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good afternoon everybody this is a third party a gleans you're not as secure as you may think you are welcome to the program I'm Brad Crews and I have with me Emily's daughter Kerr and we're going to be going through a number of things today but we thought this was a excellent opportunity and a good time to review a gleans what they are what their priorities are especially in the current economic client a climate what we have is chapter 12 bankruptcies are up we're seeing more AGG loans that are in distress Morag loans that are under under collateralized and just altogether some general concern about the AG lending environment so we think it's a good time for for people to be aware of the principles and characteristics and some of the ins and outs of AG liens in Iowa's in Iowa so in this backdrop it might be good to understand just as a first principle that a gleans arise by by nature and virtue of statute their statutory lanes that automatically attach and this is in sharp sharp contrast to the way the liens normally arise in the typical lending situation and in the typical lending situation a security agreement of security interest is granted pursuant typically to a security agreement that provides the lender with a lien on various collateral described in the security agreement and at that point if the lien is said to attach to the collateral and so the attachment occurs when when a security agreement provides the secured lender with with a lien and the next step in that situation is is for the blender to perfect the security interest by filing a UCCS statement UCC financing statement agricultural liens are a little bit different the lien attaches automatically upon the occurrence of a certain event for example like in a landlords lien when when when lease is entered into when an agricultural supply dealers lean when agricultural supply supplies are furnished the lien attaches at that point that's not to say though the perfection still isn't important and there are steps to that that still have to be taken in in this situation of an agricultural a Greek isle chiral lien perfection must still occur even though the the lien is created by statute automatically we're going to we're going to talk about landlords liens today that's Iowa Code section 570 we're going to go over agricultural supply dealers liens that's a goose Iowa Code section 570 a we're going to talk about harvesters liens I will Code section 571 custom cattle feedlot liens Iowa code 579 a commodity production contract liens Iowa Code section 579 B lien for services upon animals Iowa code 580 and veterinarians liens Iowa code 581 those are the Iowa agricultural liens that are out there and their corresponding statutory reference so that's what we're going to be going over today and we'll jump into it in a moment the key thing to remember about agriculture all agricultural liens is that they automatically attach to - to farm products farm collateral which include crops and livestock in order to secure the payment for the goods and services furnished to a farm op operator and the reason and the policy behind the agricultural liens are to encourage providers vendors of farm supplies and armed farm services to provide those supplies and services to farmers and encourage them to do so even if there isn't a formal security agreement or lender relationship so let's jump right into let's jump right into landlords liens that's Iowa Code section 570 that that provision provides that a landlord shall have a lien for the rent upon all crops grown upon the leased premises and upon any other personal property of the tenant which has been used or kept therefore they're on during the term which is not exempt from execution so a land landlord's lien is a lien for rent on all crops grown on the leased premises and on other personal property that that's kept there on it automatically attaches to any farm products that are grown on the land and it has a special priority ahead of previously perfected security interests in statutory lanes and that's because this priority comes ahead of that of banks and it also comes ahead of egg supply dealers may also have liens as well we'll get into priorities a little bit but I'm going to I'm going to touch on them briefly as we go now the key to perfecting again we talked about the attachment so and the difference between attachment and perfection so it automatically attaches as soon as the you know the lease on the farm ground begins so there's the attachment component but in order to be to perfect the security and security interest the the the landlord has to file a UCC one either at the time of taking possession or within 20 days of taking possession - to be able to have that perfection and be able to maintain that lien ahead of any any bank or financial institution that has has a lien on a similar product farm products the landlord's lien continues for one year after the rent is due or for six months after the end of the lease whichever comes first it's so one way to look at it is is that it's only it's only available at the time the tenth tenant takes possession of the property and and and within 20 days thereafter if if the if the UCC is not is not filed in that time frame than the the priority as to other other lien holders such as banks financial institutions it is lost a couple of things I would point out I will try not to get down too much into the weeds here on this but a couple of things that I would note Iowa farm lease