is filed pursuant to sections 336.9-501 to 336.9-530 and within the time periods
set forth in paragraphs (b) to deleted text begin (f) deleted text end new text begin (d) new text end .

(b) A veterinarian's lien must be perfected on or before 180 days after the last item of
the veterinary service is performed.

(c) A breeder's lien must be perfected by six months after the last date that breeding
services are provided the obligor.

deleted text begin (d) Except as provided in paragraph (f), a livestock production input lien must be
perfected by six months after the last date that livestock production inputs are furnished the
obligor.
deleted text end

deleted text begin (e) deleted text end new text begin (d) new text end A feeder's lien must be perfected on or before 60 days after the last date that new text begin feed
or new text end feeding services are furnished the obligor.

deleted text begin (f) A temporary livestock production input lien, under subdivision 3a, must be perfected
on or before 60 days after the last date that livestock production inputs are furnished the
obligor.
deleted text end

Sec. 5.

Minnesota Statutes 2016, section 514.966, subdivision 8, is amended to read:

Subd. 8.

Priority.

(a) Except as provided in paragraph (b), a perfected veterinarian's
lien under this section has priority over all competing security interests and all agricultural
liens on the same animals.

(b) If more than one veterinarian's lien is perfected under this section, the conflicting
perfected veterinarian's liens have priority in order of the effectiveness of the liens.

(c) Except as provided in paragraph (d), a perfected feeder's lien under this section has
priority over all competing security interests and all agricultural liens except a perfected
veterinarian's lien in the livestock and the products or proceeds thereof.

(d) If more than one feeder's lien is perfected under this section, the conflicting perfected
feeder's liens have priority in order of the effectiveness of the liens.

(e) A perfected breeder's lien under this section has priority over all competing security
interests and all agricultural liens except a perfected veterinarian's lien and a perfected
feeder's lien in the livestock and the products and proceeds thereof.

deleted text begin (f) Except as provided in paragraph (g), a perfected livestock production input lien under
this section has priority against all agricultural liens except a perfected veterinarian's lien,
feeder's lien, and breeder's lien in the livestock and the products or proceeds thereof.
deleted text end

deleted text begin (g) If more than one livestock production input lien is perfected under this section,
conflicting perfected livestock production input liens have priority in order of the
effectiveness of the liens.
deleted text end

deleted text begin (h) Except as provided in paragraph (i), a perfected livestock production input lien under
this section has priority against all competing security interests as provided in subdivision
3 in livestock and the products and proceeds thereof.
deleted text end

deleted text begin (i) A perfected livestock production input lien has priority over a competing security
interest in the livestock and proceeds and products thereof if the livestock production input
lien is effective before the secured party has given value to the debtor.
deleted text end

Sec. 6. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2016, sections 514.965, subdivisions 8 and 11; and 514.966,
subdivisions 3 and 3a, new text end new text begin are repealed.
new text end

Sec. 7. new text begin EFFECTIVE DATE.
new text end

new text begin This act is effective August 1, 2017, and applies to agricultural liens perfected on or
after that date.
new text end

APPENDIX

Repealed Minnesota Statutes: 17-2560

514.965 LIVESTOCK LIEN DEFINITIONS.

Subd. 8.

Livestock production input.

"Livestock production input" means feed and labor used in raising livestock.

Subd. 11.

Supplier.

"Supplier" means a person furnishing agricultural production inputs.

514.966 AGRICULTURAL LIEN ON LIVESTOCK.

Subd. 3.

Livestock production input lien.

(a) A supplier furnishing livestock production inputs in the ordinary course of business has a livestock production input lien for the unpaid retail cost of the livestock production input. A perfected livestock production input lien that attaches to livestock may not exceed the amount, if any, that the sales price of the livestock exceeds the greater of the fair market value of the livestock at the time the lien attaches or the acquisition price of the livestock. A livestock production input lien becomes effective when the agricultural production inputs are furnished by the supplier to the purchaser.

(b) A supplier shall notify a lender of a livestock production input lien by providing a lien-notification statement to the lender in an envelope marked "IMPORTANT-LEGAL NOTICE." Delivery of the notice must be made by certified mail or another verifiable method.

(c) The lien-notification statement must disclose the following:

(1) the name and business address of the lender that is to receive notification;

(2) the name and address of the supplier claiming the lien;

(3) a description and the date or anticipated date or dates of the transaction and the retail cost or anticipated costs of the livestock production input;

(4) the name and address of the person to whom the livestock production input was furnished;

(5) the name and address of the owner of the livestock, the location where the livestock will be raised, and a description of the livestock; and

(6) a statement that products and proceeds of the livestock are covered by the livestock input lien.

(d) Within ten calendar days after receiving a lien-notification statement, the lender must respond to the supplier with either:

(1) a letter of commitment for part or all of the amount in the lien-notification statement; or

(2) a written refusal to issue a letter of commitment.

A copy of the response must be mailed to the person for whom the financing was requested.

(e) If a lender responds with a letter of commitment for part or all of the amount in the lien-notification statement, the supplier may not obtain a lien for the amount stated in the letter of commitment. If a lender responds with a refusal to provide a letter of commitment, the rights of the lender and the supplier are not affected.

(f) If a lender does not respond under paragraph (d) to the supplier within ten calendar days after receiving the lien-notification statement, a perfected livestock production input lien corresponding to the lien-notification statement has priority over any security interest of the lender in the same livestock or their proceeds for the lesser of:

(1) the amount stated in the lien-notification statement; or

(2) the unpaid retail cost of the livestock production input identified in the lien-notification statement, subject to any limitation in paragraph (a).

Subd. 3a.

Temporary livestock production input lien; debtor in mediation.

(a) A supplier furnishing livestock production inputs in the ordinary course of business to a debtor who has filed a mediation request under chapter 583 has a temporary livestock production input lien for the unpaid retail cost of the livestock production input. A perfected temporary livestock production input lien that attaches to livestock may not exceed the amount, if any, that the sales price of the livestock for which the inputs were received exceeds the greater of the fair market value of the livestock at the time the lien attaches or the acquisition price of the livestock. A temporary livestock production input lien becomes effective when the agricultural production inputs are furnished by the supplier to the purchaser.

(b) A temporary livestock production input lien under this subdivision applies to livestock production inputs provided to the debtor during the 45 days following a mediation request under chapter 583.

(c) A person who supplies livestock production inputs under this subdivision shall provide a lien-notification statement as required under subdivision 3, paragraphs (b) and (c), but is not subject to subdivision 3, paragraphs (d) to (f). A perfected temporary livestock production input lien corresponding to the lien-notification statement has priority over any security interest of the lender in the same livestock or their proceeds for the lesser of:

(1) the amount stated in the lien-notification statement; or

(2) the unpaid retail cost of the livestock production input identified in the lien-notification statement, subject to any limitation in paragraph (a).