Bill Text: IN HB1230 | 2010 | Regular Session | Introduced
Bill Title: Grain buyers and grain indemnity program; seeds.
Spectrum: Bipartisan Bill
Status: (Passed) 2010-03-25 - Section 35 effective 03/17/2010 [HB1230 Detail]
Download: Indiana-2010-HB1230-Introduced.html
Citations Affected: IC 26-3-7; IC 26-4.
Effective: July 1, 2010.
January 11, 2010, read first time and referred to Committee on Agriculture and Rural
Development.
Digest Continued
incurred a financial loss due to the failure of a grain
buyer is entitled,
the compensable part of the claimant's loss is to be reduced by all
credits and offsets and any producer premium that should have been
due on the sale of the grain. Repeals provisions: (1) defining a "valid
claim"; (2) concerning a grain buyer's registration with the board of the
grain indemnity corporation; (3) authorizing inspection of the books
and records of a registered grain buyer to confirm compliance with the
law; (4) excluding a producer from protection under the grain
indemnity program under certain circumstances; and (5) providing that
the claim of a claimant who incurred a storage loss due to the failure of
a warehouse operator is valid only if brought within one year after
publication of notice of the grain buyer's failure.
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in
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A BILL FOR AN ACT to amend the Indiana Code concerning
agriculture and animals.
(1) "Agency" refers to the Indiana grain buyers and warehouse licensing agency established under section 1 of this chapter.
(2) "Anniversary date" means the date that is ninety (90) calendar days after the fiscal year end of a business licensed under this chapter.
(3) "Bin" means a bin, tank, interstice, or other container in a warehouse in which bulk grain may be stored.
(4) "Buyer-warehouse" means a person that operates both as a warehouse licensed under this chapter and as a grain buyer.
(5) "Claimant" means a person that is unable to secure satisfaction within the twelve (12) months following delivery of the
financial obligations due from a licensee under this chapter for
grain that has been delivered to the licensee for sale or for storage
under a bailment.
(6) "Deferred pricing" or "price later" means a purchase by a
buyer in which title to the grain passes to the buyer and the price
to be paid to the seller is not determined:
(A) at the time the grain is received by the buyer; or
(B) within ten (10) less than twenty-one (21) days of receipt.
after delivery.
(7) "Delayed payment" means a purchase by a buyer in which
title to the grain passes to the buyer at a determined price and
payment to the seller is not made in less than twenty-one (21)
days after delivery.
(7) (8) "Depositor" means any of the following:
(A) A person that delivers grain to a licensee under this
chapter for storage or sale.
(B) A person that:
(i) owns or is the legal holder of a ticket or receipt issued by
a licensee for grain received by the licensee; and
(ii) is the creditor of the issuing licensee for the value of the
grain received in return for the ticket or receipt.
(C) A licensee that stores grain that the licensee owns solely,
jointly, or in common with others in a warehouse owned or
controlled by the licensee or another licensee.
(8) (9) "Designated representative" means the person or persons
designated by the director to act instead of the director in assisting
in the administration of this chapter.
(9) (10) "Director" means the director of the Indiana grain buyers
and warehouse licensing agency appointed under section 1 of this
chapter.
(10) (11) "Facility" means a location or one (1) of several
locations in Indiana that are operated as a warehouse or by a grain
buyer.
(11) (12) "Failure" "Failed" or "failure" means any of the
following:
(A) The inability of a licensee to financially satisfy fully all
obligations due to claimants.
(B) Public declaration of a licensee's insolvency.
(C) Revocation or suspension of a licensee's license, if the
licensee has outstanding indebtedness owed to claimants.
(D) Nonpayment of a licensee's debts in the ordinary course of
business, if there is not a good faith dispute.
(E) Voluntary surrender of a licensee's license, if the licensee has outstanding indebtedness to claimants.
(F) Involuntary or voluntary bankruptcy of a licensee.
(A) All grain owned or stored by a licensee, including grain that:
(i) is in transit following shipment by a licensee; and
(ii) has not been paid for.
(B) All proceeds, due or to become due, from the sale of a licensee's grain.
