Securing All Livestock Equitably Act of 2020 or the SALE Act of 2020
This bill requires all livestock purchased by a dealer in cash sales and all inventories of, or receivables or proceeds from, such livestock to be held by the dealer in a trust until all unpaid cash sellers of the livestock have been paid.
The bill exempts from the requirement any dealer whose average annual purchases of livestock do not exceed $100,000.
The bill also specifies requirements regarding enforcement, preserving a trust, notifying lien holders, and purchasing or transferring livestock that is subject to a trust.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 3419 Introduced in Senate (IS)]
<DOC>
116th CONGRESS
2d Session
S. 3419
To amend the Packers and Stockyards Act, 1921, to provide for the
establishment of a trust for the benefit of all unpaid cash sellers of
livestock, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 9, 2020
Mr. Inhofe (for himself, Ms. Smith, Mr. Cramer, Mr. Hoeven, Ms. Ernst,
Mr. Daines, Mr. Tester, Mrs. Hyde-Smith, and Mr. Grassley) introduced
the following bill; which was read twice and referred to the Committee
on Agriculture, Nutrition, and Forestry
_______________________________________________________________________
A BILL
To amend the Packers and Stockyards Act, 1921, to provide for the
establishment of a trust for the benefit of all unpaid cash sellers of
livestock, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Securing All Livestock Equitably Act
of 2020'' or the ``SALE Act of 2020''.
SEC. 2. ESTABLISHMENT OF TRUST FOR BENEFIT OF UNPAID CASH SELLERS OF
LIVESTOCK.
Title III of the Packers and Stockyards Act, 1921 (7 U.S.C. 201 et
seq.), is amended by adding at the end the following:
``SEC. 318. STATUTORY TRUST ESTABLISHED; DEALER.
``(a) Definition of Cash Sale.--In this section, the term `cash
sale' means a sale in which the seller does not expressly extend credit
to the buyer.
``(b) Establishment.--
``(1) In general.--Except as provided in paragraph (2), all
livestock purchased by a dealer in cash sales and all
inventories of, or receivables or proceeds from, that livestock
shall be held by the dealer in trust for the benefit of all
unpaid cash sellers of that livestock until full payment has
been received by those unpaid cash sellers.
``(2) Exemption.--This section shall not apply to a dealer
the amount of average annual purchases of livestock of which
does not exceed $100,000.
``(3) Effect of dishonored instruments.--For purposes of
determining full payment under paragraph (1), a payment to an
unpaid cash seller shall not be considered to have been made if
the unpaid cash seller receives a payment instrument that is
dishonored.
``(c) Preservation of Trust.--An unpaid cash seller shall lose the
benefit of a trust under subsection (b) if the unpaid cash seller has
not preserved the trust by--
``(1) providing a written notice to the applicable dealer
of the intent of the unpaid cash seller to preserve the
benefits of the trust; and
``(2) filing that notice with the Secretary--
``(A) not later than 30 days after the final date
for making a payment under section 409 in the event
that a payment instrument has not been received; or
``(B) not later than 15 business days after the
date on which the seller receives notice that the
payment instrument promptly presented for payment has
been dishonored.
``(d) Notice to Lien Holders.--Not later than 15 business days
after the date on which a dealer receives notice under subsection
(c)(1) with respect to a trust, the dealer shall give notice of the
intent of the unpaid cash seller to preserve the benefits of the trust
to all persons who have recorded a security interest in, or lien on,
the livestock held in that trust.
``(e) Purchase of Livestock Subject to Trust.--
``(1) In general.--A buyer in the ordinary course that
purchases livestock that is held in trust by a dealer under
subsection (b) shall receive good title to the livestock free
of the dealer trust if the buyer receives the livestock--
``(A) in exchange for payment of new value; and
``(B) in good faith and without notice that the
transfer is a breach of trust.
``(2) Payment.--Payment shall not be considered to have
been made under paragraph (1)(A) if a payment instrument given
in exchange for the livestock is dishonored.
``(f) Transfer of Livestock Subject to Trust.--A transfer of
livestock that is held in trust by a dealer under subsection (b) shall
not be considered to be for new value under subsection (e)(1)(A) if the
transfer is--
``(1) in satisfaction of an antecedent debt; or
``(2) to a secured party pursuant to a security agreement.
``(g) Enforcement.--
``(1) In general.--The Secretary shall carry out at least
one of the enforcement activities described in paragraph (2) if
the Secretary has reason to believe that--
``(A) a dealer has failed to perform the duties
required by subsection (b) with respect to a trust
under that subsection; or
``(B) carrying out an enforcement activity is in
the best interest of an unpaid cash seller.
``(2) Enforcement activities.--The enforcement activities
referred to in paragraph (1) are the following:
``(A) Appointing an independent trustee to carry
out the duties of the trustee in accordance with this
section, preserve trust assets, and enforce a trust.
``(B) Serving as an independent trustee, preserving
trust assets, and enforcing a trust.
``(C) Bringing a civil action in the district court
of the United States for the judicial district in which
the dealer resides--
``(i) to enjoin a dealer from performing
the duties required by subsection (b); and
``(ii) to preserve trust assets and enforce
a trust.
``(3) Effect on unpaid sellers.--Nothing in this subsection
precludes an unpaid cash seller from bringing a civil action in
a court of competent jurisdiction to preserve or enforce a
trust under subsection (b).''.
<all>
Introduced in Senate
Read twice and referred to the Committee on Agriculture, Nutrition, and Forestry.
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