livestock operations,

Time and time again I here business clients who are concerned about protecting their rights to collect against a customer by being concerned that “it might offend them.”  Liens are a perfect example of this.

Under recent Iowa Law, contractors who work on residential structures need to file a notice of commencement of work with the Secretary of State. This notice puts the lender, the home owner and anybody else working on the project that work has begun. This is important as failure to file this notice will prevent a contractor from placing a lien against the finished product.  While very few people would be offended by a bank telling them they  need a lien (which is what a mortgage is) against your property  to make sure you pay as promised, contractors are concerned that those same property owners will have their dander up about a potential lien filing by a contractor. 

It isn’t limited to just contractors. If a farm operator custom feeds for a third party owner, that feeder has a right to file a lien to ensure payment. The lien must be filed with in so many days of the livestock arriving at the property or the lien is not enforceable. Again, the producer sometimes shy’s away from protecting its rights to be paid by the owner of the animals for fear of offending. Feed suppliers can also file a lien to make sure that the feed provided to the livestock is paid back to the party delivering the feed on credit. Failure to protect yourself as a contract feeder or a feed supplier for fear of offending the customer may result in the t  rather offensive outcome of being “out of the money” when the customer files for bankruptcy or other wise doesn’t  have enough money to pay all the creditors.