[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 3140 Introduced in Senate (IS)]

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115th CONGRESS
  2d Session
                                S. 3140

   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

                             June 26, 2018

   Mr. Inhofe (for himself, Mr. Daines, Mr. Moran, and Mrs. Fischer) 
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 2018'' or the ``SALE Act of 2018''.

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 paragraphs (2) and 
        (3), 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 $250,000.
            ``(3) Waiver.--
                    ``(A) In general.--A dealer and a cash seller may 
                voluntarily waive the applicability of this section to 
                the dealer and cash seller through a written agreement 
                described in subparagraph (B) that is signed before any 
                sale to which the written agreement applies takes 
                place.
                    ``(B) Written agreement.--A written agreement 
                referred to in subparagraph (A) shall indicate whether 
                the written agreement applies to--
                            ``(i) 1 sale;
                            ``(ii) all sales before a specific date; or
                            ``(iii) all sales until the dealer or cash 
                        seller terminates the agreement in writing.
                    ``(C) Effect on payment terms.--A waiver under 
                subparagraph (A) shall not affect the payment terms of 
                the sale.
            ``(4) 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) Enforcement.--If a dealer fails to perform the duties 
required by subsection (b), the Secretary shall take such action as is 
necessary--
            ``(1) to enforce the trust, including by appointing an 
        independent trustee; and
            ``(2) to preserve the assets of the trust.
    ``(d) 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.
    ``(e) Notice to Lien Holders.--Not later than 15 business days 
after the date on which a dealer receives notice under subsection 
(d)(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.
    ``(f) Purchase of Livestock Subject to Trust.--
            ``(1) In general.--Notwithstanding section 1324 of the Food 
        Security Act of 1985 (7 U.S.C. 1631), a buyer in the ordinary 
        course that purchases livestock that is held in trust by a 
        dealer under subsection (b), including from a dealer that 
        engages in farming operations, shall receive good title to the 
        livestock free of the dealer trust--
                    ``(A) if the buyer receives the livestock in 
                exchange for payment of new value; and
                    ``(B) without regard to whether--
                            ``(i) the dealer trust has been preserved 
                        in accordance with this section; or
                            ``(ii) the buyer knows of the existence of 
                        the dealer 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.
    ``(g) 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 (f)(1)(A) if the 
transfer is--
            ``(1) in satisfaction of an antecedent debt; or
            ``(2) to a secured party pursuant to a security 
        agreement.''.
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