law indicates that determine date termination date for farm tenancies is March 1st March 1st of the year that the lease terminates and that's under Iowa Code section five sixty two point five and because most farm leases begin on March 1st and a tenant takes possession on that date a financing statement to perfect the landlord's lien in farm products which would typically have to be filed on by March twentieth of that year in which the lease begins in order to protect in order to perfect the security interest another point to make is that under feiiow wa farm lease lot that day if a farm lease continues past a one-year you know it could be a multiple year lease or if it even if even if the lease is only a year long and attendant continues in possession of the property on a holdover basis after that the Iowa farm lease law indicates that that situation in that situation the the lease would can continue from year to year on a year-to-year basis so it's a little unclear under under those provisions as to whether or not an additional perfection of a security interest would need to be a a filed or an additional UCC would need to be filed in that situation for those would be landlords or those landlords out there that are trying to obtain a security interest the advice would be to prompt to to file a UCC each year even even if the lease is a multi-year lease either because the term of the lease just you know there's a five-year lease say or even if it even if it goes up into a holdover status and it's going year to year the recommendation would be to file a new UCC each time so each year in order to preserve it and likewise if if a bank is in a situation where that hasn't been a yearly of UCC one hasn't been filed by the landlord that's potentially an area to to challenged as the law is a little bit unsettled there there is some new law well not new law but there is some law out there that indicates that that the landlords lien attaches to proceeds there was some confusion on that back in the in the 80s and I'll try to point out as we go through some areas that maybe have changed there's been a fair number of developments since about 2011 so if if the last time you had an issue was you know in the economic downturn of 2007 2008 2009 kind of that period it would be good to double check the status of some things because some things have changed significantly and I'll try to point those out as we go through one of them is is that the lien created the landlord's lien created under five 70.1 extends the proceeds of crops grown on leased premises and that that holding that was from the Iowa Supreme Court back in the late 80s was also extended to to the proceeds of the sale of hogs as as well so a little bit of a kind of an update to that situation I'm going to jump next go to the next slide I'm going to jump forward from landlords liens we're going to go over and talk about agricultural supply dealers liens and that those liens arise under Iowa Code Section five seventy eight point three the agricultural supply dealers lien is a lien for the retail cost of the agricultural supply which does include labor provided it applies to all crops and all livestock although there is a little bit of a differentiation between crops and livestock when we get to the certification requirements and when we get to the priorities and I'll get to those in a minute but as with the other agricultural liens in order to the lien that again attaches at the time the agricultural supply is provided the supplier must file a UCC one financing statement within 31 days after the initial purchase and I've added the language and after any subsequent delivery now there again is another change in the law that's fairly recent that is from a 2016 Iowa Supreme Court case so again if your your pure a lender or a party that has not really dealt with any issues with respect to AG liens in the last several years there have been some changes there was a split of authority in the courts as to whether a agricultural supply dealer was required to file a new UCC each time goods were delivered or as to whether they could simply rely on the UCC that was filed at the time of initial delivery and that and that they didn't maybe have to file separate UCC ones each each time goods were delivered well it may not you don't probably have to file each time the goods are delivered but certainly if if 31 days goes by and and new goods are delivered outside that initial 31-day period the Supreme Court has clarified that in order to Maine to the lien and maintain the priority that you get with the agricultural supply dealers lien the supplier has to file a UCC one financing statement you know within 31 days after the initial purchase and that would cover any subsequent deliveries so there's a new development from 2016 that clarified an area that was somewhat unsettled before the agricultural supply dealers lien has equal priority with prior perfected bank liens and it also will cover the priorities with with other but it is it is it is less lesser in priority to to a landlord's lien and to a harvesters lien now I got to qualify that equal priority because there's a certification requirement that must be complied with for agricultural supply dealers liens and and that certification requirement basically requires that in order to enforce a lien the supplier must provide a certified request to two lenders who are on record of having having a pre-existing security interests in in the in the crops and or livestock at issue and that certified