State Codes and Statutes
Statutes > Texas > Agriculture-code > Title-6-production-processing-and-sale-of-animal-products > Chapter-181-payment-for-raw-milk
AGRICULTURE CODE
TITLE 6. PRODUCTION, PROCESSING, AND SALE OF ANIMAL PRODUCTS
SUBTITLE D. DAIRY PRODUCTS
CHAPTER 181. PAYMENT FOR RAW MILK
Sec. 181.001. DEFINITIONS. In this chapter:
(1) "Cooperative association" means any group in which farmers
act together in the market preparation, processing, or marketing
of farm products or any association organized under Chapter 52 of
this code.
(2) "Dairy farmer" means a farmer engaged in the business of
producing milk for sale to milk processors directly or through a
cooperative association of which the dairy farmer is a member.
(3) "Milk processor" means a person who operates a milk, milk
products, or frozen desserts processing plant that is located in
Texas.
(4) "Purchase price" means an amount of money, based on
estimated butterfat content at the time of delivery, that a milk
processor agrees to pay a dairy farmer for a purchase of raw
milk.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987. Amended by Acts 1989, 71st Leg., ch. 676, Sec. 1, eff.
Sept. 1, 1989.
Sec. 181.0015. APPLICABILITY OF CHAPTER. When a dairy farmer
sells or markets milk through a cooperative association of which
the dairy farmer is a member, the cooperative association is
considered a dairy farmer for purposes of this chapter.
Added by Acts 1989, 71st Leg., ch. 676, Sec. 2, eff. Sept. 1,
1989.
Sec. 181.002. PAYMENTS HELD IN TRUST. (a) Except as provided
by Subsections (b) and (g) of this section, a milk processor
shall hold in trust all payments received from the sale of milk
for the benefit of the dairy farmer from whom the milk was
purchased until the dairy farmer has received full payment of the
purchase price for the milk. For the purposes of this subsection,
funds placed in escrow in compliance with Subsections (b) through
(e) of this section are held in trust.
(b) Except as provided by Subsection (g) of this section, a
dairy farmer who sells milk to a milk processor may require the
milk processor to establish an escrow account for the benefit of
the dairy farmer. If a dairy farmer requires a milk processor to
establish an escrow account under this subsection, the milk
processor shall deposit in the escrow account, in the manner
provided by Subsections (c) through (e) of this section, all
payments received from the sale of any milk or dairy product
until the dairy farmer has received full payment of the purchase
price for the milk.
(c) A milk processor required to establish an escrow account
under this section shall, on receipt of a payment from the sale
of milk or dairy products, deposit into the account a sum of
money determined by multiplying the total amount of all payments
received by the milk processor from the sale of milk or dairy
products by the fraction determined by dividing the total
quantity of milk purchased by the milk processor for sale as milk
or dairy products into the quantity of milk sold by the dairy
farmer to the milk processor. The milk processor shall continue
to make payments into the escrow account until the dairy farmer
has received full payment of the purchase price for the milk.
(d) An escrow account required under this section shall be
established for the benefit of the dairy farmer as a segregated,
interest-bearing account with a financial institution located in
this state the deposits of which are insured by the Federal
Deposit Insurance Corporation or the Federal Savings and Loan
Insurance Corporation. If a milk processor is required to
establish more than one escrow account under this section, the
milk processor may combine the accounts into a single account. If
the funds accumulated in a combined escrow account are
insufficient to pay all the dairy farmers who have not received
full payment and for whose benefit the account was established,
the agent of the institution with whom the escrow account is
established shall distribute the funds in proportion to the
amount then due to each dairy farmer.
(e) On presentation of proof of identity satisfactory to an
agent of the institution with which the escrow account is
established, the agent shall promptly distribute any funds
accumulated for the benefit of the dairy farmer to the dairy
farmer or, if required by an applicable federal milk marketing
order, to the federal milk administration.
(f) Funds held in trust by a milk processor or in an escrow
account are the property of the dairy farmer.
(g) A milk processor is not required to establish an escrow
account or maintain payments in trust under Subsection (a) or (b)
of this section for a payment if:
(1) full payment of the purchase price is not received, and the
dairy farmer does not give written notice to the milk processor,
by the end of the 30th day after the final date for payment of
the purchase price as specified by Section 181.003 of this code;
or
(2) a payment instrument received by the dairy farmer is
dishonored, and the dairy farmer does not give written notice to
the milk processor, by the end of the 15th business day after the
day that the notice of dishonor was received.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987. Amended by Acts 1989, 71st Leg., ch. 676, Sec. 3, eff.
