60-02.1 Grain Buyers

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CHAPTER 60-02.1GRAIN BUYERS60-02.1-01. Definitions. In this chapter, unless the context or subject matter otherwiserequires:1."Commission" means the public service commission.2."Credit-sale contract" means a written contract for the sale of grain pursuant to which the sale price is to be paid or may be paid more than thirty days after the delivery or release of the grain for sale and which contains the notice provided in subsection 7 of section 60-02.1-14. If a part of the sale price of a contract for the sale of grain is to be paid or may be paid more than thirty days after the delivery or release of the grain for sale, only such part of the contract is a credit-sale contract.3."Facility" means a structure in which grain purchased by a grain buyer is received or held.4."Facility-based grain buyer" means a grain buyer who operates a facility licensed under the United States Warehouse Act [7 U.S.C. 241-273] where grain is received.5."Grain" means wheat, durum, oats, rye, barley, buckwheat, flaxseed, speltz, safflower, sunflower seeds, tame mustard, peas, beans, soybeans, corn, clover, millet, alfalfa, and any other commercially grown grain or grass seed. "Grain" does not include grain or grass seeds owned by or in the possession of the grain buyer which have been cleaned, processed, and specifically identified for an intended use of planting for reproduction and for which a warehouse receipt has not been issued.6."Grain buyer" means any person, other than a public warehouseman as defined in chapter 60-02, who purchases or otherwise merchandises grain for compensation. The term does not include:a.A producer of grain who purchases grain from other producers to complete a carload or truckload in which the greater portion of the load is grain grown by the producer or on-farm feedlot operations in which at least fifty percent of the livestock is owned by the owner of the farm.b.A person who is permitted to sell seed under chapter 4-09, if that person buys grain only for processing and subsequent resale as seed.c.A person who is an authorized dealer or agent of a seed company holding a permit in accordance with section 4-09-14.4.7."Noncredit-sale contract" means a contract for the sale of grain other than a credit-sale contract.8."Receipts" means scale tickets, checks, or other memoranda given by a grain buyer for, or as evidence of, the receipt or sale of grain except when such memoranda was received as a result of a credit-sale contract.9."Roving grain buyer" means a grain buyer who does not operate a facility where grain is received.60-02.1-02. Commission - Powers and duties. The duties imposed and the powersconferred by this chapter devolve upon the commission.60-02.1-03. Duties and powers of the commission. The commission has the duty andpower to:Page No. 11.Exercise general supervision of grain buyers of this state.2.Investigate all complaints of fraud and injustice, unfair practices, and unfair discrimination.3.Examine and inspect, during ordinary business hours, any books, documents, and records.4.Make all proper rules for carrying out and enforcing any law in this state regarding grain buyers.60-02.1-04.Federal licensed inspector - Appointed by commission.Thecommission may employ a federal licensed inspector whose duties are hereinafter prescribed, and such other employees as may be necessary to carry out the provisions of this chapter.60-02.1-05. Grain marketing - Procedure for resolving disputes.1.If any dispute or disagreement arises between the person receiving and the person delivering grain as to the proper grade, dockage, vomitoxin level, moisture content, or protein content of any grain, an average sample of at least three pints [1.65 liters] of the grain in dispute may be taken together by both interested parties. The sample must be certified by each party as a true and representative sample of the grain in dispute on the day the grain was transferred. The sample must be forwarded in a suitable container by parcel post or express, prepaid with the name and address of both parties for inspection by a federal licensed inspector, or a mutually agreed-upon third party, who will examine the grain and adjudge what grade, dockage, vomitoxin level, moisture content, or protein content the sample of grain is entitled to under the inspection rules and grades adopted by the secretary of agriculture of the United States. The person requesting the inspection service shall pay for the inspection. If the grain in question is damp, otherwise out of condition, or if moisture content is in dispute, the sample must be placed in an airtight container. Payment for the grain involved in the dispute must be made and accepted on the basis of the determination made by the federal licensed inspector or third party. However, all other quality factors may also be considered in determining the price of the grain. An appeal of the determination made by a third party other than a federal licensed inspector may be made to a federal licensed inspector.An appeal of thedetermination made by a federal licensed inspector may be made as provided under the United States Grain Standards Act [Pub. L. 103-354; 108 Stat. 3237; 7 U.S.C. 79(c) and (d)] and under 7 CFR 800.125-800.140. A person not abiding by a final determination is liable for damage resulting from not abiding by the determination.2.If any dispute or disagreement arises between the person delivering grain and the person receiving grain as to the determination of quality factors of grain purchased or delivered in the state for which inspection rules and grades have