44-11-103 - Bond of applicants Conditions Trust agreement in lieu of bond Actions for breach of conditions.
44-11-103. Bond of applicants Conditions Trust agreement in lieu of bond Actions for breach of conditions.
(a) (1) Each applicant for a license to operate and conduct a community sale shall file a bond with the department.
(2) The bond shall be in the principal amount of ten thousand dollars ($10,000); provided, that if the commissioner is of the opinion that the volume of business and the nature of the operation is such as to render a bond of ten thousand dollars ($10,000) inadequate, then the commissioner, after reasonable notice to the operator of the community sale, may require that the amount of the bond be increased, but the amount shall not exceed the average gross receipts for livestock sold through the community sale at the several sales held during the preceding twelve (12) months, or during the period for which the community sale has been operated if it has been operated for less than twelve (12) months; and provided further, that in no event shall the bonds exceed twenty-five thousand dollars ($25,000).
(3) The bonds shall be conditioned for the prompt remittance to consignors of the proceeds from any sale or exchange of livestock, or damage caused a purchaser or the general public as provided in this chapter.
(b) Aggrieved persons are authorized to bring suits for the breach of the condition of the bonds in the courts of record.
(c) The bond shall be executed by a corporate surety and shall not be cancelled without thirty (30) days' written notice to the department.
(d) In lieu of filing a bond, the operator of a community sale may deliver to the department the receipt of a duly authorized bank or trust company in this state showing the deposit in trust with the bank or trust company of cash or other securities endorsed in blank by the owner, and of a market value at least to an amount equal to the amount of any bond that would have been required if a bond had been submitted. The cash or securities shall be deposited in trust, and the trust agreement shall be conditioned as in the case of bonds, and an action for recovery against the deposit or securities may be brought in the same manner as in the case of an action for recovery on a bond filed under this section.
(e) Any receipt shall be accompanied by certificates from clerks of the courts of the county and the county register that there are no unsatisfied judgments against the operator of the community sale of record in the respective courts or in the office of the register of the county.
(f) The trust agreement shall not be terminated and the funds and securities in the trust shall not be paid out nor disbursed from the trust except upon the final order, judgment, or decree of a court, or the written approval of the commissioner in the settlement of a claim against the operator.
(g) The commissioner is authorized to dispense with the foregoing bonding provisions where a similar bond has been executed pursuant to any federal law, and if the commissioner finds the bond to be acceptable, it may be treated by the commissioner as a compliance with this section.
[Acts 1957, ch. 208, § 3; 1961, ch. 65, § 1; T.C.A., § 44-2303.]