(C) Equity, less any secured financing directly associated with the equity, in hedging or speculative margin accounts of a licensee held by a commodity or security exchange, or a dealer representing a commodity or security exchange, and any money due the licensee from transactions on the exchange, less any secured financing directly associated with the money due the licensee from the transactions on the exchange.
(D) Any other unencumbered funds, property, or equity in funds or property, wherever located, that can be directly traced to the sale of grain by a licensee. However, funds, property, or equity in funds or property may not be considered encumbered unless:
(i) the encumbrance results from valuable consideration paid to the licensee in good faith by a secured party; and
(ii) the encumbrance did not result from the licensee posting the funds, property, or equity in funds or property as additional collateral for an antecedent debt.
(E) Any other unencumbered funds, property, or equity in assets of the licensee.
(A) stored for hire;
(B) used for grain bank storage; or
(C) used to store company owned grain;
and the building or other protected enclosure is operated under one (1) ownership and run from a single office.
(1) Require any reports that are necessary to administer this
chapter.
(2) Administer oaths, issue subpoenas, compel the attendance and
testimony of witnesses, and compel the production of records in
connection with any investigation or hearing under this chapter.
(3) Prescribe all forms within the provisions of this chapter.
(4) Establish grain standards in accordance with the grain
standards act and federal regulations promulgated under that act
that must be used by warehouses.
(5) Investigate the activities required by this chapter including the
storage, shipping, marketing, and handling of grain and
complaints with respect to the storage, shipping, marketing, and
handling of grain.
(6) Inspect a facility, the grain stored in a facility, and all property
and records pertaining to a facility. All inspections of an applicant
or licensee under this chapter must take into consideration the
proprietary nature of an applicant's or licensee's commercial
information. The director may adopt rules under IC 4-22-2
regarding inspections permitted under this chapter, and the rules
must take into consideration the proprietary nature of an
applicant's or a licensee's commercial information. This chapter
does not authorize the inspection of an applicant's or licensee's
trade secret or intellectual property information.
(7) Determine whether a facility for which a license has been
applied for or has been issued is suitable for the proper storage,
shipping, and handling of the grain that is stored, shipped, or
handled, or is expected to be stored, shipped, or handled.
(8) Require a licensee to terminate storage, shipping, marketing,
and handling agreements upon revocation of the person's license.
(9) Attend and preside over any investigation or hearing allowed
or required under this chapter.
(10) Impose sanctions for violations of this article.
(11) Require a grain buyer and all persons purchasing grain to
show evidence of training or licensing on the risks associated with
grain marketing practices only if a grain buyer engages in a risk
factor higher than a standard defined by the director. This training
or licensing may include requiring the grain buyer or person
purchasing grain to do any of the following:
(A) Provide the agency with proof of registry with the
commodity futures trading commission (CFTC) as a
commodity trading adviser, a futures commission merchant, an
introducing broker, or an associated person.
(B) Demonstrate passage of the series 3 examination
administered by the National Association of Security Dealers.
(C) Annually attend six (6) hours of continuing education,
approved by the director, focusing on the risks to a grain buyer
and seller that are associated with grain marketing practices
and the communication of risks to the producer. Additionally,
as part of continuing education, require a grain buyer, and all
persons purchasing grain for a grain buyer, to pass a test,
approved and administered by the director, that reasonably
measures the grain buyer's understanding of the risks to grain
buyers and sellers associated with producer marketing
strategies.
(12) Require all contracts executed after June 30, 1997, for the
purchase of grain from producers, except a flat price contract or
a contract for the production of seed, to include the following
notice immediately above the place on the contract where the
seller of the grain must sign:
"NOTICE - SELLER IS CAUTIONED THAT
CONTRACTING FOR THE SALE AND DELIVERY OF
GRAIN INVOLVES RISKS. THESE RISKS MAY INCLUDE
FUTURE PAYMENTS BY YOU TO MAINTAIN THIS
CONTRACT, A LOWER SALES PRICE, AND OTHER
RISKS NOT SPECIFIED.