not been adopted by the secretary of agriculture of the United States, an average sample of at least three pints [1.65 liters] of the grain in dispute may be taken together by the interested parties.The sample must be certified by each party as a true andrepresentative sample of the grain in dispute on the day the grain was transferred. If the grain is damp or otherwise out of condition, the sample must be placed in an airtight container. The sample must be forwarded in a suitable container by parcel post or express, prepaid with the name and address of both parties, for inspection by a federal licensed inspector, or a mutually agreed-upon third party, who may examine the grain and determine the quality factors in dispute.The personrequesting the inspection service shall pay for the inspection. The determination made by the inspector, or the third party, must be used in the settlement of the dispute.60-02.1-06. Notice of procedures for resolving disputes over grain. A facility-basedgrain buyer shall post a notice containing the procedures specified in section 60-02.1-05 forPage No. 2resolving disputes. The commission shall prescribe the form of the notice and shall provide a copy of the notice to each facility-based grain buyer. The facility-based grain buyer shall post the notice in the grain inspection room of the facility. The notice must specifically mention that the procedure for resolving disputes applies to the grade, dockage, moisture content, and protein content of grain and to the quality factors of grain for which inspection rules and grades have not been adopted by the secretary of agriculture of the United States.60-02.1-07. Grain buyer license - How obtained - Fee - Financial statement. Grainbuyers must obtain an annual license from the commission. Except as provided in this section, each license expires on July thirty-first of each year. When a licensee's initial license is issued effective after May thirty-first, that license expires on July thirty-first of the following year. A facility-based grain buyer must obtain a license for each receiving location operated in the state. If a grain buyer operates two or more facilities in the same city or siding, in conjunction with each other and with the same working force, and where but one set of books and records is kept for all such facilities, and scale tickets and checks of but one series are issued for the grain, purchased, only one license is required for the operation of all such facilities. The annual license fee for a facility-based grain buyer is three hundred dollars and a license renewal application that is received after July fifteenth must be assessed an additional one hundred dollar fee per receiving location.If required to obtain United States department of agriculture approval of the commission'sgrain buyer inspection program, the commission may require that grain buyers submit a current financial statement prepared in accordance with generally accepted accounting principles. A financial statement furnished under this section is a confidential trade secret and is not a public record.60-02.1-07.1. Roving grain buyer license - How obtained - Fee. Roving grain buyersthat purchase, solicit, merchandise, or take possession of grain in this state must obtain an annual license from the commission. Except as provided in this section, each license expires on July thirty-first of each year.When a licensee's initial license is issued effective after Maythirty-first, that license expires on July thirty-first of the following year. The annual license fee for a roving grain buyer is two hundred dollars, and a license renewal application that is received after July fifteenth must be assessed an additional one hundred dollar fee.60-02.1-08. Bond filed by grain buyer. Before any license is issued to any grain buyerunder this chapter, the applicant for such license shall file a bond with the commission which must:1.Be in a sum not less than five thousand dollars.2.Be continuous, unless the corporate surety by certified mail notifies the licensee and the commission that the surety bond will be canceled ninety days after receipt of the notice of cancellation.3.Run to the state of North Dakota for the benefit of all persons selling grain to or through the grain buyer.4.Be conditioned:a.For the faithful performance of the licensee's duties as a grain buyer.b.For compliance with the provisions of law and the rules of the commission relating to the purchase of grain by such grain buyer.5.For facility-based grain buyers, specify the location of each facility intended to be covered by such bond.6.Be for the specific purpose of:Page No. 3a.Protecting the sellers of grain.b.Covering the costs incurred by the commission in the administration of the licensee's insolvency.7.Not accrue to the benefit of any person entering into a credit-sale contract with a grain buyer.8.In no event shall the aggregate liability of the surety under a bond accumulate for each successive annual license renewal period during which such bond is in force but, for losses during any annual license renewal period, shall be limited in the aggregate to the bond amount stated or changed by appropriate endorsement or rider.The commission may require an increase in the amount of any bond, from time to time, as it deems necessary to accomplish the purposes of this section. The surety on such a bond must be a corporate surety company, approved by the commission, and authorized to do business within the state. The commission may accept cash, a negotiable instrument, or a bond executed by personal sureties in lieu of a surety bond when, in its judgment, such