Also known as: nonpossessory agricultural lien · agricultural lien · nonpossessory lien
Written by attorneys · grounded in primary & secondary sources — see below
A statutory nonpossessory interest in farm products or their proceeds created in favor of a supplier of goods or services to a farming operation to secure payment for those goods or services.
Natalie Norris buys corn from a farmer who owes unpaid fertilizer bills to AgriGrow Corp. under a state statute creating a nonpossessory agricultural lien. Norris pays value, takes delivery, and has no knowledge of the lien. The lien remains unperfected at the time of the sale. Norris therefore takes the corn free of AgriGrow's claim.
Natasha Nielsen supplies seed to a farming partnership on credit with invoices stating payment comes from crop proceeds. The state statute grants Nielsen a nonpossessory agricultural lien that becomes effective upon delivery. Nielsen satisfies all perfection requirements under section 9-310 before the lien takes effect. The lien is therefore perfected from the moment it becomes effective.
Select any source to read its text and confirm it supports the definition.
Noelle North holds a nonpossessory agricultural lien in livestock that she initially perfects by possession. She later files a financing statement covering the same collateral. There is no gap between the two methods. The lien remains continuously perfected against third parties.
Norman Nash supplies feed to a hog operation and obtains a nonpossessory agricultural lien under state law. Before Nash perfects, a judgment creditor obtains a lien on the same livestock. The judgment lien arises before the agricultural lien is perfected. The agricultural lien is subordinate to the judgment creditor's rights.
Nadia Novak holds a nonpossessory agricultural lien on wheat. The farmer sells the wheat to a buyer without Novak's authorization to release the lien. The wheat is identifiable in the buyer's possession. Novak's lien continues in the wheat after the sale.
Yes. Article 9 expressly includes agricultural liens within its scope even though they arise by statute rather than by contract. The rules on attachment, perfection, and priority therefore apply to such liens unless displaced by another statute.
It is treated as a statutory agricultural lien subject to the secured-transactions priority system rather than as a landlord's lien, judicial lien, or ordinary consensual security interest. Courts apply Article 9 filing and priority rules to resolve conflicts with later security interests.
A buyer takes free if the buyer gives value, receives delivery, lacks knowledge of the lien, and acquires the collateral before the lien is perfected. The same protection applies to lessees under parallel rules.
Yes. The lien continues in the collateral after a sale, lease, or other disposition unless the secured party authorized the disposition free of the lien. The lien also attaches to identifiable proceeds.