request has to indicate the amount of the purchase the terms of the sale and and and and a waiver of confidentiality signed by the farmer and after receiving the certified request the lender is required within four days to issue to the supply dealer a memo a memo indicating whether or not that the farmer or purchaser of the supply has sufficient network in order to ensure payment if the if the lender states that the farmer has sufficient worth in the line of credit the the memo memo essentially operates as a letter of credit for a period of 30 days when the final payment is due on the other hand if the if the memo issued by the lender states that the farmer doesn't have sufficient worth or la or line of credit then the the lender maintains its priority with respect to to that particular lien and and that really makes sense so essentially what's what's happening is just simply that the you know the policy the policy goal is that to try to discourage an agricultural supply dealer from just haphazardly without doing much due diligence just issuing you know abusing it's priority status by by lending providing credit to a farmer who is maybe maybe not in a good position to receive that and so the policy is that in that situation if the if the egg supply dealer doesn't at least make inquire and make inquiry then they shouldn't be able to hop over the position of the bank with respect to the egg supply dealers lien now if that wasn't hopefully that wasn't confusing but another nuance to that is that now that certification only applies to agricultural supply dealers liens on crops and as you might remember moments ago I mentioned that the the lien applies to crops and to livestock but the certification requirement has been held by the Iowa Supreme Court to only apply to crops not to livestock livestock producers have a special position these of the agricultural supply dealers lien they are they are able to maintain their a priority position and maintain their agricultural supply dealers lien as to supplies rendered to livestock even if they do not comply with the certification requirements and that was a Iowa Supreme Court case the case of Owens feed and supply the prime bank there's a series of those Owens cases and that was a case from back in 2011 so again if you haven't been involved in one of these four in the last few years that's a new big change that was was clarified by the Iowa Supreme Court so in that situation a in the in the sitch I'm sorry where where livestock is involved noted that the certification requirement does not have to be complied with by the agricultural supply dealer in order for that that supply dealer to maintain its its lien and its lien priority so and that all that language comes out a lot of that language comes out of five the certification language comes out of Iowa Code Section five seventy eight point two we were happy to help you with you there's any confusion in that regard you can certainly you know if you dare endeavor to read the statute it's all in five seventy eight point two but we're happy to provide any any clarification on on those requirements if necessary I mentioned the boyens case and uh that it was quite an important case by the Iowa Supreme Court again we can that I'll give you the case site that's 808 Northwest 2d 186 for any lawyers out there or any other parties that follow that kind of thing I would like to read and that's that's Iowa Supreme Court case in 2011 and that's that's the case that holds that the the the lien is on on does not the certification requirements do not apply to livestock feed so let me here here's me one other case I wanted to point out it's kind of an important case another one is the case of in racially and that was a court from the Bankruptcy Court for the Northern District of Iowa in 2014 and and the court ruled there that the that the that agricultural supply dealers lien created pursuant to Iowa Code section 570 a that if it was held that it if the lien only applied to hogs themselves and not the proceeds the court held that would not make much sense and that would provide a little protection to the feed supplier and would discourage feed feed suppliers from working with troubled farmers so the in in the the import of that case was was to clarify that in an agricultural supply dealer lien not only does the lien attached to the the hogs themselves or the cattle themselves but it would also apply to the proceeds of the sale of such hogs or cattle if they were essentially sold and the court reasoned and I think quite correctly that if if the lien didn't actually attack to the proceeds there wouldn't be much it would be pretty hollow comfort not much protection to an agricultural supply dealer if you know to have a lien but only to see that lien you know washed away if the farmer you know sold the hogs sold the cattle what-have-you so there was a clarification of that that was a 2014 case again slightly new development so if you were had an issue come up in the past and there was some maybe some confusion or question of whether to lean the agricultural supply dealers lien attached to the proceeds of livestock that was that was clarified in that case then I'm going to flip over to harvesters lien which will b
