AGRICULTURE CODE
SUBTITLE H. HORTICULTURAL LIENS
CHAPTER 128. AGRICULTURAL CHEMICAL AND SEED LIENS
SUBCHAPTER A. GENERAL PROVISIONS
§ 128.001. DEFINITIONS. In this chapter:
(1) "Agricultural chemical" includes fertilizer
material as defined under Section 63.001, pesticides as defined
under Section 76.001, plant regulators as defined under Section
76.001, lime, plant and soil amendments, plant food, herbicides,
and chemical compounds that are applied to crops or to land used for
growing crops.
(2) "Agricultural seed" has the meaning assigned under
Section 61.001.
(3) "Labor" means labor or services performed in the
application, delivery, or preparation of an agricultural chemical
or agricultural seed.
(4) "Reasonable or agreed charges" means:
(A) any agreed price for agricultural chemicals,
agricultural seeds, or labor sold or provided to a lien debtor at
the lien debtor's request; or
(B) the reasonable value of agricultural
chemicals, agricultural seeds, or labor, as of the date of
application, delivery, or preparation, if there is not an agreed
price or an agreed method for determining price.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.002. PROCEEDS. (a) For the purposes of this
chapter, proceeds are the amounts received by a lien debtor, before
a deduction for taxes, fees, or assessments or a deduction made
under a court order, from the sale of:
(1) the crop that existed at the time of application on
the land of the agricultural chemical sold by the lien claimant or
applied, delivered, or prepared by the lien claimant;
(2) the first crop produced on the land after the
agricultural chemical sold by the lien claimant or applied,
delivered, or prepared by the lien claimant was applied, if crops
did not exist on the land at the time the agricultural chemical was
applied; or
(3) the crop produced from the agricultural seed
supplied by the lien claimant or applied, delivered, or prepared by
the lien claimant.
(b) For the purposes of this chapter, the following are not
included as proceeds:
(1) amounts due or owing to a cooperative association
under Chapter 51 or 52; or
(2) amounts retained by a cooperative association
under Chapter 51 or 52.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
SUBCHAPTER B. AGRICULTURAL CHEMICAL AND SEED LIEN
§ 128.006. NOTICE BEFORE PURCHASE; REQUIRED NOTICE
BEFORE CLAIMING LIEN. (a) A person claiming a lien under this
chapter must have provided notice of the provisions of this
chapter, before purchase, either generally to purchasers of
agricultural chemicals, agricultural seeds, or labor as part of the
lien claimant's normal business practices or specifically to the
lien debtor. Notice provided under this subsection must read, to
the extent applicable, substantially as follows: "The sale of
agricultural chemicals or agricultural seed on credit and the
provision of labor related to agricultural chemicals or
agricultural seed is subject to Chapter 128, Agriculture Code.
Failure to pay the agreed or reasonable charges for the chemicals,
seed, or labor may result in the attachment of a lien to the
proceeds of the agricultural products produced with the aid of the
chemicals, seed, or labor." A potential lien claimant may satisfy
the requirements of this subsection:
(1) by printing or stamping the notice on credit
applications filled out by purchasers; and
(2) for future purchases by purchasers who are not
notified on the credit application, by printing or stamping the
notice on an invoice or on a statement sent by separate cover.
(b) Before a person may claim a lien under this chapter, the
person must send to the debtor by certified mail written notice that
states:
(1) that the payment of the reasonable or agreed
charges is more than 30 days overdue;
(2) the amount that is overdue;
(3) that the debtor has the following three
alternatives:
(A) to allow the lien to be filed;
(B) to enter into an agreement granting a
security interest in the proceeds described by Section 128.002
under the Business & Commerce Code; or
(C) to pay the reasonable or agreed charges; and
(4) in at least 10-point type, that:
(A) the debtor has until the 10th day after the
date on which the notice is received to select an alternative under
Subdivision (3), notify the claimant of the alternative selected,
and satisfy all the requirements of the selected alternative; and
(B) the claimant may file the notice of claim of
lien at any time after the 10th day after the date on which the
debtor receives the notice if the debtor does not comply with the
requirements of Paragraph (A).
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.007. ATTACHMENT OF LIEN. (a) A lien established
under this chapter attaches to the proceeds described by Section
128.002.
(b) A lien established under this chapter attaches on the
first day agricultural chemicals, labor, or both are furnished to
the lien debtor. A lien that has attached under this section is
removed if the lien claimant does not satisfy the notice and filing
requirements of this chapter.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
Amended by Acts 1997, 75th Leg., ch. 292, § 1, eff. Sept. 1,
1997.
§ 128.008. AMOUNT OF LIEN. The amount of a lien under
this chapter is equal to the sum of:
(1) the amount of the unpaid reasonable or agreed
charges for:
(A) agricultural chemicals, labor, or both, as
appropriate, furnished within the 180-day period immediately
preceding the day the notice of claim of lien is filed with the
secretary of state as provided by this chapter; and
(B) agricultural seeds, labor, or both, as
appropriate, furnished within the 180-day period immediately
preceding the day the notice of claim of lien is filed with the
secretary of state as provided by this chapter; and
(2) the filing fees for the lien as provided by this
chapter.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
Amended by Acts 1997, 75th Leg., ch. 292, § 2, eff. Sept. 1,
1997.