COVERAGE UNDER THE INDIANA GRAIN INDEMNITY
PROGRAM IS LIMITED TO 100% OF A LOSS FOR
STORED GRAIN AND 80% OF A LOSS FOR OTHER
COVERED CONTRACTS.
BE SURE YOU UNDERSTAND THE NATURE OF THIS
CONTRACT AND THE ASSOCIATED RISKS."
(13) Require all contracts executed after January 1, 2000, for the
production of seed to include the following notice, in conspicuous
letters, immediately above the place on the contract or an
addendum where the seller of the seed must sign:
"NOTICE - IF THE TERMS OF THIS CONTRACT STATE
THAT THE CONTRACTOR RETAINS OWNERSHIP OF
THE SEED AND ITS PRODUCTS, YOU MAY NOT BE
ELIGIBLE FOR PARTICIPATION IN THE INDIANA
GRAIN INDEMNITY PROGRAM. TO BE ELIGIBLE TO
PARTICIPATE IN THE INDIANA GRAIN INDEMNITY
PROGRAM, FARMERS MUST OWN AND SELL GRAIN
OR SEED. BE SURE YOU UNDERSTAND THE NATURE
OF THIS CONTRACT AND THE ASSOCIATED RISKS."
(14) At any time, order an unannounced audit for compliance with
this article.
(15) Adopt rules under IC 4-22-2 to carry out the purposes and
intent of this chapter.
(16) Require all grain buyers offering deferred pricing,
delayed payments, or contracts linked to the commodity
futures or commodity options market in connection with a
grain purchase to document the agreement in writing not
more than twenty-one (21) days after delivery.
(b) The director shall do the following:
(1) Establish standards to ensure that a grain buyer has a suitable
financial position to conduct a business as a grain buyer.
(2) Require a person who conducts business as a grain buyer to
first be licensed by the agency.
(3) Require any person engaged in the business of advising
producers on grain marketing for hire to:
(A) register with the agency; and
(B) provide the agency with proof of registry with the
commodity futures trading commission (CFTC) as a
commodity trading advisor, a futures commission merchant, an
introducing broker, or an associated person.
(c) The director may designate an employee to act for the director
in the administration of this chapter. A designee may not:
(1) act in matters that require a public hearing or the temporary
suspension of a license;
(2) adopt rules; or
(3) act as the ultimate authority in the administration of this
chapter.
(d) The director may determine whether geographically separate
facilities constitute a single warehouse or grain buyer and in making
the determination may consider the following:
(1) The number of facilities involved.
(2) Whether full weighing equipment is present at the
geographically separate facilities.
(3) The method of bookkeeping employed by the separate
facilities.
(4) The hours of operation of the separate facilities.
(5) The personnel employed at the separate facilities.
(6) Other factors the director deems relevant.
(1) A grain bank license may be issued to a person that:
(A) stores only grain bank grain;
(B) has a storage capacity of not more than fifty thousand (50,000) bushels of grain; and
(C) purchases less than fifty thousand (50,000) bushels of grain per year.
(2) A warehouse license may be issued to a person that:
(A) stores grain for hire; and
(B) purchases less than fifty thousand (50,000) bushels of grain per year.
(3) A grain buyer license may be issued to a person that:
(A) purchases annually at least fifty thousand (50,000) bushels of grain that are not for the sole purpose of feeding the person's own livestock or poultry;
(B)
(C) offers deferred pricing, delayed payments, or contracts linked to the commodity futures or commodity options market in connection with grain purchases.
(4) A buyer-warehouse license may be issued to a person that operates both as a warehouse and as a grain buyer.
(b) An applicant shall file with the director a separate application for each license or amendment of a license at the times, on the forms, and containing the information that the director prescribes.
(c) An initial application for a license must be accompanied by a license fee as follows:
(1) For a grain bank or for a warehouse or buyer-warehouse with a storage capacity of less than two hundred fifty thousand (250,000) bushels, two hundred fifty dollars ($250) for the first facility and fifty dollars ($50) for each additional facility.