the last of the liens that I cover before Emily takes you through the remaining liens the harvesters lien that arises and that big next on the next slide harvesters lien Iowa Code section 570 1.1 harvesters lien is a lien for the value of harvesting services that applies to crops harvested by the harvester it becomes effective and attaches at the time that the services are are rendered once again as with the other liens even though it attaches in order to to perfect the lien and preserve the priority the harvester must file a UCC one financing statement within 10 days after the last date that services were rendered now I can tell you is a little aside sometimes that can be quite a sticky factual situation if it if it if there's a lien dispute or a priority dispute and and a dispute under whether the underlying lien was perfected because it sometimes is not clear exactly when the last date that that services were rendered courts have generally been fairly liberal that but it's often very difficult to prove either by one side or the other in the situate the services were rendered is that the last day that the equipment was taken off did the the harvesters mere presence on the site even though no work was done did that constitute services being rendered those are some issues that can kind of arise in that it can get very sticky as to when when the last ten days were and again it's just very difficult to prove when when the harvester was was last there but that's just something to be aware of the harvesters lean does have priority over over a conflicting security interest in the harvested harvested crops regardless of when that security interest was perfected and also it's as I as I briefly touched on before and a harvesters lean has priority over a conflicting landlords lien as well so which is probably a a pretty good probably a pretty good segue segue into the next slide which is lean priorities which can be a little bit murky and and somewhat intricate the AG supply dealers lien has equal priority to a lien or security interest created prior to the time of perfection for example it's equal to a bank security interest in collateral for an operating loan now landlords lien has priority as I mentioned before over a conflicting egg supply dealers lien and a harvesters lien also has priority over a conflicting egg supply dealers lien now you see that I've noted the super priority down there and that basically I think we've probably covered that but that simply refers to the super priority that's that's given an agricultural feed dealer in in livestock that's that's a separate animal they have a almost a better priority than a similar agricultural supply dealer lean in on crops and that one it has the egg supply dealer lean in in livestock has priority over an earlier perfected lien or security interest to the extent of the difference between the act acquisition price of the life's livestock and the fair market value price of the livestock at the time that the lien attaches or the sale price of the livestock whichever is greater and once again a new development by the Supreme Court again was in one of the audience cases the Iowa Supreme Court fairly recently indicated that in a Farrow to finish operation the acquisition price of the odds would be would would essentially be zero that's any Farrow to finish operation so and then last bullet point at the agricultural feed dealer lien and livestock as I've said is special over the earlier lien or security interest to the extent of the difference between the acquisition price of the livestock and the fair market price of livestock at the time the lien attaches to the sale price of the livestock whichever is greater I know I said that twice but you almost have to read it twice you look at that twice and think about it a couple of times because it's it's drafted sort of oddly in the in the statute but that's it it's worth noting that and that that can be again that's one of those situations that can be very factual somewhat factual intensive in terms of the calculation as to the amount of the lien think we've next slide I've got agricultural supply dealers clean the certified request process I think we've covered that pretty well but just to reinforce egg supply dealers must provide a certified request to other lenders who have provided operating liens the farmer in order to enforce their egg supply dealers liens again after receiving a certified request a lender within four business days must issue a memo to the dealer stating whether or not the farmer has sufficient net worth or line of credit to make the payment if the lender says yes the memo memo operates as a letter of credit let's just real briefly look at it in the opposite way if the lender does not respond within four business days at all then the egg supply dealers lien is going to be given priority over over the lenders lien on the other hand if the lenders responds within the four days and issues you know a memo to the supply dealer indicating that the farmer does not have sufficient credit then the lender will be able to maintain its lien position visa be the egg supply dealers lien and with that I'm going to turn it over to Emily who's going to do a great job of talking about the rest of the Iowa AG leans and give some very very good real-world examples of things thanks Brad first I'm going to start with the custom cattle feedlot lean a custom cattle feedlot operator has a non-possessory lean on cattle and identifiable cash proceeds for the amount of the cost for the care and feeding of cattle um this lean becomes effective when the cattle arrive at the feedlot and it continues for one year after the cattle leave the feedlot um just as most of the AG AG liens are it is perfected by filing a financing statement with the Secretary of State's office within 