Minnesota Session Laws - 2001, Regular Session

                             CHAPTER 57-H.F.No. 285 
                  An act relating to liens; regulating agricultural 
                  liens; revising and consolidating crop liens and 
                  agricultural liens on livestock; amending Minnesota 
                  Statutes 2000, section 514.19; proposing coding for 
                  new law in Minnesota Statutes, chapter 514; repealing 
                  Minnesota Statutes 2000, sections 514.23; 514.24; 
                  514.25; 514.26; 514.27; 514.28; 514.29; 514.30; 
                  514.31; 514.32; 514.33; 514.34; 514.62; 514.63; 
                  514.65; 514.66; 514.92; 514.950; 514.952; 514.954; 
                  514.956; 514.958; 514.959; 514.960; 557.12; and 
                  559.2091; Minnesota Rules, parts 8271.0010; 8271.0020; 
                  8271.0030; 8271.0040; 8271.0050; 8271.0060; 8271.0070; 
                  8271.0080; 8271.0090; 8271.0100; 8271.0200; 8271.0300; 
                  and 8271.0350. 
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  Minnesota Statutes 2000, section 514.19, is 
        amended to read: 
           514.19 [RIGHT OF DETAINER.] 
           A lien and right of detainer exists for: 
           (1) transporting property, other than harvested crops or 
        livestock, from one place to another but not as a carrier under 
        article 7 of the Uniform Commercial Code; 
           (2) keeping or storing property, other than harvested crops 
        or livestock, as a bailee but not as a warehouse operator under 
        article 7 of the Uniform Commercial Code; 
           (3) Keeping, feeding, pasturing, or otherwise caring for 
        domestic animals or other beasts, including medical or surgical 
        treatment and shoeing; 
           (4) the use and storage of molds and patterns in the 
        possession of the fabricator belonging to the customer for the 
        balance due from the customer for fabrication work; 
           (5) (4) making, altering or repairing any article, other 
        than livestock, or expending any labor, skill or material on it; 
           (6) (5) reasonable charges for a vehicle rented as a 
        replacement for a vehicle serviced or repaired and being 
        retained as provided by this section. 
           The liens embrace all lawful charges against the property 
        paid to any other person by the person claiming the lien, and 
        the price or value of the care, storage or contribution and all 
        reasonable disbursements occasioned by the detention or sale of 
        the property. 
           Sec. 2.  [514.963] [CROP LIEN DEFINITIONS.] 
           Subdivision 1.  [SCOPE.] For the purposes of this section 
        and section 514.964, the terms defined in subdivisions 2 to 12 
        have the meanings given them. 
           Subd. 2.  [AGRICULTURAL CHEMICAL.] "Agricultural chemical" 
        means fertilizers or agricultural chemicals that are applied to 
        crops or to land used for raising crops, including fertilizer 
        material, plant amendment, plant food.  The term includes a soil 
        amendment as defined in section 18C.005, and a pesticide and a 
        plant regulator as defined in section 18B.01. 
           Subd. 3.  [AGRICULTURAL LIEN.] "Agricultural lien" means an 
        agricultural lien as defined by section 336.9-102(a)(5), and 
        includes a landlord's lien, harvester's lien, and crop 
        production input lien under this section. 
           Subd. 4.  [AGRICULTURAL LIENHOLDER.] "Agricultural 
        lienholder" means a person holding an agricultural lien. 
           Subd. 5.  [CROP PRODUCTION INPUT.] "Crop production input" 
        means agricultural chemicals, seeds, petroleum products, the 
        custom application of agricultural chemicals and seeds, and 
        labor used in preparing the land for planting, cultivating, 
        growing, producing, harvesting, drying, and storing crops or 
        crop products. 
           Subd. 6.  [FARM PRODUCTS.] "Farm products" means farm 
        products as defined in section 336.9-102(a)(34). 
           Subd. 7.  [LENDER.] "Lender" means a secured party as 
        defined in section 336.9-102(a)(72), holding a perfected 
        security interest in the farm products of the obligor. 
           Subd. 8.  [OBLIGOR.] "Obligor" means obligor as defined in 
        section 336.9-102(a)(59). 