Sept. 1, 1989.
Sec. 181.003. TIME AND METHOD OF PAYMENT FOR PURCHASE. (a) A
milk processor may not purchase raw milk from a dairy farmer
unless:
(1) payment of the purchase price is made according to the
provisions prescribed by an applicable federal milk marketing
order;
(2) any additional provisions are agreed on by both the dairy
farmer or his agent and the milk processor; and
(3) the medium of exchange used is cash, a check for the full
amount of the purchase price, or a wire transfer of money in the
full amount.
(b) For purposes of this chapter, a payment delivered by a milk
processor to the applicable federal milk market administrator on
behalf of a dairy farmer in compliance with the terms of an
applicable federal milk marketing order is considered to be
delivery of payment to the dairy farmer.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987. Amended by Acts 1989, 71st Leg., ch. 676, Sec. 4, eff.
Sept. 1, 1989.
Sec. 181.004. COOPERATIVE TRANSACTIONS. This chapter does not
apply to transactions between a cooperative association, while
acting as a marketing agent, and its members.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987.
Sec. 181.005. DAMAGES. A milk processor who fails to pay for
raw milk as provided by this chapter is liable to the dairy
farmer for:
(1) the purchase price of the raw milk;
(2) interest on the purchase price at the highest legal rate,
from the date possession is transferred until the date the
payment is made in accordance with this chapter; and
(3) a reasonable attorney's fee for the collection of the
payment.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987.
State Codes and Statutes
Statutes > Texas > Agriculture-code > Title-6-production-processing-and-sale-of-animal-products > Chapter-181-payment-for-raw-milk
AGRICULTURE CODE
TITLE 6. PRODUCTION, PROCESSING, AND SALE OF ANIMAL PRODUCTS
SUBTITLE D. DAIRY PRODUCTS
CHAPTER 181. PAYMENT FOR RAW MILK
Sec. 181.001. DEFINITIONS. In this chapter:
(1) "Cooperative association" means any group in which farmers
act together in the market preparation, processing, or marketing
of farm products or any association organized under Chapter 52 of
this code.
(2) "Dairy farmer" means a farmer engaged in the business of
producing milk for sale to milk processors directly or through a
cooperative association of which the dairy farmer is a member.
(3) "Milk processor" means a person who operates a milk, milk
products, or frozen desserts processing plant that is located in
Texas.
(4) "Purchase price" means an amount of money, based on
estimated butterfat content at the time of delivery, that a milk
processor agrees to pay a dairy farmer for a purchase of raw
milk.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987. Amended by Acts 1989, 71st Leg., ch. 676, Sec. 1, eff.
Sept. 1, 1989.
Sec. 181.0015. APPLICABILITY OF CHAPTER. When a dairy farmer
sells or markets milk through a cooperative association of which
the dairy farmer is a member, the cooperative association is
considered a dairy farmer for purposes of this chapter.
Added by Acts 1989, 71st Leg., ch. 676, Sec. 2, eff. Sept. 1,
1989.
Sec. 181.002. PAYMENTS HELD IN TRUST. (a) Except as provided
by Subsections (b) and (g) of this section, a milk processor
shall hold in trust all payments received from the sale of milk
for the benefit of the dairy farmer from whom the milk was
purchased until the dairy farmer has received full payment of the
purchase price for the milk. For the purposes of this subsection,
funds placed in escrow in compliance with Subsections (b) through
(e) of this section are held in trust.
(b) Except as provided by Subsection (g) of this section, a
dairy farmer who sells milk to a milk processor may require the
milk processor to establish an escrow account for the benefit of
the dairy farmer. If a dairy farmer requires a milk processor to
establish an escrow account under this subsection, the milk
processor shall deposit in the escrow account, in the manner
provided by Subsections (c) through (e) of this section, all
payments received from the sale of any milk or dairy product
until the dairy farmer has received full payment of the purchase
price for the milk.
(c) A milk processor required to establish an escrow account
under this section shall, on receipt of a payment from the sale
of milk or dairy products, deposit into the account a sum of
money determined by multiplying the total amount of all payments
received by the milk processor from the sale of milk or dairy
products by the fraction determined by dividing the total
quantity of milk purchased by the milk processor for sale as milk
or dairy products into the quantity of milk sold by the dairy
farmer to the milk processor. The milk processor shall continue
to make payments into the escrow account until the dairy farmer
has received full payment of the purchase price for the milk.
