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Arkansas Code Title 4. Business and Commercial Law § 4-56-102. Unlawful acts relating to secured interests on certain farm products

Current as of March 28, 2024 | Updated by FindLaw Staff

(a) It shall be unlawful for any person who buys soybeans, corn, wheat, rice, or milo from a person engaged in farming operations, or for any commission merchant or selling agent who sells soybeans, corn, wheat, rice, or milo for a person engaged in farming operations for a fee or commission, to knowingly fail to include as joint payee on the check or other instrument issued in payment for the farm products the name of any person disclosed by the seller as having a security interest in the farm products.

(b) It shall be unlawful for any person engaged in farming operations who sells soybeans, corn, wheat, rice, or milo to knowingly fail to disclose the names of any parties having a security interest in the farm products before accepting payment of the proceeds of the sale.

(c)(1) It shall be unlawful for a person who owes payment or other performance of an obligation under a security agreement to sell or otherwise dispose of soybeans, corn, wheat, rice, or milo used as collateral or any part thereof and to knowingly fail to pay to the secured party the amount of the proceeds from such sale or other disposition if the person:

(A) Has no right to sell or otherwise dispose of the farm products used as collateral; or

(B) Has the right to sell or otherwise dispose of the farm products used as collateral, provided that the secured party receives the proceeds from such sale or other disposition.

(2) Failure to pay the proceeds to the secured party within ten (10) days after the sale or other disposition of the collateral shall be prima facie evidence of a knowing failure to pay under this section.

(d) A violation of this section shall be a Class C felony.

(e) The terms used in this section shall have the same meaning as used in the Uniform Commercial Code, Acts 1961, No. 185, as amended.

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Cite this article: FindLaw.com - Arkansas Code Title 4. Business and Commercial Law § 4-56-102. Unlawful acts relating to secured interests on certain farm products - last updated March 28, 2024 | https://codes.findlaw.com/ar/title-4-business-and-commercial-law/ar-code-sect-4-56-102/

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