           Subd. 9.  [PERSON.] "Person" means an individual or an 
        organization as defined in section 336.1-201(30). 
           Subd. 10.  [PETROLEUM PRODUCTS.] "Petroleum products" means 
        motor fuels and special fuels used in the production of crops 
        and livestock, including petroleum products as defined in 
        section 296A.01, and alcohol fuels, propane, lubes, and oils. 
           Subd. 11.  [SEED.] "Seed" means agricultural seeds used to 
        produce crops, including agricultural seeds defined in section 
        21.72. 
           Subd. 12.  [SUPPLIER.] "Supplier" means a person furnishing 
        crop production inputs. 
           Sec. 3.  [514.964] [AGRICULTURAL LIEN ON CROPS.] 
           Subdivision 1.  [LANDLORD'S LIEN.] A person leasing real 
        property for agricultural production has a lien for unpaid rent 
        on the crops produced on the real property in the crop year that 
        is the subject of the lease.  A landlord's lien becomes 
        effective when the crops become growing crops. 
           Subd. 2.  [HARVESTER'S LIEN.] (a) A person providing 
        combining, picking, harvesting, hauling, baling, drying, or 
        storing services in the ordinary course of business has a lien 
        upon the crops combined, picked, harvested, hauled, baled, 
        dried, or stored, as the case may be, for the reasonable amount 
        and kind of service provided.  
           (b) A harvester's lien becomes effective upon the services 
        being provided the obligor by the harvester.  
           (c) A person asserting a harvester's lien may not assert a 
        crop production input lien for the same goods or services 
        provided the obligor. 
           Subd. 3.  [CROP PRODUCTION INPUT LIEN.] (a) A supplier 
        furnishing crop production inputs in the ordinary course of 
        business has an agricultural lien for the unpaid retail cost of 
        the crop production inputs.  The lien attaches to: 
           (1) the existing crops upon the land where a furnished 
        agricultural chemical was applied, or if crops are not planted, 
        to the next production crop within 16 months following the last 
        date on which the agricultural chemical was applied; 
           (2) the crops produced from furnished seed; or 
           (3) the crops produced, harvested, or processed using a 
        furnished petroleum product. 
           If the crops are grown on leased land and the lease 
        provides for payment in crops, the lien does not attach to the 
        lessor's portion of the crops.  A crop production input lien 
        becomes effective when the crop production inputs are furnished 
        by the supplier to the purchaser. 
           (b) A supplier shall notify a lender of a crop 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 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 crop production input; 
           (4) the name and address of the person to whom the crop 
        production input was furnished; and 
           (5) the name and address of the owner.  
           (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 retail 
        cost or anticipated costs of the crop production input as set 
        forth in the lien-notification statement; or 
           (2) a written refusal to issue a letter of commitment. 
           A copy of the lender's response must be provided 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 crop production input 
        lien corresponding to the lien-notification statement has 
        priority over any security interest of the lender in the same 
        crops or their proceeds for the lesser of: 
           (1) the amount stated in the lien-notification statement; 
        or 
           (2) the unpaid retail cost of the crop production input 
        identified in the lien-notification statement. 
           Subd. 4.  [SCOPE.] A landlord's lien, harvester's lien, or 
        crop production input lien attaches to the crops serviced, 
        produced, or harvested by the agricultural lienholder, and the 
        products and proceeds thereof to the extent of the price or 
        value of the goods or services provided. 
           Subd. 5.  [PERFECTION.] (a) A landlord's lien, harvester's 
        lien, or crop production input 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 (d). 
           (b) A landlord's lien must be perfected on or before 30 
        days after the crops become growing crops. 
           (c) A harvester's lien must be perfected on or before 15 
        days after the last date that harvesting services are provided 
        the obligor. 
           (d) A crop production input lien must be perfected by six 
        months after the last date that crop production inputs are 
        furnished the obligor. 
           Subd. 6.  [GOVERNING LAW.] Except as otherwise provided in 
        this section, an agricultural lien is subject to the provisions 
        of the Uniform Commercial Code - Secured Transactions, sections 
        336.9-101 to 336.9-709. 