(2) For a warehouse or a buyer-warehouse with a storage capacity of at least two hundred fifty thousand (250,000) bushels but less than one million (1,000,000) bushels, five hundred dollars ($500) for the first facility and fifty dollars ($50) for each additional facility.
(3) For a warehouse or a buyer-warehouse with a storage capacity of at least one million (1,000,000) bushels but less than ten million (10,000,000) bushels, seven hundred fifty dollars ($750) for the first facility and fifty dollars ($50) for each additional facility.
(4) For a warehouse or buyer-warehouse with a storage capacity greater than ten million (10,000,000) bushels, one thousand
dollars ($1,000) for the first facility and fifty dollars ($50) for
each additional facility.
(5) For a grain buyer, including a grain buyer that is also licensed
as a warehouse under the warehouse act, five hundred dollars
($500) for the first facility and fifty dollars ($50) for each
additional facility.
The director may prorate the initial application fee for a license that is
issued at least thirty (30) days after the anniversary date of the
licensee's business.
(d) Before the anniversary date of the license, the licensee shall pay
an annual fee in an amount equal to the amount required under
subsection (c). The director may prorate the annual application fee for
a license that is modified at least thirty (30) days after the anniversary
date of the licensee's license.
(e) A licensee or an applicant for an initial license must have a
minimum current asset to current liability ratio of one to one (1:1) or
better.
(f) An applicant for an initial license shall submit with the person's
application a review level financial statement or better financial
statement that reflects the applicant's financial situation on a date not
more than fifteen (15) months before the date on which the application
is submitted. A financial statement submitted under this section must:
(1) be prepared by an independent accountant certified under
IC 25-2.1;
(2) comply with generally accepted accounting principles; and
(3) contain:
(A) an income statement;
(B) a balance sheet;
(C) a statement of cash flow;
(D) a statement of retained earnings;
(E) the preparer's notes; and
(F) other information the agency may require.
The director may adopt rules under IC 4-22-2 to allow the agency to
accept other substantial supporting documents instead of those listed
to determine the financial solvency of the applicant if the director
determines that providing the listed documents creates a financial or
other hardship on the applicant or licensee.
(g) An application for a license implies a consent to be inspected.
(h) A person that:
(1) does not operate a facility used to store grain for hire;
(2) purchases:
(A) less than fifty thousand (50,000) bushels of grain per year;
or
(B) only grain used for the production of the person's own
livestock or poultry; and
(3) does not purchase grain by:
(A) offering deferred pricing;
(B) offering delayed payment; or
(C) offering other contracts;
that are linked to the commodity futures or commodity options
market;
is not required to be licensed.
(i) (h) Fees collected under this section shall be deposited in the
grain buyers and warehouse licensing agency license fee fund
established by section 6.3 of this chapter.
(b) If it is determined that a shortage may exist, the director or the director's designated representative shall hold a hearing as soon as possible to confirm the existence of a shortage as indicated by the licensee's books and records and the grain on hand. Only the licensee, the surety company named on the licensee's bond, the issuer of the irrevocable letter of credit, and any grain depositor who has made a claim or complaint to the agency in conjunction with the shortage shall be considered as interested parties for the purposes of that hearing, and each shall be given notice of the hearing. At the hearing, the director or the director's designated representative shall determine whether there appears to be a reasonable probability that a shortage exists. If it is determined that a reasonable probability exists and that the bond or letter of credit proceeds or the cash deposit should be distributed, a preliminary determination shall be entered to the effect that the licensee has failed to meet its obligations under this chapter or the rules adopted under this chapter. At the hearing, the director or the director's designated representative may order that all proceeds from grain sales are to be held in the form in which they are received and to be kept separate from all other funds held by the licensee. The order may also provide for informal conferences between agency representatives and persons who have or who appear to have grain deposited with the licensee. The surety company shall be permitted to participate in those
conferences.
(c) In the event that the director determines that the bond or letter
of credit proceeds or cash deposit is to be distributed, the agency shall
hold a hearing on claims. Notice shall be given to the surety company
named on the licensee's bond, the issuer of the irrevocable letter of
credit, and to all persons shown by the licensee's books and records to
have interests in grain deposited with the licensee. If the agency has
actual knowledge of any other depositor or person claiming rights in
the grain deposited with the licensee, the bond, the irrevocable letter of
credit, or the cash deposit, notice shall also be provided to that person.
