Key Points of Grain Dealers Act
Farm produce means one or more of dry edible beans, soy beans, small grains, cereal grains and corn. Farm produce includes organic produce noted above.
Produce Grade as stated upon any warehouse receipt or price later agreement shall conform to official grade standards as established by the Michigan Department of Agriculture & Rural Development (MDARD); if not established, then United States grade standards as established by the Bureau of Agricultural Economics of the United States Department of Agriculture.
Acknowledgement form (scale ticket) is a sequential written or electronic ticket issued by a grain dealer to a farm produce owner which identifies the farm produce being transferred from the physical jurisdiction of the owner to the grain dealer. "A statement that unless the parties agree to another disposition within thirty days of the delivery to the grain dealer, the farm produce transaction is a price later agreement transaction" shall be printed on all acknowldgement forms. Until a diposition ocurrs or thirty days, farm produce delivered to a grain dealer is in open storage and title remains with the producer.
If dealer receives produce at truck or facility, a permanent acknowledgement form shall include date of transfer, weight, commodity, dealer's name and address. If produce is obtained by a dealer, but not delivered to a dealer, a temporary acknowledgement form shall include estimated quantity, commodity, dealer's name and address, and truck driver's name.
Cash sale means farm produce whose title is transferred only after a price is decided upon not later than the time of delivery and in which payment is made to the grower or producer by check, cash, money order, wire transfer, or draft within ten days or delivery, or a credit to depositor's account and statement to depositor within ten days of delivery.
Grain or feed bank is the storage of farm produce on a nonnegotiable warehouse receipt intended to be partially and/or periodically withdrawn by the owner.
Warehouse receipt is a sequentially written or electronically issued receipt by the grain dealer to a farm produce owner upon acceptance of the farm produce for storage in the grain dealer's facility. Title of the warehouse receipt remains with the producer. The warehouse receipt must include location of receipt, date of receipt, rate of storage, weight, percentage of dockage and grade, whether negotiable or non-negotiable, dealer's signature, ownership interests, any advances or liabilities incurred, statement that receipt is subject to act and rules promulgated thereunder and an expiration date. This information must be placed on an MDARD approved form.
Price later agreement (PLA) is a sequentially written or electronically issued agreement by which a grain dealer takes title to farm produce for a sale price which is not fixed at time of delivery. Unless the parties agree to another disposition within thirty days of the delivery to the grain dealer, the farm produce transaction is a price later agreement transaction.
The approved price later agreement form shall include:
- Class and grade of produce
- Expiration date
- Date of receipt
- Charges for handling, if any
- Dealer's & producer's address and signature (producer's signature not required if no disposition within 30 days).
- Statement that receipt is subject to act and rules promulgated thereunder and an expiration date.
Commingling of fungible farm produce is allowed unless agreement requiring segregation or custom, and produce is of like kind and grade. Depositors shall own mass in common and the grain dealer shall be liable, severally to each depositor for the care and delivery of his share.
Insurance is required by a grain dealer on all farm produce, stored through an authorized insurer, against loss by fire, explosion, lightning or windstorm to the extent of full market value. Failure to do so is just cause for revocation. The average market value on date of loss is basis for settlement.
Director may act as agent of holders of warehouse receipts and price later agreements during a procedure of suspension or revocation and seize the assets of the grain dealer. Upon revocation of the grain dealer's license, the director may liquidate the assets of the grain dealer and provide for an distribution as provided for in the act.