           Subd. 7.  [PRIORITY.] (a) A perfected landlord's lien under 
        this section has priority over all competing security interests 
        and all agricultural liens in crops and the products or proceeds 
        thereof.  
           (b) Except as provided in paragraph (c), a perfected 
        harvester's lien under this section has priority over all 
        competing security interests and all agricultural liens except a 
        perfected landlord's lien in crops and the products or proceeds 
        thereof, and except for a perfected crop production input lien 
        for the reasonable cost of the seed in crops and products and 
        the proceeds thereof. 
           (c) If more than one harvester's lien is perfected under 
        this section, the conflicting perfected harvester's liens rank 
        equally in proportion to the value of the service provided. 
           (d) Except as provided in paragraph (e), a perfected crop 
        production lien under this section has priority against all 
        competing agricultural liens except a perfected landlord's lien 
        and a perfected harvester's lien in the crops and products or 
        proceeds thereof. 
           (e) If more than one crop production input lien is 
        perfected under this section, conflicting perfected crop 
        production input liens have priority in order of the 
        effectiveness of the liens. 
           (f) Except as provided in paragraph (g), a perfected crop 
        production input lien under this section has priority against 
        all competing security interest as provided in subdivision 3 in 
        crops and the products and proceeds thereof. 
           (g) A perfected crop production input lien has priority 
        over a competing security interest in the crops and proceeds and 
        products thereof if the crop production input lien is effective 
        before the secured party has given value to the debtor. 
           Subd. 8.  [DEFAULT.] Default occurs when an obligor fails 
        to perform any obligation, whether written or oral, owed to the 
        agricultural lienholder. 
           Subd. 9.  [ENFORCEMENT.] The holder of an agricultural lien 
        under this section may enforce the lien in the manner provided 
        in sections 336.9-601 to 336.9-628.  
           Sec. 4.  [514.965] [LIVESTOCK LIEN DEFINITIONS.] 
           Subdivision 1.  [SCOPE.] For the purposes of this section 
        and section 514.966, the terms defined in subdivisions 2 to 11 
        have the meanings given them. 
           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, livestock 
        production input lien, and feeder's lien under this section. 
           Subd. 3.  [AGRICULTURAL LIENHOLDER.] "Agricultural 
        lienholder" means a person holding an agricultural lien. 
           Subd. 4.  [EMERGENCY VETERINARY SERVICES.] "Emergency 
        veterinary services" includes surgical procedures, administering 
        vaccines, antisera, and antibiotics, and other veterinary 
        medicines, treatments, and services performed primarily to 
        protect human health, prevent the spread of animal diseases, or 
        preserve the health of the animal or animals treated. 
           Subd. 5.  [FARM PRODUCTS.] "Farm products" means farm 
        products as defined in section 336.9-102(a)(34). 
           Subd. 6.  [FEED.] "Feed" means commercial feeds, feed 
        ingredients, mineral feeds, drugs, animal health products, or 
        customer-formula feeds used for feeding livestock, including 
        commercial feed as defined in section 25.33. 
           Subd. 7.  [LENDER.] "Lender" means a secured party as 
        defined in section 336.9-102(a)(72) holding a perfected security 
        interest in the farm products of the obligor. 
           Subd. 8.  [LIVESTOCK PRODUCTION INPUT.] "Livestock 
        production input" means feed and labor used in raising livestock.
           Subd. 9.  [OBLIGOR.] "Obligor" means an obligor as defined 
        in section 336.9-102(a)(59). 
           Subd. 10.  [PERSON.] "Person" means an individual or an 
        organization as defined in section 336.1-201(30). 
           Subd. 11.  [SUPPLIER.] "Supplier" means a person furnishing 
        agricultural production inputs. 
           Sec. 5.  [514.966] [AGRICULTURAL LIEN ON LIVESTOCK.] 
           Subdivision 1.  [VETERINARIAN'S LIEN.] A licensed 
        veterinarian performing emergency veterinary services in the 
        ordinary course of business that cost more than $25 for animals 
        at the request of the owner or a person in possession of the 
        animals has a lien on the animals for the value of the 
        services.  A lien under this section does not secure any 
        veterinary services performed more than one year before the date 
        on which the last item of the veterinary service is performed.  
