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Ag Supply Liens Mike Irvin
July 2010
This time of
year many have or are attempting to purchase
supplies such as seed, fertilizer, pesticides and
petroleum products. Many times these purchases are
on credit or on open account. However, suppliers may
try to protect themselves by obtaining a lien on the
crops and/or livestock produced with such inputs.
The supplier must discover
what other parties, if any, have a security interest
in your crops or livestock. The supplier is required
to contact these creditors and inquire about your
financial abilities. This puts the creditors on
notice that the supplier may be attempting to create
a lien.
Kansas law requires the
agricultural supplier take the following action to
perfect a lien on inputs:
Complete an Ag Production
Input Lien form (provided by Kansas Secretary of
State)
Mail copy of notice by
certified mail to the lender in an envelope marked
"IMPORTANT LEGAL NOTICE"
The lender has 5 days after
receipt to respond with a letter of commitment to
advance the retail cost stated in the notification
or issue a written refusal
If lender refuses to respond,
the supplier must file the original form with the
Secretary of State within 60 days after the product
was furnished to perfect the lien.
A UCC-1 must accompany the
lien form
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