cash, negotiable instrument, or personal surety bond properly will protect the holders of outstanding receipts. Only one bond may be required for any series of facilities operated by a facility-based grain buyer, and such bond must be construed to cover such facilities as a whole and not a specific amount for each.60-02.1-09. Bond cancellation - Release of surety. The surety on a bond is releasedfrom all future liability accruing on the bond after the expiration of ninety days from the date of receipt by the commission of notice of cancellation by the surety or on a later date specified by the surety. This provision does not operate to relieve, release, or discharge the surety from any liability already accrued or which accrues before the expiration of the ninety-day period. Unless the grain buyer files a new bond at least thirty days before liability ceases, the commission, without hearing, shall immediately suspend the grain buyer's license and the suspension may not be removed until a new bond has been filed and approved by the commission.60-02.1-10.Grain buyer license to be posted or carried - Penalty.The licenseobtained by a facility-based grain buyer shall be posted in a conspicuous place in the buyer's facility. A roving grain buyer shall have the buyer's license in possession at all times. A grain buyer who transacts business without first procuring a license and giving a bond is guilty of a class B misdemeanor.60-02.1-11. Revocation and suspension. The commission may suspend or revoke thelicense of any grain buyer for cause upon notice and hearing.Notwithstanding any otherprovisions of this chapter, the license of a grain buyer must automatically be suspended for failure at any time to have or to maintain either a bond or insurance policy in the amount and type required. During a suspension of a license a facility-based grain buyer, upon the commission's approval, may operate its facility and purchase or redeliver grain previously received, but may not receive additional grain for purchase, shipping, or processing. Grain may be sold only with the prior approval of the commission.60-02.1-12. Scale ticket - Contents. Every grain buyer, upon receiving grain, shallissue a uniform scale ticket or comparable receipt for each load of grain received. Receipts must be numbered consecutively and one copy of each receipt must be retained and remain as a permanent record. The original receipt must be delivered to the person from whom the grain is received, upon receipt of each load of grain.60-02.1-13. Penalty. Any person who violates any provision of this chapter or any ruleadopted pursuant to this chapter, if punishment is not specifically provided for, is guilty of an infraction.Page No. 460-02.1-14.Credit-sale contracts.A grain buyer may not purchase grain by acredit-sale contract except as provided in this section. All credit-sale contracts must be in writing and must be consecutively numbered at the time of printing the contract. The grain buyer shall maintain an accurate record of all credit-sale contract numbers, including the disposition of each numbered form, whether by execution, destruction, or otherwise. Each credit-sale contract must contain or provide for all of the following:1.The seller's name and address.2.The conditions of delivery.3.The amount and kind of grain delivered.4.The price per unit or basis of value.5.The date payment is to be made.6.The duration of the credit-sale contract.7.Notice in a clear and prominent manner that the sale is not protected by the bond coverage provided for in section 60-02.1-08.However, if the grain buyer hasobtained bond coverage in addition to that required by section 60-02.1-08 and the coverage extends to the benefit of credit-sale contracts, the grain buyer may state that fact in the credit-sale contract along with the extent of such coverage.The contract must be signed by both parties and executed in duplicate. One copy must be retained by the grain buyer and one copy must be delivered to the seller. Upon revocation, termination, or cancellation of a grain buyer's license, the payment date for all credit-sale contracts, at the seller's option, must be advanced to a date not later than thirty days after the effective date of the revocation, termination, or cancellation, and the purchase price for all unpriced grain must be determined as of the effective date of revocation, termination, or cancellation in accordance with all other provisions of the contract. When a facility is transferred under this chapter, credit-sale contracts may be assigned to another licensed facility-based grain buyer or public warehouseman.60-02.1-15.Discrimination by grain buyer prohibited.A grain buyer may notdiscriminate:1.In the buying, selling, receiving, and handling of grain or in the charges made or the service rendered to owners of purchased grain;2.In the receiving of grain offered for sale, but this chapter may not be construed to require a processor to receive or purchase any lot or kinds of grain;3.In regard to the persons offering such grain for sale; or4.Between points or stations except as the marketing factors or transportation costs or grain quality premiums may warrant.A grain buyer is not required to receive any grain that is heating or otherwise out of condition. A facility-based grain buyer shall post grain prices paid in a conspicuous place in the office or driveway of the buyer's place of business.60-02.1-16. Records required to be kept by grain buyers. Each grain buyer shallkeep such accounts, records, and memoranda concerning the buyer's dealing as such grain buyer as from time to time may be required by the commission and shall