126.68
126.68
Definitions. In this subchapter:
126.68(1)
(1) "Contributing contractor" means any of the following:
126.68 History
History: 2001 a. 16.
126.70
126.70
Recovery proceedings. 126.70(1)
(1)
Default claims. Any of the following persons may file a default claim with the department against a contractor who is licensed, or required to be licensed, under this chapter:
126.70(1)(a)
(a) A grain producer or producer agent, as defined in
s. 126.10 (13), who claims that a grain dealer has failed to pay, when due, for producer grain that the grain dealer procured in this state.
126.70(1)(b)
(b) A depositor who is either a grain producer or a producer agent, as defined in
s. 126.10 (13), and who claims that a grain warehouse keeper has failed to return stored grain or its equivalent upon demand.
126.70(1)(c)
(c) A milk producer or producer agent, as defined in
s. 126.40 (13), who claims that a milk contractor has failed to pay, when due, for producer milk procured in this state.
126.70(1)(d)
(d) A vegetable producer or producer agent, as defined in
s. 126.55 (12), who claims that a vegetable contractor has failed to make payment when due under a vegetable procurement contract.
126.70(2)
(2) Filing default claims. A claimant shall file a default claim under
sub. (1) within 30 days after the claimant first learns of the default, subject to
sub. (3). The claimant shall specify the nature and amount of the default. The department may investigate the alleged default and may require the claimant to provide supporting documentation.
126.70(3)
(3) Initiating a recovery proceeding. 126.70(3)(a)(a) The department may initiate a recovery proceeding in response to one or more default claims under
sub. (1). The department shall issue a written notice announcing the recovery proceeding. The department shall mail or deliver a copy of the notice to the contractor and each claimant in the proceeding.
126.70(3)(b)
(b) If the department has reason to believe that other persons may have default claims under
sub. (1) against the same contractor, the department may invite those persons to file their claims in the recovery proceeding. The department may publish the invitation in any of the following ways:
126.70(3)(b)1.
1. By posting it at the contractor's place of business.
126.70(3)(b)3.
3. By mailing or delivering it to prospective claimants known to the department.
126.70(3)(b)4.
4. By other means that the department considers appropriate.
126.70(3)(c)
(c) In its invitation under
par. (b), the department may specify a deadline date and a procedure for filing default claims. An invitation may indicate the amount of a prospective claimant's apparent claim and may ask the prospective claimant to verify or correct that amount.
126.70(3)(d)
(d) The department may initiate separate recovery proceedings for default claims that comply with
sub. (2) but are filed after the deadline date under
par. (c).
126.70(4)
(4) Auditing claims. The department shall audit each claim included in a recovery proceeding. The department shall disallow a claim if the department finds any of the following:
126.70(4)(a)
(a) That the claim is false or not adequately documented.
126.70(4)(b)
(b) That the claimant filed the claim more than 30 days after the claimant first learned of the contractor's default, unless the department specifies a later claim-filing deadline under
sub. (3) (c).
126.70(4)(c)
(c) That the claimant, without any contractual obligation to do so, continued to deliver grain, milk, or vegetables to the defaulting contractor more than 10 days after the claimant first learned of the contractor's default.
126.70(4)(d)
(d) That the claimant failed to comply with claim-filing deadlines or procedures specified under
sub. (3) (c).
126.70(4)(e)
(e) That the person filing the claim is not an authorized claimant under
sub. (1).
126.70(5)(a)(a) The department shall determine the amount of an allowed claim based on the contract between the parties. If the contract terms are unclear, the department may determine the allowed claim amount based on local market prices, applicable milk marketing order prices, customs in the trade, or other evidence that the department considers appropriate.
126.70(5)(b)
(b) Notwithstanding
par. (a), if the default involves a grain warehouse keeper's failure to return stored grain to a depositor upon demand, the department shall calculate the value of the grain based on local market prices on the day on which the depositor made the demand.
126.70(5)(c)
(c) The department shall subtract from the allowed claim amount any offsetting payments made by the contractor and any obligations for which the claimant is liable to the contractor.
126.70(6)
(6) Proposed decision. After the department completes its audit under
sub. (4), the department shall issue a proposed decision. The department shall mail or deliver a copy of the proposed decision to the contractor and each claimant. The department shall do all of the following in the proposed decision:
126.70(6)(a)
(a) Specify proposed findings of fact, proposed conclusions of law, and a proposed order.
126.70(6)(b)
(b) Allow or disallow each default claim and specify the amount of each allowed claim. The department may disallow part of a claim.
126.70(6)(c)
(c) Specify, for each allowed claim, the amount that the department is authorized to pay under
s. 126.71.
126.70(6)(d)
(d) Specify the method, under
s. 126.71, by which the department will pay the authorized amounts under
par. (c).
126.70(6)(e)
(e) Explain a claimant's right under
s. 126.87 (4) to seek court recovery of that portion of an allowed claim that is not paid by the department.
126.70(6)(f)
(f) Specify a date by which the contractor or claimant may file written objections to the proposed decision.
126.70(7)
(7) Final decision if no objections. If no contractor or claimant files a timely written objection to the proposed decision under
sub. (6), the department may issue the proposed decision as the department's final decision in the recovery proceeding, without further notice or hearing. The department shall mail or deliver a copy of the final decision to the contractor and each claimant.
126.70(8)
(8) Objections to proposed decision; notice, hearing, and final decision. 126.70(8)(a)(a) If a contractor or claimant files a timely written objection to the proposed decision under
sub. (6), the department shall hold a public hearing on the objection. The department shall follow applicable contested case procedures under
ch. 227. The department may hear all objections in a single proceeding. At the conclusion of the contested case proceeding, the department shall issue a final decision affirming or modifying the proposed decision under
sub. (6).