        A veterinarian's lien becomes effective upon the services being 
        provided the obligor by the veterinarian. 
           Subd. 2.  [BREEDER'S LIEN.] The owner of any livestock used 
        for breeding services in the ordinary course of business, or any 
        provider, in the ordinary course of business, of semen or ova 
        used in fertilizer, artificial insemination, or any other 
        artificial means of impregnating livestock, has a lien upon the 
        livestock bred and any resulting offspring for the price or 
        value of the service provided.  A breeder's lien becomes 
        effective when the services are provided the obligor by the 
        breeder. 
           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 be in a form 
        approved by the secretary of state and 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, residential address, and signature of the 
        person to whom the livestock production input was furnished; 
           (5) the name and residential 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. 4.  [FEEDER'S LIEN.] (a) A person has a feeder's lien 
        on livestock if the person (1) stores, cares for, or contributes 
        to the keeping, feeding, pasturing, or other care of livestock, 
        including medical or surgical treatment and shoeing, and (2) 
        does so in the ordinary course of business, at the request of 
        the owner or legal possessor of the livestock. 
           (b) A feeder's lien is a lien upon the livestock for the 
        price or value of the 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 services or 
        contributions are provided the obligor. 
           Subd. 5.  [SCOPE.] A veterinarian's lien, breeder's lien, 
        livestock production input lien, or feeder's lien attaches to 
        the livestock serviced by the agricultural lienholder, and 
        products and proceeds thereof to the extent of the price or 
        value of the service provided. 
           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 (e). 
           (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. 
           (d) A livestock production input lien must be perfected by 
        six months after the last date that livestock production inputs 
        are furnished the obligor. 
           (e) A feeder's lien must be perfected on or before 60 days 
        after the last date that feeding services are furnished the 
        obligor. 
           Subd. 7.  [GOVERNING LAW.] Except as otherwise provided in 
        this section, an agricultural lien is subject to the provisions 
        of the Uniform Commercial Code - Secured Transactions, sections 
        336.9-101 to 336.9-709. 
           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. 
           (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. 
           (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. 
           (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.
           (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. 
           Subd. 9.  [DEFAULT.] Default occurs when an obligor fails 
        to perform any obligation, whether written or oral, owed to the 
        agricultural lienholder. 
           Subd. 10.  [ENFORCEMENT.] The holder of an agricultural 
        lien under this section may enforce the lien in the manner 
        provided in sections 336.9-601 to 336.9-628. 
           Sec. 6.  [TRANSITION RULE FOR LIVESTOCK AND CROP STATUTES.] 
           (a) Agricultural liens in crops or livestock or the 
        products or proceeds thereof created before July 1, 2001, based 
        on statutes repealed by this act, or based on Minnesota 
        Statutes, section 514.19, prior to its amendment by this act, 
        remain in effect for the duration provided by the law in effect 
        before July 1, 2001. 
           (b) Lien statements properly filed prior to July 1, 2001, 
        under statutes repealed by this act remain effective for the 
        period of time allowed under those statutes. 
           (c) Records of agricultural liens based upon statutes 
        repealed by this act will exist in the central filing system 
        operated by the office of the secretary of state. 
           Sec. 7.  [REPEALER.] 
           (a) Minnesota Statutes 2000, sections 514.23; 514.24; 
        514.25; 514.26; 514.27; 514.28; 514.29; 514.30; 514.31; 514.32; 
        514.33; 514.34; 514.62; 514.63; 514.65; 514.66; 514.92; 514.950; 
        514.952; 514.954; 514.956; 514.958; 514.959; 514.960; 557.12; 
        and 559.2091, are repealed. 
           (b) Minnesota Rules, parts 8271.0010; 8271.0020; 8271.0030; 
        8271.0040; 8271.0050; 8271.0060; 8271.0070; 8271.0080; 
        8271.0090; 8271.0100; 8271.0200; 8271.0300; and 8271.0350, are 
        repealed. 
           Sec. 8.  [EFFECTIVE DATE.] 
           Sections 1 to 7 are effective July 1, 2001. 
           Presented to the governor April 26, 2001 
           Signed by the governor April 30, 2001, 3:02 p.m.