In addition, public notice shall be provided in newspapers of general
circulation that serve the counties in which licensed facilities are
located, and notices shall be posted on the licensed premises. At the
hearing on claims, the director may accept as evidence of claims the
report of agency representatives who in informal conferences with
depositors have concluded that a claim is directly and precisely
supported by the licensee's books and records. When there is
disagreement between the claims of a depositor and the licensee's
books and records, the director or the director's designated
representative shall hear oral claims and receive written evidence of
claims in order to determine the validity of the claim.
(d) Any depositor who does not present a claim at the hearing
may bring the claim to the agency within fifteen (15) days after the
conclusion of the hearing.
(d) (e) Following the hearing on claims, the director shall make a
determination as to the total proven storage obligation of the claimants
and the loss sustained by each depositor who has proven a claim.
Depositors found to have proven their claims shall be proven
claimants. In arriving at that loss, in accordance with section 19 of this
chapter, the director shall apply all grain on hand or its identifiable
proceeds to meet the licensee's obligations to grain depositors of grain
of that type. Initial determinations of loss shall be made on the amount
of grain on hand, or identifiable proceeds, and shall reduce the amount
to which a depositor may have a proven claim. With respect to the
remaining unfulfilled obligations, the director shall, for the sole
purpose of establishing each depositor's claim under this chapter,
establish a date upon which the loss is discovered, shall price the grain
as of that date, shall treat all outstanding grain storage obligations not
covered by grain on hand or identifiable proceeds as being sold as of
that date, and shall determine the extent of each depositor's loss as
being the actual loss sustained as of that date. Grain of a specific type
on the premises of a licensee must first be applied to meet the licensee's
storage obligations with respect to that type of grain. If there is
insufficient grain of a specific type on hand to meet all storage
obligations with respect to that type of grain, the grain that is present
shall be prorated in accordance with the procedures described in this
section and section 16.8 of this chapter.
(e) (f) Upon the failure of the agency to begin an audit, which would
serve as the basis for a preliminary administrative determination,
within forty-five (45) days of the agency's receipt of a written claim by
a depositor, a depositor shall have a right of action upon the bond,
letter of credit, or cash deposit. A depositor bringing a civil action need
not join other depositors. If the agency has undertaken an audit within
the forty-five (45) day period, the exclusive remedy for recovery
against the bond, letter of credit, or cash deposit shall be through the
recovery procedure prescribed by this section.
(f) (g) When the proven claims exceed the amount of the bond,
letter of credit, or cash deposit, recoveries of proven claimants shall be
prorated in the same manner as priorities are prorated under section
16.8 of this chapter.
(g) (h) The proceedings and hearings under this section may be
undertaken without regard to, in combination with, or in addition to
those undertaken in accordance with section 17.1 of this chapter.
(h) (i) The findings of the director shall be final, conclusive, and
binding on all parties.
(i) (j) The director may adopt rules under IC 4-22-2 to determine
how the agency may distribute the interest that may accrue from funds
held by the agency for the payment of claims.
(j) (k) A claim of a licensee for stored grain may not be honored
until the proven claims of all other claimants arising from the purchase,
storage, and handling of the grain have been paid in full.
(1) A lender or other claimant that has a receipt for grain owned or stored by the licensee.
(2) A claimant that has a ticket or written evidence, other than a receipt, of a storage obligation of the licensee.
(3) A claimant that surrendered a receipt as part of a grain sales transaction if:
(A) the claimant was not fully paid for the grain sold; and
(B) the licensee failed less than twenty-one (21) days after the surrender of the receipt.
(4) A claimant that has other written evidence of a sale to the licensee of grain for which the claimant has not been fully paid.
(b) A lien under this section attaches and is effective at the earliest of the following:
(1) the delivery of the grain for sale, storage, or under a bailment;
(2) the commencement of the storage obligation; or
(3) the advancement of funds by a lender.