126.70(8)(b)
(b) The department may issue a final decision under
sub. (7) related to default claims that are not affected by objections under
par. (a), regardless of whether the department has completed the contested case proceeding under
par. (a).
126.70 History
History: 2001 a. 16.
126.71
126.71
Paying default claims. 126.71(1)
(1)
Claims against contributing contractor. Except as provided in
sub. (2) or
(3), the department shall pay from the appropriate sources under
s. 126.72 the following default claim amounts:
126.71(1)(a)
(a) Except as provided in
par. (d) or
(e), for each default claim allowed under
s. 126.70 against a grain dealer or milk contractor who was a contributing contractor when the default occurred:
126.71(1)(a)2.
2. Seventy-five percent of any amount allowed in excess of $60,000.
126.71(1)(b)
(b) For each default claim allowed under
s. 126.70 against a grain warehouse keeper who was a contributing contractor when the default occurred, 100% of the first $100,000 allowed.
126.71(1)(c)
(c) For each default claim allowed under
s. 126.70 against a vegetable contractor who was a contributing contractor when the default occurred:
126.71(1)(c)4.
4. Seventy-five percent of any amount allowed in excess of $120,000.
126.71(1)(d)
(d) For each default claim allowed under
s. 126.70 against a qualified producer agent who, at the time of the default, was a contributing contractor and maintained security under
s. 126.47 (3) (a) 3., if the default occurs after April 30, 2002, and before May 1, 2004, 15% of the amount allowed.
126.71(1)(e)
(e) For each default claim allowed under
s. 126.70 against a qualified producer agent who, at the time of the default, was a contributing contractor and maintained security under
s. 126.47 (3) (a) 3., if the default occurs after April 30, 2004, and before May 1, 2007, 20% of the amount allowed.
126.71(1m)
(1m) When default occurs. For the purposes of this chapter, a default occurs on the date on which payment or delivery becomes overdue.
126.71(2)
(2) Claims against contractor who has filed security. If the department allows default claims under
s. 126.70 against a contractor who has security on file with the department, the department shall convert that security and use the proceeds as follows:
126.71(2)(a)
(a) If the contractor was not a contributing contractor when the default occurred, the department shall use the security proceeds to pay the full amount of the allowed claims, except that, if the security is not adequate to pay the full amount of the allowed claims, the department shall pay claimants on a prorated basis in proportion to their allowed claims.
126.71(2)(b)
(b) If the contractor was a contributing contractor when the default occurred, the department shall use the security proceeds to reimburse the sources under
s. 126.72 from which the department makes any claim payment under
sub. (1). If the security amount exceeds the amount payable under
sub. (1) from the sources under
s. 126.72, the department shall use the remaining security proceeds to pay the balance of the allowed claims. If the security amount is not adequate to pay the full remaining balance, the department shall pay claimants on a prorated basis in proportion to their allowed claims.
126.71(2)(c)
(c) Notwithstanding
par. (b), if the contractor was a contributing contractor when the default occurred, the department may, at its discretion, pay claims directly from security proceeds rather than from a fund source under
s. 126.72. If the department acts under this paragraph, the department shall first pay claims in the amounts provided in
sub. (1). If the security amount exceeds the amount payable under
sub. (1) from the sources under
s. 126.72, the department shall use the remaining security proceeds to pay the balance of the allowed claims. If the security amount is not adequate to pay the full remaining balance, the department shall pay claimants on a prorated basis in proportion to their allowed claims.
126.71(3)(a)(a) The department may not pay any portion of the following from any source identified in
s. 126.72:
126.71(3)(a)1.
1. A default claim related to a default by a grain dealer or grain warehouse keeper that occurs before September 1, 2002.
126.71(3)(a)2.
2. A default claim related to a default by a milk contractor that occurs before May 1, 2002.
126.71(3)(a)3.
3. A default claim related to a default by a vegetable contractor that occurs before February 1, 2002.
126.71(3)(a)4.
4. A default claim allowed against a contractor who was not a contributing contractor when the default occurred.
126.71(3)(b)
(b) The department may not pay any default claim under this chapter, except as provided in
sub. (1) or
(2).
126.71(3)(c)
(c) If the total amount of default claims exceeds the amount available under
s. 126.72, the department shall prorate the available amount among the eligible claimants in proportion to the amount of their allowed claims.
126.71(4)
(4) Effect of payment. A claimant who accepts payment under
sub. (1) or
(2) releases his or her claim against the contractor to the extent of the payment. A payment under
sub. (1) or
(2) does not prevent a claimant from recovering the balance of an allowed claim directly from the contractor.
126.71 History
History: 2001 a. 16;
2003 a. 38.
126.72
126.72
Claims against contributing contractor; payment sources. 126.72(1)(1)
Producer security fund. From the appropriation under
s. 20.115 (1) (w), the department shall make payments authorized under
s. 126.71 (1), up to the deductible amount in
sub. (3).
126.72(2)
(2) Proceeds of contingent financial backing. The department, at the direction of the secretary of agriculture, trade and consumer protection, shall draw on the contingent financial backing acquired under
s. 126.06 to make payments authorized under
s. 126.71 (1), to the extent that those payments exceed the deductible amount in
sub. (3).
126.72(3)
(3) Deductible amount. The deductible amount, for purposes of
subs. (1) and
(2), is 60% of the cash balance in the agricultural producer security fund on the last day of the month preceding the month in which the default occurs.
126.72 History
History: 2001 a. 16;
2003 a. 38.
