0001| AN ACT | 0002| RELATING TO AGRICULTURE; MAKING CHANGES IN THE PRODUCER'S LIEN ACT TO | 0003| CLARIFY ITS PROVISIONS; AMENDING, REPEALING AND ENACTING SECTIONS OF THE | 0004| NMSA 1978. | 0005| | 0006| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO: | 0007| Section 1. Section 48-5B-1 NMSA 1978 (being Laws 1995, Chapter | 0008| 157, Section 1) is amended to read: | 0009| "48-5B-1. SHORT TITLE.--Chapter 48, Article 5B NMSA 1978 may be | 0010| cited as the "Producer's Lien Act"." | 0011| Section 2. Section 48-5B-2 NMSA 1978 (being Laws 1995, Chapter | 0012| 157, Section 2) is amended to read: | 0013| "48-5B-2. DEFINITIONS.--As used in the Producer's Lien Act: | 0014| A. "department" means the New Mexico department of | 0015| agriculture; | 0016| B. "director" means the director of the department; | 0017| C. "farm product" means an unprocessed agricultural | 0018| commodity; | 0019| D. "person" means an individual or any other legal entity; | 0020| E. "process" means to treat, refine or prepare for sale, | 0021| use, transportation or marketing; | 0022| F. "processor" means a person who processes farm products; | 0023| and | 0024| G. "producer" means a person engaged in the business of | 0025| producing a farm product." | 0001| Section 3. Section 48-5B-3 NMSA 1978 (being Laws 1995, Chapter | 0002| 157, Section 3) is amended to read: | 0003| "48-5B-3. EXTENT OF LIEN--PROPERTY SUBJECT TO LIEN-- ATTACHMENT | 0004| AND PERFECTION.-- | 0005| A. Every producer that sells a farm product to a processor | 0006| under contract has a lien to be known as a "producer's lien" upon the | 0007| farm product and upon all processed or manufactured forms of the farm | 0008| product to secure payment to him for his labor, care and expense in | 0009| producing the farm product. | 0010| B. The amount of a producer's lien is the contract price for | 0011| the farm product sold. If there is no contract price, the amount of the | 0012| producer's lien is the value of the farm product on the date of delivery | 0013| to the processor. | 0014| C. A producer's lien attaches to a farm product and any | 0015| processed form of the farm product that is in the possession of the | 0016| processor. Segregation of the product is not required. For purposes of | 0017| the Producer's Lien Act, a farm product or processed form of a farm | 0018| product deposited by a processor in a warehouse, whether or not | 0019| warehouse receipts are given as security to a lender, are deemed to be | 0020| in the possession of the processor and subject to the producer's lien. | 0021| D. The producer's lien attaches from the date of delivery of | 0022| the farm product or any portion of it by a producer to a processor. | 0023| E. Unless the producer's lien is released by payment or by | 0024| security given for the payment as provided in Section 48-5B-5 NMSA 1978, | 0025| the producer's lien is perfected on the date of delivery of the farm | 0001| product or the date of the last delivery if there is a series of | 0002| deliveries. | 0003| F. The Producer's Lien Act does not change the rights and | 0004| responsibilities of financial institutions, producers or processors | 0005| pursuant to the Farm Products Secured Interest Act and the provisions of | 0006| the Uniform Commercial Code." | 0007| Section 4. Section 48-5B-5 NMSA 1978 (being Laws 1995, Chapter | 0008| 157, Section 5) is repealed and a new Section 48-5B-5 NMSA 1978 is | 0009| enacted to read: | 0010| "48-5B-5. TERMINATION OF PRODUCER'S LIEN.-- | 0011| A. A producer's lien is terminated by: | 0012| (1) payment of the full amount of the lien; | 0013| (2) the furnishing of security pursuant to the | 0014| provisions of Subsection C of this section; or | 0015| (3) execution of a written release of the lien by the | 0016| producer. | 0017| B. The effective date of a termination occurring pursuant to | 0018| Subsection A of this section is the date of payment, the date of | 0019| approval in writing of the furnishing of security or the effective date | 0020| of a written release. | 0021| C. The furnishing of acceptable security by a processor to | 0022| secure payment of the unpaid amount owed a producer by a processor | 0023| terminates the producer's lien on the farm product for which payment has | 0024| not been completed. | 0025| Security is acceptable if it is in a form and amount approved in writing | 0001| by the director pursuant to regulations adopted by the director for the | 0002| administration of the Producer's Lien Act. The amount or value of the | 0003| security shall be in an amount no less than the amount of the producer's | 0004| lien." | 0005| Section 5. Section 48-5B-6 NMSA 1978 (being Laws 1995, Chapter | 0006| 157, Section 6) is amended to read: | 0007| "48-5B-6. REMOVAL--SALE--PROCEEDS USED TO SATISFY OBLIGATIONS.