(c) A lien under this section terminates when the licensee discharges the claim.
(d) If a licensee
(e) Except as provided in subsection (g), if a licensee
(f) The priority of a lien that attaches under this section is not determined by the date on which the claim arose. If a licensee
(1) First priority is assigned to the following:
(A) A lender or other claimant that has a receipt for grain owned or stored by the licensee.
(B) A claimant that has a ticket or written evidence, other than a receipt, of a storage obligation of the licensee.
(C) A claimant that surrendered a receipt as part of a grain sales transaction if:
(i) the claimant was not fully paid for the grain sold; and
(ii) the licensee failed less than twenty-one (21) days after the surrender of the receipt.
If there are insufficient grain assets to satisfy all first priority claims, first priority claimants shall share pro rata in the assets.
(2) Second priority is assigned to all claimants who have written evidence of the sale of grain, such as a ticket, a deferred pricing agreement, or similar grain delivery contract, and who completed delivery less than thirty (30) days before the licensee's failure. Claimants under this subdivision share pro rata in the remaining assets if all claimants under subdivision (1) have been paid but
insufficient assets remain to fully satisfy all claimants under this
subdivision.
(3) Third priority is assigned to all other claimants that have
written evidence of the sale of grain to the failed licensee.
Claimants under this subdivision share pro rata in the distribution
of the remaining grain assets.
(g) If a claimant under this section brings an action to recover grain
assets that are subject to a lien under this section and the agency does
not join the action, the director shall, upon request of the claimant,
assign the lien to the claimant in order to allow the claimant to pursue
the claim to the extent that the action does not delay the resolution of
the matter by the agency, the prompt liquidation of the assets, or the
ultimate distribution of assets to all claimants.
(h) If:
(1) a claimant engaged in farming operations granted to one (1)
or more secured parties one (1) or more security interests in the
grain related to the claimant's claim under this section; and
(2) one (1) or more secured parties described in subdivision (1)
have given to:
(A) the licensee prior written notice of the security interest
under IC 26-1-9.1-320(a)(1) or IC 26-1-9-307(1)(a) before its
repeal; and
(B) the director prior written notice of the security interest
with respect to the grain described in subdivision (1) sufficient
to give the director a reasonable opportunity to cause the
issuance of a joint check under this subsection;
the director shall pay the claimant described in subdivision (1) the
portion of the proceeds of grain assets under subsection (e) to which
the claimant is entitled under this section by issuance of a check
payable jointly to the order of the claimant and any secured party
described in subdivision (1) who has given the notices described in
subdivision (2). If only one (1) secured party described in subdivision
(1) is a payee, the rights of the secured party in the check shall be to the
extent of the indebtedness of the claimant to the secured party. If two
(2) or more secured parties described in subdivision (1) are payees, the
nature, extent, and priority of their respective rights in the check are
determined in the same manner as the nature, extent, and priority of
their respective security interest under IC 26-1-9.1.
(1) is a participant in the grain indemnity program;
any of the following conditions:
(1) Possesses written evidence of ownership of grain, including,
but not limited to:
(A) warehouse receipts;
(B) scale tickets;
(C) settlement sheets; and
(D) ledger cards;
that disclose a storage obligation of a licensed warehouseman that
has failed.
(2) Has surrendered warehouse receipts as part of a sale of grain
with a licensed warehouseman who failed not more than
twenty-one (21) days after the surrender of the receipts and the
person surrendering the warehouse receipts was not fully paid for
the grain.
(3) Possesses written evidence of the delivery and sale of grain or
transfer of deferred pricing grain to a failed Indiana grain buyer
or licensed warehouseman, including, but not limited to:
(A) scale tickets;
(B) settlement sheets;
(C) deferred pricing contracts;
(D) basis contracts; or
(E) similar grain delivery contracts;
but did not get fully paid for the sale or transfer.
(2) possesses a claim resulting from a failure of a licensed
grain buyer or warehouse; and
(3) has a claim that has been adjudicated by the agency under
IC 26-3-7-16.5.