20 days of the arrival of the cattle at the feedlot and it is a priority lien with the exception of a perfected veterinarians lien a perfected custom cattle feedlot lien has priority over all the other statutory liens and article nine security interests um and this is regardless of when they are perfected unlike the landlord's lien you do not need to provide a statement on the financing statement indicating that it is a custom cattle feedlot lien as I will discuss in a little bit more detail this is beneficial because if you're a custom cab cattle feedlot operator you could potentially use this lien or the next one I'm going to talk about which is the commodity production contract lien in order to enforce a custom cattle feedlot lien there are two separate scenarios one is that in which the cattle are located at the feedlot still and this is the same as other agricultural liens following that that statutory process if however the cattle have already left the feedlot the operator may enforce the lien by commencing an action at law for the amount of the lien by doing either one of two things um the holder of the ID it can go against the holder of the identifiable cash proceeds from the sale of the cattle or the cattle went to a processing plant the processor who has purchased the cattle within three days after after the cattle have left the custom cattle feedlots so if a feedlot operator is looking to enforce a lien they must be diligent in monitoring their collateral because if it goes to the processor they only have three days to commence that actions um as I briefly touched on a custom cad law cattle feedlot operator may file and enforce a lien under either this section or the commodity production contract lien one thing that cattle feedlot operator should be aware of however is that if they were to loan money to a producer to purchase the cattle that are going to be fed in the lot that is not an automatic lien like the feedlot lien the feedlot lien only applies to the feed and services that were rendered in that feedlot not the purchase price of the cattle so if this is a scenario that occurs a feedlot operator would need to get standard security agreement put into place and file a financing statement under article 9 of as a typical lender would in that situation the commodity production contracts lien is when a producer is feeding another person's livestock not including poultry or raising another person's crop on the producers farm then the purpose must be for food animal feed fiber or oil if the livestock or crop is sold by the contractor the lien can be on the cash proceeds from that sale and the cash held by the contractor shall be deemed to be cash proceeds from the sale regardless of whether it is identifiable or not if the livestock is slaughtered or the crop is processed by the contractor the lien shall be on the property of the contractor that may be subject to a security interest as provided in article 9 of which is the standard security interest code chapter the lien is effective when the livestock arrived at the farm or when the crop is planted and it continues for one year after that time in again it's perfected by filing a financing statement within 45 days so one thing to point out here is if you are a cattle feedlot operator and you missed your 20-day deadline with that under that code section you can still file a financing statement and keep your super priority as long as it's within that 45 days or as an excellent point says the 180 days if the livestock continuously arrived meaning more than a a period of 30 days there multiple arrivals with the exception of perfected veterinarians lien a perfected commodity production contract lien has priority over other statutory liens and article nine security interest regardless of when they are perfected and again this this boot bag lien does not require a an express statement on the financing statement so going back to the the cattle feedlot operator if that's if that's your business then realistically when you file the financing statement it could be either of a chapter 579 a or 579 be a glean when enforcing in order to enforce a commodity production contract lien if it is before the commodity leaves the authority of the contract producer the contract producer may enforce a lien created in that sector in that section just as they would any other agricultural lien as provided up in the article nine which is the security interest part of the Iowa Code after the commodity is no longer under the authority of the contract producer the producer may enforce Aleem provided in article nine up part six um waivers of right provided by the chapter aboard so you can't waive your your right to this lien it with with a bank and as I'd already mentioned a custom cattle and feedlot operator might file and in for saline under five seventy nine a or be but not both so when when you really only need to file one financing statement if you're a cattle feedlot operator but you can only enforce under either a chapter um I already kind of mentioned about you miss if a cattle feedlot operator misses the 20-day perfection period they thank you the second shot at the Apple so to speak by perfecting under this chapter the veterinarian's lien is poured the the services provided by a veterinarian and treating a livestock and it's only for the cost the actual cost of any product used or services rendered um so in series the amount of this lien would be relatively small it becomes effective when the treatment occurs and it is perfected