Pennsylvania Act 1986-74 — POULTRY CONTRACTS - PAYMENTS AND SECURITY INTERESTS

Act text

POULTRY CONTRACTS - PAYMENTS AND SECURITY INTERESTS
                  Act of Jul. 2, 1986, P.L. 301, No. 74               Cl. 03
                                  AN ACT

     Providing for the provisions of poultry and egg contracts; and
        imposing civil penalties.

        The General Assembly of the Commonwealth of Pennsylvania
     hereby enacts as follows:

     Section 1.  Findings and purpose.
        The General Assembly hereby finds:
            (1)  That the poultry and egg industries in Pennsylvania
        are vital to the health and welfare of all Pennsylvanians.
            (2)  That all segments of these industries, including
        farmers, brokers, processors and retailers, need to be
        financially secure in order for the industry to benefit the
        citizens of this Commonwealth.
            (3)  That there are insufficient guarantees of payment to
        poultry and egg farmers.
            (4)  That, if poultry and egg farmers are not financially
        secure, these industries would collapse, thereby threatening
        the jobs, health and welfare of thousands of Pennsylvanians.
     Section 2.  Definitions.
        The following words and phrases when used in this act shall
     have the meanings given to them in this section unless the
     context clearly indicates otherwise:
        "Grower."  A person who provides physical facilities for
     housing and labor for raising poultry, whether or not he
     provides additional services incidental to the raising of
     poultry.
        "Merchant."  A person who buys poultry directly from the farm
     in wholesale quantities within this Commonwealth, including, but
     not limited to, purchases on commission and purchases by a
     dealer, owner or broker.
        "Notice."  Notice in writing by certified mail at the last
     known address or by personal service.
        "Person."  Any individual, partnership, sole proprietorship,
     corporation or entity.
        "Personal service."  Actual delivery of written notice to the
     person to whom it is directed or to an adult individual at the
     residence or place of business of the person.
        "Poultry."  All types of chickens (whether raised to be sold
     as layers or for processing), chicken eggs, ducks, geese,
     turkeys and all game birds raised for processing.
        "Poultry contract."  Any agreement, either oral or written,
     between a grower and a merchant relating to the raising of
     poultry by the grower.
     Section 3.  Time for payment.
        Unless otherwise agreed to in writing by the parties
     involved, all sums due to a grower by a merchant under a poultry
     contract shall be paid to the grower within 21 days of the date
     on which the grower delivers the poultry to the merchant.
     Section 4.  Interest on late payments.
        Beginning on the 22nd day after the date of delivery, the
     merchant, unless otherwise agreed to in writing by the parties
     involved, shall be liable to the grower for interest on the
     unpaid balance of sums due. Unless otherwise agreed to by the
     parties involved, the interest is to be simple interest at the
     rate published by the Secretary of Revenue pursuant to section
     806 of the act of April 9, 1929 (P.L.343, No.176), known as The
     Fiscal Code.
     Section 5.  Mortgages or other security given by growers to
                    merchants.
        Unless otherwise agreed to by the parties involved, a
     recorded mortgage or other security given by a grower, as
     mortgagor or obligor, to a merchant or his assignee or designee,
     as mortgagee or obligee, shall be satisfied promptly by the
     merchant upon the delivery of the poultry to the merchant by the
     grower or the making of a declaration of default by a grower
     under section 6. In the event of default, a continuing security
     interest agreed to by both parties shall be satisfied by the
     party who owes the debt.
     Section 6.  Rights of unpaid grower.
        (a)  Civil action authorized.--A grower who is not paid
     within 21 days or who is not paid interest on a late payment, as
     provided in sections 3 and 4, may bring a civil action against
     the merchant in a county where the grower resides or does
     business or in any other county provided by law or rule of
     court.
        (b)  Court may award costs.--In an action instituted under
     this section, the court, in issuing a final order, may award
     costs of litigation, including reasonable attorney and expert
     witness fees, to the grower whenever the court determines that
     such an award is appropriate.
     Section 7.  Civil penalties.
        In an action filed pursuant to section 6, or in a separate
     action, a person who is found in default and liable more than
     twice within a 12-month period shall be subject to a civil
     penalty equal to twice the amount of each late payment. The
     Secretary of Agriculture shall have the authority to bring a
     civil action to impose this penalty and to revoke any related
     licenses of the defaulting merchants within the jurisdiction of
     the Department of Agriculture.
     Section 8.  Applicability.
        This act shall not apply to poultry contracts which are in
     effect prior to the effective date of this act.
     Section 9.  Effective date.
        This act shall take effect in 90 days.