make such reports of purchases of grain as may be required by the rules made by the commission. The commission at all times shall have access to such accounts, records, and memoranda.Page No. 560-02.1-17. Reports to be made by grain buyers - Penalty for failure. Each licensedand bonded grain buyer shall:1.Prepare for each month a report giving facts and information called for on the form of report prepared by the commission. The report must contain or be verified by a written declaration that it is made under the penalties of perjury. The report may be called for more frequently if the commission deems it necessary.Informationpertaining to the volume of grain handled is a confidential trade secret and is not a public record. The commission may make this information available for use by other governmental entities, but the information may not be released by those entities in a manner that jeopardizes the confidentiality of individual licensees.2.File the report with the commission not later than the last day of the following month. Failure to file this report promptly will be considered cause for revoking the grain buyer license after due notice and hearing.3.Keep a separate account of the grain business, if the grain buyer is engaged in handling or selling any other commodity, and under no circumstances may the grain account and other accounts be mixed.The commission may refuse to renew a license to any grain buyer who fails to make a required report.60-02.1-18. Standard weights to be used - Exception. A person purchasing grain maynot use any measure for such grain other than the standard bushel, and a number of pounds may not be used or called a bushel other than the number of pounds provided by law as the standard weight of the kind of grain in question, except that during the months of October and November, not exceeding eighty-two pounds [37.19 kilograms], and during the months of December and January, not exceeding seventy-six pounds [34.47 kilograms], may be used as the standard weight per bushel of new ear corn.60-02.1-19. Federal grades to control - Grades to be posted. All grain buyers shallpurchase grain, except dry edible beans, in accordance with the official grades established from time to time by the secretary of agriculture of the United States, except as otherwise provided in rules and regulations applicable thereto adopted by federal officials pursuant to law.Afacility-based grain buyer shall post in a conspicuous place in the buyer's facility the official grades so established and also any change that may be made from time to time. A grain buyer of dry edible beans shall purchase and deliver beans in accordance with the buyer's policy, which must be filed with the commission and, if applicable, posted in a conspicuous place in the buyer's facility. Other grading standards may be used if mutually agreed to in writing by the grain buyer and the owner of the grain.However, the owner may demand the use of federal gradingstandards. After hearing, the commission may prohibit the use of nonfederal grades.60-02.1-20. Grading of grain - Penalty. All grain buyers before testing for grade anygrain handled by them shall remove therefrom and make due allowance for any dockage of such grain made by reason of the presence of straw, weed seeds, dirt, or any other foreign matter. Any grain buyer within this state who violates this provision is guilty of a class B misdemeanor.60-02.1-21. Grain to be kept insured for benefit of owner by grain buyer. A licensemay not be issued to a facility-based grain buyer unless all company-owned and unconverted scale ticket grain is kept fully insured at the expense of the grain buyer for the benefit of the owner at the current market value of the grain against loss by fire, lightning, internal explosion, windstorm, cyclone, tornado, and such other risks of direct physical loss as provided by the insurer in a policy approved by the insurance commissioner. An insurance policy may not be transferred or assigned to any person for any purpose.60-02.1-22. Insurance - Cancellation - Suspension of license. An insurance companyshall give at least sixty days' notice to the commission and the insured by registered mail return receipt requested before cancellation of an insurance policy required in section 60-02.1-21.Page No. 6Unless the grain buyer files proof of new or renewed insurance at least thirty days before the existing policy ceases, the commission, without hearing, shall immediately suspend the grain buyer's license and the suspension may not be removed until a new policy has been filed and approved by the commission.60-02.1-23. Destruction of grain - First lien by holder of outstanding receipt. Theholder of an unconverted scale ticket or other comparable receipt issued by any facility-based grain buyer shall have a first lien, to the extent of the value of the grain at the time of loss at the place where held, on all insurance of the grain buyer for any loss sustained by the receiptholder, on account of the loss of such grain by fire, tornado, or any other cause covered by such insurance policy.60-02.1-24.Destruction of facility - Duty to notify commission.Repealed byS.L. 2005, ch. 588, </DIV></DIV></DIV> </DIV>  <DIV></DIV> <DIV></DIV> <DIV></DIV> <DIV></DIV>  <DIV id=footer> <DIV class=container> Copyright © 2012-2022 Laws9.Com All rights reserved.  <A href="/contactus.html">Contact Us</A> | <A href="/aboutus.html">About Us</A> | <A href="/terms.html">Terms</A> | <A href="/privacy.html">Privacy</A> </DIV> </DIV> </BODY></HTML>

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North Dakota Codes and Statutes

60-02.1 Grain Buyers