SENATE BILL REPORT

SHB 60

BYHouse Committee on Natural Resources (originally sponsored by Representatives Haugen, Basich, S. Wilson and P. King) 

Establishing processor liens for commercial fishermen.

House Committe on Natural Resources

Senate Committee on Natural Resources

Senate Hearing Date(s):March 23, 1987; March 24, 1987

Majority Report:  Do Pass.

      Signed by Senators Owen, Chairman; DeJarnatt, Vice Chairman; Barr, Conner, Craswell, McDonald, Metcalf, Patterson, Peterson, Rasmussen, Stratton.

Senate Staff:Kaleen Cottingham (786-7415)

                  March 24, 1987

AS REPORTED BY COMMITTEE ON NATURAL RESOURCES, MARCH 24, 1987

BACKGROUND:

Farmers frequently sell their crops to a processor who pays the farmer at a later date.  These farmers (also known as producers) have statutory protection ensuring they will receive payment through their use of a "processor's lien."  The processor's lien consists of a first priority lien against the processor for the price or value of the product delivered.  The lien attaches on the date the product is delivered and continues without filing until 20 days after payment is due.

If payment for the product is not made by the date it is due, a producer may file a lien statement with the Department of Licensing. If a lien statement is filed within the 20 day period after the payment was originally due, the lien continues its priority over all other liens except those for taxes or labor performed before the filing of the lien.  If it is not filed within 20 days, the lien is subordinate to certain security interests and liens.

A processor's lien terminates 6 months after the date of attachment or filing, unless a suit to foreclose it is initiated before that date.

If an agricultural producer files a lien statement and subsequently receives full payment, the producer shall file a statement with the Department of Licensing stating that the lien has been discharged.  If the agricultural producer fails to file the statement, the producer is liable for a $100 penalty and actual damages caused by the failure to file the statement.

Commercial fishermen raise the issue that their business dealings with fish processors is similar to farm products and as such the fishermen could benefit from product lien protections.

SUMMARY:

Commercial fishermen are given authority to exercise a processor's lien when they deliver fish to a fish processor.  This includes legally caught steelhead.  In the event the processor does not pay the fisherman within 20 days after the date payment was due, the fisherman may file a statement to that effect with the Department of Licensing.  A processor lien filed within 20 days after the due date of payment from the processor to the producer represents a first priority lien over all other liens and security interests, regardless of when the other lien or security interests were filed.

The processor's lien terminates six months after either the date of filing or the date of attachment, whichever is later unless a suit to foreclose the lien has been filed.

Fiscal Note:      none requested

Senate Committee - Testified: Steve Arbaugh, Cindy Halstrom, Maritime Seafood