--A | 0008| processor shall not remove a farm product or a processed form of the | 0009| farm product from New Mexico or from beyond his ownership or control if | 0010| it is delivered to him with a producer's lien attached. However, any of | 0011| the farm product or processed farm product that is in excess of a | 0012| quantity on hand that is of a value sufficient to satisfy all existing | 0013| liens on that product may be removed by the processor. A farm product | 0014| or a processed form of the farm product to which a producer's lien has | 0015| attached may be sold only if the total proceeds of the sale are used to | 0016| and do satisfy obligations to producers that are secured by producer's | 0017| liens." | 0018| Section 6. Section 48-5B-7 NMSA 1978 (being Laws 1995, Chapter | 0019| 157, Section 7) is amended to read: | 0020| "48-5B-7. ACCEPTANCE OF SECURITY--PAYMENT OF CLAIMS-- ACTION TO | 0021| ENFORCE PAYMENT UNDER BOND.-- | 0022| A. The director may accept security pursuant to Section 48-5B-5 NMSA 1978. If a claim secured by a producer's lien is not paid in | 0023| accordance with the condition of the security, the director may, on | 0024| proof being made to his satisfaction of the amount due a producer, pay | 0025| all the unpaid claims insofar as possible out of the security or | 0001| proceeds from a sale made by him of the security. | 0002| B. If a bond has been given as security, the director shall | 0003| notify the principal and surety of default of the principal and make | 0004| demand for payment on behalf of the unpaid producer. If payment is not | 0005| made, the director may take any available legal action to enforce | 0006| payment under the bond. | 0007| The director shall adopt regulations establishing procedures for the | 0008| sale of security made pursuant to the provisions of this section." | 0009| Section 7. Section 48-5B-9 NMSA 1978 (being Laws 1995, Chapter | 0010| 157, Section 9) is amended to read: | 0011| "48-5B-9. FORECLOSURE--RIGHT OF ACTION AGAINST PROCESSOR--EFFECT | 0012| OF PERSONAL JUDGMENT ON LIEN RIGHTS.-- | 0013| A. A producer may enforce a producer's lien by bringing a | 0014| foreclosure action in district court. A producer's lien is foreclosed | 0015| in the same manner as a mortgage. | 0016| B. The Producer's Lien Act does not impair or affect the | 0017| right of a producer having a lien from maintaining a personal action to | 0018| recover the debt against a processor, either in an action to foreclose | 0019| his lien or in a separate action. | 0020| C. A money judgment obtained by a producer in a foreclosure | 0021| action or an action to enforce the secured debt does not impair or merge | 0022| any lien right or claim held by the producer, but any money collected on | 0023| the judgment shall be credited on the amount of the producer's lien or | 0024| underlying claim in any action that is brought to enforce the lien or in | 0025| any action that is filed pursuant to the Producer's Lien Act by the | 0001| director." | 0002| Section 8. Section 48-5B-14 NMSA 1978 (being Laws 1995, Chapter | 0003| 157, Section 14) is amended to read: | 0004| "48-5B-14. DEPARTMENT DUTIES.--The department shall adopt rules | 0005| and regulations necessary to carry out the provisions of the Producer's | 0006| Lien Act, including procedures for inspecting processors' records | 0007| regarding farm products." | 0008| Section 9. A new section of the Producer's Lien Act is enacted to | 0009| read: | 0010| "SALE OF PRODUCT--REQUIREMENT FOR PROCESSOR'S STATEMENT TO BUYER | 0011| PRIOR TO DELIVERY.-- | 0012| A. Prior to the delivery of a farm product or processed farm | 0013| product to a buyer pursuant to a sale to the buyer, a processor shall | 0014| furnish the buyer a written statement made by the processor and verified | 0015| under oath stating the following: | 0016| (1) whether or not a producer's lien has attached and | 0017| exists in respect to the product being delivered, and if a lien exists, | 0018| the amount of the lien; | 0019| (2) if a lien previously attached to the product and | 0020| has been terminated prior to delivery, a description of how the lien was | 0021| terminated; and | 0022| (3) if a lien exists on the product, a statement that | 0023| the proceeds of the sale will be used to and are sufficient to satisfy | 0024| all liens attached to the product. | 0025| B. If a processor's statement furnished pursuant to | 0001| Subsection A of this section includes the information required by | 0002| Paragraph (2) of that subsection, the processor shall attach to the | 0003| statement all documents that evidence the stated termination. | 0004| C. A processor who fails to provide the statement required | 0005| by this section or who provides the statement but includes false | 0006| information in the statement shall be liable to a buyer who relies on | 0007| the statement and accepts delivery of the product or processed product | 0008| in an amount equal to twice the purchase price paid by the buyer to the | 0009| processor for the product. A buyer may enforce this right by action in | 0010| the district court." | 0011| Section 10. REPEAL.--Sections 48-5B-4, 48-5B-8 and | 0012| 48-5B-10 through 48-5B-13 NMSA 1978 (being Laws 1995, Chapter 157, | 0013| Sections 4, 8 and 10 through 13) are repealed. | 0014| | 0015| HB | 0016| 435 | 0017| Page  | 0018| |