(d) An escrow account required under this section shall be
established for the benefit of the dairy farmer as a segregated,
interest-bearing account with a financial institution located in
this state the deposits of which are insured by the Federal
Deposit Insurance Corporation or the Federal Savings and Loan
Insurance Corporation. If a milk processor is required to
establish more than one escrow account under this section, the
milk processor may combine the accounts into a single account. If
the funds accumulated in a combined escrow account are
insufficient to pay all the dairy farmers who have not received
full payment and for whose benefit the account was established,
the agent of the institution with whom the escrow account is
established shall distribute the funds in proportion to the
amount then due to each dairy farmer.
(e) On presentation of proof of identity satisfactory to an
agent of the institution with which the escrow account is
established, the agent shall promptly distribute any funds
accumulated for the benefit of the dairy farmer to the dairy
farmer or, if required by an applicable federal milk marketing
order, to the federal milk administration.
(f) Funds held in trust by a milk processor or in an escrow
account are the property of the dairy farmer.
(g) A milk processor is not required to establish an escrow
account or maintain payments in trust under Subsection (a) or (b)
of this section for a payment if:
(1) full payment of the purchase price is not received, and the
dairy farmer does not give written notice to the milk processor,
by the end of the 30th day after the final date for payment of
the purchase price as specified by Section 181.003 of this code;
or
(2) a payment instrument received by the dairy farmer is
dishonored, and the dairy farmer does not give written notice to
the milk processor, by the end of the 15th business day after the
day that the notice of dishonor was received.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987. Amended by Acts 1989, 71st Leg., ch. 676, Sec. 3, eff.
Sept. 1, 1989.
Sec. 181.003. TIME AND METHOD OF PAYMENT FOR PURCHASE. (a) A
milk processor may not purchase raw milk from a dairy farmer
unless:
(1) payment of the purchase price is made according to the
provisions prescribed by an applicable federal milk marketing
order;
(2) any additional provisions are agreed on by both the dairy
farmer or his agent and the milk processor; and
(3) the medium of exchange used is cash, a check for the full
amount of the purchase price, or a wire transfer of money in the
full amount.
(b) For purposes of this chapter, a payment delivered by a milk
processor to the applicable federal milk market administrator on
behalf of a dairy farmer in compliance with the terms of an
applicable federal milk marketing order is considered to be
delivery of payment to the dairy farmer.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987. Amended by Acts 1989, 71st Leg., ch. 676, Sec. 4, eff.
Sept. 1, 1989.
Sec. 181.004. COOPERATIVE TRANSACTIONS. This chapter does not
apply to transactions between a cooperative association, while
acting as a marketing agent, and its members.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987.
Sec. 181.005. DAMAGES. A milk processor who fails to pay for
raw milk as provided by this chapter is liable to the dairy
farmer for:
(1) the purchase price of the raw milk;
(2) interest on the purchase price at the highest legal rate,
from the date possession is transferred until the date the
payment is made in accordance with this chapter; and
(3) a reasonable attorney's fee for the collection of the
payment.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987.
State Codes and Statutes
Statutes >
Texas >
Agriculture-code >
Title-6-production-processing-and-sale-of-animal-products >
Chapter-181-payment-for-raw-milk AGRICULTURE CODE
TITLE 6. PRODUCTION, PROCESSING, AND SALE OF ANIMAL PRODUCTS
SUBTITLE D. DAIRY PRODUCTS
CHAPTER 181. PAYMENT FOR RAW MILK
Sec. 181.001. DEFINITIONS. In this chapter:
(1) "Cooperative association" means any group in which farmers
act together in the market preparation, processing, or marketing
of farm products or any association organized under Chapter 52 of
this code.
(2) "Dairy farmer" means a farmer engaged in the business of
producing milk for sale to milk processors directly or through a
cooperative association of which the dairy farmer is a member.
(3) "Milk processor" means a person who operates a milk, milk
products, or frozen desserts processing plant that is located in
Texas.
(4) "Purchase price" means an amount of money, based on
estimated butterfat content at the time of delivery, that a milk
processor agrees to pay a dairy farmer for a purchase of raw
milk.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987. Amended by Acts 1989, 71st Leg., ch. 676, Sec. 1, eff.
Sept. 1, 1989.
Sec. 181.0015. APPLICABILITY OF CHAPTER. When a dairy farmer
sells or markets milk through a cooperative association of which
the dairy farmer is a member, the cooperative association is
considered a dairy farmer for purposes of this chapter.
Added by Acts 1989, 71st Leg., ch. 676, Sec. 2, eff. Sept. 1,
1989.