by filing a financing statement within 60 days after the treatment and it has priority over conflicting security interests or liens regardless of when they're perfected enforced up by the same code chapter as the other AG liens and uh there is no Express statement on the financing statement required um I don't have a slide for it but there is one other statutory lien to be aware of and that is for the services of animals and that would constitute services for stud fees or things of that nature and those become automatically perfected as well just something to be aware of probably doesn't occur too often but just something to be aware of that that is out there as well okay the next thing I want to discuss a little bit is the purchase money priority rules in agriculture and these are not to be confused with the agricultural liens that we have been discussing up for the presentation in the presentation up until this point these are what are referred to as security interests in article 9 and they are the the typical type of thing that a bank would see it as far as their liens go so these require a consensual agreement from the debtor to sign a security agreement whereas everything up until this point was a unilateral non-consensual liens this is a consensual lien however it also has super priority implications so I wanted to discuss it in this presentation today to obtain a purchase money super priority in equipment collateral the creditor must satisfy two requirements one that the credit extended by the creditor must actually be used by the debtor to purchase the collateral and to the creditor must properly file a financing statement covering the collateral within 20 days of the date the debtor takes possession of the collateral um another thing worth noting that in a priority dispute between two perfected purchase money creditors a security interest in favor of a seller will take already over a security interest in favor of a creditor who merely extended an enabling loan meaning the loan which enabled the borrower to acquire the collateral I bring this up because of many bank loans or operating loans would be those enabling loans so it's worth noting that a purchase money lien up from directly from a financing company for the purchase of equipment would take priority over those operating loans um and I have a couple of examples here just to further illustrate how how that would work so our first example is that on March 1st Bank extends a line of credit to farmer farmer grants Bank a security interest in all equipment and farm products now owned are here and after acquired bank properly files a financing statement on March 10th with the financing statement containing blanket language on October 1st farmer approaches finance company to request a loan for the purchase of a combine finance co agrees to make the loan and once the specific combine is identified for purchase finance Code disperses the funds for the purchase directly to the equipment dealer farmer signs a security agreement granting finance Co a security interest in the combine farmer takes delivery of the combine on November 1st on November 16th finance company properly files a financing statement describing the combine by brand model and serial number farmer subsequently defaults on his obligations to bank and finance Co who have in the question is who has priority in the combine the answer is Finance Co because it extended the purchase money used to acquire the combine and properly filed a financing statement covering the combine within the 20 days after farmer receive possession a second example to be aware of is is the one I have here uh it's one in which a Glenda extends a line of credits a farmer and a farmer grants AG lender security interest in all inventory equipment and farm products now owned are here and after acquired AG lender properly files a financing statement on March second with the financing statement containing blanket language on July 1st farmers then requests a new loan for a combine from the equipment dealer after meeting with farmer and reviewing the documents of banker bank agrees to make the loan on that equipment the bank just vs. 180,000 directly to farmer which is equal to 80 percent of the retail price of the combine on that same date farmer signs a security agreement granting bank a security interest in the combine then on July 20th farmer acquires the combine from the dealer instead of using all the funds provided by bank farmer transfers several items of equipment to the dealer as trade in for the combine after considering the traded equipment then only $70,000 remained as the price for the combine so then the farmer pays this amount to the dealer using the money loaned by the bank that $180,000 and uses the rest of the loan to buy a bass boat two jet skis and an aboveground swimming pool all this time bank is unaware that much of the loan funds