§ 128.009. PERSON ENTITLED TO FILE;
EXCEPTION. (a) Except as provided by Subsection (b) or by Section
128.047, a person who provides an agricultural chemical,
agricultural seed, or labor may file a notice of claim of lien as
provided by this chapter.
(b) A claimant may not file a notice of claim of lien if the
settlement of a dispute between the claimant and the debtor has been
submitted to the department and is pending.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
Amended by Acts 1997, 75th Leg., ch. 292, § 3, eff. Sept. 1,
1997.
§ 128.010. PERFECTION OF LIEN. A lien created under
this chapter is perfected on the filing of a notice of claim of lien
with the secretary of state as provided by this chapter.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.011. DURATION OF NOTICE OF CLAIM OF
LIEN. (a) Except as otherwise provided by this chapter, the
notice of claim of lien is effective, and a new notice of claim of
lien is not required to maintain the lien, as long as the person who
provides the agricultural chemical, agricultural seed, or labor
either:
(1) remains unpaid for the amount secured by the lien;
or
(2) continues to provide an agricultural chemical,
agricultural seed, or labor on a regular basis to the lien debtor.
(b) For purposes of this section, providing an agricultural
chemical, agricultural seed, or labor is not considered to be made
on a regular basis if a period of more than 45 days elapses between
applications, deliveries, or preparations.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.012. PROCEDURES FOR SETTLEMENT OF
DISPUTES. (a) The commissioner of agriculture by rule shall
establish a procedure to settle a dispute between a claimant
supplying agricultural chemicals or labor in the application,
delivery, or preparation of agricultural chemicals and a debtor.
The procedures must provide:
(1) a time requirement for submitting the dispute to
the department;
(2) a time requirement within which a notice of the
dispute must be submitted to each party; and
(3) a process for evaluating the dispute.
(b) Each party to the dispute is equally liable for the
reasonable costs incurred by the department in carrying out this
section.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.013. CONTENTS OF NOTICE OF CLAIM OF LIEN. The
notice of claim of lien must include:
(1) the name and address of the lien claimant;
(2) the name and address of the lien debtor;
(3) the location of the property to which the
agricultural chemical, agricultural seed, or labor was provided;
(4) a statement that the payment of the reasonable or
agreed charges is more than 30 days overdue;
(5) the amount that is overdue;
(6) a statement, signed under penalty of perjury,
that:
(A) the lien claimant provided notice of the
provisions of this chapter, before purchase, either generally to
purchasers of agricultural chemicals, agricultural seeds, or labor
as part of the lien claimant's normal business practices or
specifically to the lien debtor, in the manner required by Section
128.006(a);
(B) the lien claimant sent to the lien debtor the
notice required by Section 128.006(b);
(C) more than 10 days have elapsed since the date
on which the notice was received by the lien debtor; and
(D) the lien debtor has not complied with the
requirements of an alternative set out by Section 128.006(b); and
(7) a statement that the lien claimant has an
agricultural chemical or agricultural seed lien under this chapter.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.014. SIGNATURE. The notice of claim of lien shall
be signed by the lien claimant or by a person authorized to sign
documents of a similar kind on behalf of the claimant.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.015. FORM. (a) The notice of claim of lien must
be filed on a form that satisfies the requirements of a financing
statement under Sections 9.502-9.504, Business & Commerce Code,
except that:
(1) the lien claimant may be identified either as a
lien claimant or as a secured party;
(2) the form must be signed by the lien claimant and is
not required to be signed by the lien debtor; and
(3) in the space for the description of the
collateral, the information specified in Sections 128.013(3), (4),
(5), and (7) must be entered.
(b) A separately signed statement containing the
information specified in Section 128.013(6) shall be attached to
the form required under Subsection (a).
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
Amended by Acts 1999, 76th Leg., ch. 414, § 2.01, eff. July 1,
2001.
§ 128.016. FILING AND MARKING IN OFFICE OF SECRETARY OF
STATE; FEE. (a) The notice of claim of lien shall be filed and
marked in the office of the secretary of state in the same manner as
a financing statement is filed and marked under Section 9.519,
Business & Commerce Code.
(b) The uniform fee for filing and indexing and for stamping
a copy furnished by the secured party is the same as the fee
assessed under Section 9.525, Business & Commerce Code.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
Amended by Acts 1999, 76th Leg., ch. 414, § 2.02, eff. July 1,
2001.
§ 128.017. TIME OF WRITTEN NOTICE. The lien claimant
shall provide written notice of the claim of lien to the lien debtor
not later than the 10th day after the date the notice of claim of
lien is filed with the office of the secretary of state.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.018. RECOGNITION OF NOTICE AS FINANCING
STATEMENT. The secretary of state shall recognize a notice of
claim of lien under this subchapter as a financing statement under
Subchapter E, Chapter 9, Business & Commerce Code.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
Amended by Acts 1999, 76th Leg., ch. 414, § 2.03, eff. July 1,
2001.