Sec. 181.002. PAYMENTS HELD IN TRUST. (a) Except as provided
by Subsections (b) and (g) of this section, a milk processor
shall hold in trust all payments received from the sale of milk
for the benefit of the dairy farmer from whom the milk was
purchased until the dairy farmer has received full payment of the
purchase price for the milk. For the purposes of this subsection,
funds placed in escrow in compliance with Subsections (b) through
(e) of this section are held in trust.
(b) Except as provided by Subsection (g) of this section, a
dairy farmer who sells milk to a milk processor may require the
milk processor to establish an escrow account for the benefit of
the dairy farmer. If a dairy farmer requires a milk processor to
establish an escrow account under this subsection, the milk
processor shall deposit in the escrow account, in the manner
provided by Subsections (c) through (e) of this section, all
payments received from the sale of any milk or dairy product
until the dairy farmer has received full payment of the purchase
price for the milk.
(c) A milk processor required to establish an escrow account
under this section shall, on receipt of a payment from the sale
of milk or dairy products, deposit into the account a sum of
money determined by multiplying the total amount of all payments
received by the milk processor from the sale of milk or dairy
products by the fraction determined by dividing the total
quantity of milk purchased by the milk processor for sale as milk
or dairy products into the quantity of milk sold by the dairy
farmer to the milk processor. The milk processor shall continue
to make payments into the escrow account until the dairy farmer
has received full payment of the purchase price for the milk.
(d) An escrow account required under this section shall be
established for the benefit of the dairy farmer as a segregated,
interest-bearing account with a financial institution located in
this state the deposits of which are insured by the Federal
Deposit Insurance Corporation or the Federal Savings and Loan
Insurance Corporation. If a milk processor is required to
establish more than one escrow account under this section, the
milk processor may combine the accounts into a single account. If
the funds accumulated in a combined escrow account are
insufficient to pay all the dairy farmers who have not received
full payment and for whose benefit the account was established,
the agent of the institution with whom the escrow account is
established shall distribute the funds in proportion to the
amount then due to each dairy farmer.
(e) On presentation of proof of identity satisfactory to an
agent of the institution with which the escrow account is
established, the agent shall promptly distribute any funds
accumulated for the benefit of the dairy farmer to the dairy
farmer or, if required by an applicable federal milk marketing
order, to the federal milk administration.
(f) Funds held in trust by a milk processor or in an escrow
account are the property of the dairy farmer.
(g) A milk processor is not required to establish an escrow
account or maintain payments in trust under Subsection (a) or (b)
of this section for a payment if:
(1) full payment of the purchase price is not received, and the
dairy farmer does not give written notice to the milk processor,
by the end of the 30th day after the final date for payment of
the purchase price as specified by Section 181.003 of this code;
or
(2) a payment instrument received by the dairy farmer is
dishonored, and the dairy farmer does not give written notice to
the milk processor, by the end of the 15th business day after the
day that the notice of dishonor was received.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987. Amended by Acts 1989, 71st Leg., ch. 676, Sec. 3, eff.
Sept. 1, 1989.
Sec. 181.003. TIME AND METHOD OF PAYMENT FOR PURCHASE. (a) A
milk processor may not purchase raw milk from a dairy farmer
unless:
(1) payment of the purchase price is made according to the
provisions prescribed by an applicable federal milk marketing
order;
(2) any additional provisions are agreed on by both the dairy
farmer or his agent and the milk processor; and
(3) the medium of exchange used is cash, a check for the full
amount of the purchase price, or a wire transfer of money in the
full amount.
(b) For purposes of this chapter, a payment delivered by a milk
processor to the applicable federal milk market administrator on
behalf of a dairy farmer in compliance with the terms of an
applicable federal milk marketing order is considered to be
delivery of payment to the dairy farmer.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987. Amended by Acts 1989, 71st Leg., ch. 676, Sec. 4, eff.
Sept. 1, 1989.
Sec. 181.004. COOPERATIVE TRANSACTIONS. This chapter does not
apply to transactions between a cooperative association, while
acting as a marketing agent, and its members.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987.
Sec. 181.005. DAMAGES. A milk processor who fails to pay for
raw milk as provided by this chapter is liable to the dairy
farmer for:
(1) the purchase price of the raw milk;
(2) interest on the purchase price at the highest legal rate,
from the date possession is transferred until the date the
payment is made in accordance with this chapter; and
(3) a reasonable attorney's fee for the collection of the
payment.
Added by Acts 1987, 70th Leg., ch. 1083, Sec. 1, eff. Sept. 1,
1987.
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