were used for purposes other than buying the combine and files its financing statement on July 30th then farmer defaults the question then being who has priority um well Bank filed its financing statement within the window as it should have a but only $70,000 of the money loaned gets that purchase money security interest priority thus banks has priority only on the 70,000 not the remaining 110,000 up uh that they loaned out so I think this example is a good demonstration of why if you as a lender are in the markets of these purchase money loans um it's a good idea to make the check directly payable to the equipment dealer or other entity that is is selling the product um then I just wanted to discuss it you know a couple of ways to protect yourself as a lien holder um when it comes to the AG supply dealers lien um there's a few provisions that could be included that at least would helps uh and that would be you could require that a producer list all their feed suppliers um require notice subordination or waiver of feed lien by producers feed suppliers require producer to provide monthly feed bills to the lender or provide for the lenders ability to adjust the borrowing base if there are any unpaid feed bills that comes up as a as a result of that Owens case that Brad discussed earlier in addition it's essential that the perfection of an Ag lien is maintained normally for a security interest it is governed by law where the debtor is located but for Ag liens C it is governed by the law where the collateral is located so if a glean collateral leads to stay you should assure that you perfect in that new state otherwise the priority is lost during that time period additionally and Brad touched on this but if the collateral is sold and a gleam continues on that collateral if it is sold leased license exchanged or disposed of in another way um unless the secured party authorized the disposition free of saline and but as Brad mentioned it is disputed as to whether an Ag lien attaches to the proceeds of collateral so it is wise to get a consensual security agreement just to ensure that that doesn't become an issue okay this is simply just a handy chart that I wanted to include it is from the Iowa State University Center for agricultural law and taxation they have a lot of really great resources as well relating to other topics so this is mostly just for your reference but it is a very good summary of what we have discussed today so I think in wrapping up my portion in this webinar today I think that the examples that we've provided and the the priorities created by these AG liens and purchase money security interest show that it is essential to evaluate your collateral position on a periodic basis um units I would say obviously it depends how often you evaluate that depends on the creditors position at the time um but it's worth noting that the best time to correct technical errors or deficiencies and loan files is at the first sign of distress this is the point at which the lender has leveraged and the debtor is often still willing to cooperate at this time as well so you know as we feel the walls kind of closing in on the AG industry at least that seems to be the feeling right now it's important to to think about these things that evaluate your collateral position and take a look at your loan files a part firm would certainly be able to loan files and help you to identify any possible issues each loan file is completely different and it's it's to say exactly what to look for um without knowing the contents of each loan file but I think these should give you some things to look out for anyway sure it looks like we had hmm a question pop up and the question says uh what is the status on Bank blanket UCC filing in regards to federal crop insurance proceeds there was a district court case that concluded an entity with specific lien with the carrier took priority over the bank it blanket lien position um I am unaware of this district court case but now I'm very interested in and we'll we'll take a look at it and get a more specific answer to your question however I think it's worth noting that farmers may assign cash payments to the bank with an assignment of payment and the payments are considered general and tangibles and the crops are considered farm products the there is a specific form for the assignment of pay and it is from the the USDA um I believe it is form number CCC - 36 and that's that's the assignment of payment a the bank must also have a security agreement covering the collateral and perfect by filing a UCC one so that that financing statement must excuse me the security agreement must cover those general intangibles for for those cash payments um yeah and just just to add to that to the extent maybe that the question is seeking like in the guidance in in the priority context of an egg of an Ag lien as as Emily noted the the the secure the security interest of which a gleans attached to is a pretty narrow universe of items and they're just limited to two farm products in fact they're just limited to the farm products which which were supplied by the by the agricultural supply dealer or the the services from a harvester and so forth so it just related to those those specific farm products related to that land now with the landlord's Lena does that does encompass a little bit of an expanded world there which would include property or personal property that the farmer brings on on the land as well and that's that's in the situation of landlords lien but um it's it's not to say that the it the egg supply dealer or that an AG lien holder has like a blanket lien on on all of the assets you know farm assets that the farmer might have such as equipment and you know right to receive payments general intangibles and all of that so again probably shouldn't say too much because I haven't read the case either and we can take a look and respond and give our our take on on the impact of the case all right with that I think that concludes our webinar for the day thank you for attending and please let us know if you have any additional questions or if we can help you out with anything in the future you you