SUBCHAPTER C. PRIORITY OF LIEN
§ 128.026. TIME OF FILING. (a) A lien created under
this chapter has the same priority as a security interest perfected
by the filing of a financing statement on the date the notice of
claim of lien was filed.
(b) A lien created under this chapter does not have priority
over labor claims for wages and salaries for personal services that
are provided by an employee to a lien debtor in connection with the
production of agricultural products, the proceeds of which are
subject to the lien.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
SUBCHAPTER D. INFORMATION CONCERNING LIEN
§ 128.031. ISSUANCE OF CERTIFICATE TO MEMBER OF PUBLIC;
FEE. (a) A person may obtain a certificate identifying any lien
on file and any notice of claim of lien naming a particular debtor
and stating the date and time of filing of each notice and the names
and addresses of each lienholder in the certificate.
(b) The fee for a certificate under Subsection (a) shall be
established by the secretary of state in an amount necessary to
cover the cost of administering this section.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.032. COPIES OF NOTICES OF CLAIM OF LIEN AND OTHER
NOTICES; FEE. (a) A person may obtain a copy of any notice of
claim of an agricultural chemical or seed lien filed.
(b) The fee for a copy of a notice of claim of lien obtained
under Subsection (a) shall be established by the secretary of state
in an amount necessary to cover the cost of administering this
section.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
SUBCHAPTER E. ENFORCEMENT OF LIEN
§ 128.036. WRITTEN NOTICE TO SECURED CREDITORS BY LIEN
CLAIMANT. (a) A lien claimant shall provide written notice to any
secured creditor at least 30 days before the date the lien claimant
enforces a claim of lien.
(b) For purposes of this section, "secured creditor" means
any entity named as a secured party in a financing statement that is
filed regarding the debtor and that covers:
(1) a farm product, an account, or a crop subject to
the lien;
(2) a crop growing or grown on the land on which the
agricultural chemical was applied or for which the agricultural
seed was supplied; or
(3) the next crop to be grown on that land, if a crop is
not planted.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.037. FORECLOSURE IN ACTION TO RECOVER REASONABLE
OR AGREED CHARGES. The lien claimant may foreclose on a lien under
this chapter only in an action to recover the reasonable or agreed
charges.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.038. TERMINATION STATEMENT. (a) If a lien
claimant receives payment for the total amount secured by a lien
under this chapter and the lien claimant has not furnished an
agricultural chemical, agricultural seed, or labor during the
45-day period before the date on which payment is received, the lien
claimant shall file a termination statement with the secretary of
state and shall send the lien debtor a copy of the statement as
provided by this section. The statement shall state that the lien
claimant no longer claims a security interest under the notice of
claim of lien.
(b) The notice of claim of lien must be identified in the
statement under Subsection (a) by the date, names of parties to the
agreement, and file number of the original lien.
(c) If the lien claimant does not send the termination
statement required by this section before the 11th day after the
date on which the lien claimant received payment, the lien claimant
is liable to the lien debtor for actual damages suffered by the lien
debtor as a result of the failure. If the lien claimant acts in bad
faith in failing to send the statement, the lien claimant is liable
for an additional penalty of $100.
(d) The filing officer in the secretary of state's office
shall mark each termination statement with the date and time of
filing and shall index the statement under the name of the lien
debtor and under the file number of the original lien. If the
filing officer has a microfilm or other photographic record of the
lien and related filings, the filing officer may destroy the filed
notice of claim of lien at any time after receiving the termination
statement. If the filing officer does not have a photographic
record, the filing officer may destroy the filed notice of claim of
lien at any time after the first anniversary of the date on which
the filing officer received the termination statement.
(e) The uniform filing fee for filing and indexing the
termination statement is the same as the fee assessed under Section
9.525, Business & Commerce Code.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
Amended by Acts 1999, 76th Leg., ch. 414, § 2.04, eff. July 1,
2001.
§ 128.039. RIGHT OF ASSIGNMENT OR TRANSFER; FILING OF
STATEMENT. (a) A lien created under this chapter may be assigned
by the holder of the lien, with full rights of enforcement.
(b) The lienholder shall file a statement of assignment with
the secretary of state as provided by Section 9.514, Business &
Commerce Code.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
Amended by Acts 1999, 76th Leg., ch. 414, § 2.05, eff. July 1,
2001.
SUBCHAPTER F. MISCELLANEOUS
§ 128.046. RULES. The secretary of state may adopt
rules necessary to carry out the secretary's duties under this
chapter, including prescribing necessary forms.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.047. MAXIMUM NUMBER OF LIENS. Not more than four
liens may be enforced under this chapter against the same proceeds
of a lien debtor even if the liens are filed by different lien
claimants.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
§ 128.048. APPLICABILITY OF OTHER LAW. Chapter 9,
Business & Commerce Code, applies to a lien created under this
chapter to the extent Chapter 9 is consistent with this chapter.
Added by Acts 1995, 74th Leg., ch. 197, § 1, eff. Sept. 1, 1995.