(1) An inability
(2) A public declaration of a licensee's insolvency.
(3)
does not exist between a grain buyer and a customer. if there is
not a good faith dispute.
(4) Revocation of suspension of a licensee's license, if the
licensee has outstanding indebtedness owed to claimants.
(5) Voluntary surrender of a licensee's license, if the licensee
has outstanding indebtedness to claimants.
(6) Involuntary or voluntary bankruptcy of a licensee.
(b) The fund shall operate on a fiscal year of July 1 to June 30.
the The agency shall notify each grain buyer registered licensed under
IC 26-4-2 IC 26-3-7 that producer premiums described in section 4 of
this chapter shall be deducted from the purchase price of the grain on
and after the date specified in the notice. The notice must be sent by
first class mail.
(1) is not available for any purpose other than the payment of
(2) may not be transferred to any other fund.
(b) The limiting and nontransferability provision of subsection (a) is declared to be nonseverable from the whole of this article. If subsection (a) is held to be invalid, repealed, or substantially amended, this article shall immediately become invalid and the money remaining in the fund shall be distributed to participants in the fund in a manner that is proportional to the amount of producer premiums each producer paid to the fund.
(b) The time for payment may be extended if the board and claimant mutually agree and put the terms of the payment in writing.
(c) If:
(1) a claimant engaged in farming operations granted to one (1) or more secured parties one (1) or more security interests in the grain related to the claimant's claim under this section; and
(2) one (1) or more secured parties described in subdivision (1) have given to:
(A) the licensee prior written notice of the security interest under IC 26-1-9.1-320(a)(1) or IC 26-1-9-307(1)(a) before its repeal; and
(B) the board prior written notice of the security interest with respect to the grain described in subdivision (1) sufficient to give the board a reasonable opportunity to cause the issuance of a joint check under this subsection;
the board may compensate the claimant described in subdivision (1) in the amount to which the claimant is entitled under section 4 of this chapter by causing the issuance of a check payable jointly to the order of the claimant and any secured party described in subdivision (1) who has given the notices described in subdivision (2). If only one (1) secured party described in subdivision (1) is a payee, the rights of the secured party in the check shall be to the extent of the indebtedness of the claimant to the secured party. If two (2) or more secured parties described in subdivision (1) are payees, the nature, extent, and priority of their respective rights in the check are determined in the same manner as the nature, extent, and priority of their respective security interest under IC 26-1-9.1.
(b) A claimant who has incurred a financial loss due to the failure of a grain buyer is entitled to be compensated by the board from the fund for eighty percent (80%) of the loss incurred less all credits and offsets and any producer premium that should have been due on the sale of the grain. The agency shall determine the loss incurred in the following manner:
(1) For grain that has been priced, the loss shall be the value of the priced grain less any outstanding charges against the grain.
(2) For grain sold to a grain buyer who is also a
(3) For grain sold to a grain buyer who is not a
warehouse.
(1) Determine the valid claims and the amount of such claims to be paid to claimants for financial losses that were incurred due to the failure of a grain buyer or
(2) Authorize payment of money from the fund when necessary for the purpose of compensating claimants in accordance with the provisions of this chapter.
(3) Collect money through subrogated claims against bonds filed under IC 26-3-7 in the place of claimants who collected for a loss incurred due to a warehouse or grain buyer failure.
(4) Borrow money as authorized under IC 26-4-3-9 if the fund has insufficient money to cover
(5) Deposit into the fund any remaining grain assets of a failed grain buyer or
(6) If the amount in the fund is insufficient to pay all
limit the authority of the director of the agency to take disciplinary
action against a grain buyer or warehouseman warehouse operator
licensed under IC 26-3-7 for a violation of IC 26-3-7, this article, or the
rules of the agency.
SECTION 22. THE FOLLOWING ARE REPEALED [EFFECTIVE JULY 1, 2010]: IC 26-4-1-22 ; IC 26-4-2-1; IC 26-4-2-2; IC 26-4-2-3; IC 26-4-2-4; IC 26-4-2-5; IC 26-4-5-3; IC 26-4-6-5.
