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New rules for cattle disputes

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Published: May 16, 2002

Alberta has introduced new regulations to protect livestock buyers from

lawsuits when disputes over cattle ownership occur.

Among the changes is a new livestock sales manifest that will be

available June 15.

It provides a voluntary declaration of security interests on cattle

that should provide more protection to those buying livestock.

The new manifest indicates whether the full payment is to go to the

seller or if it is to be divided into two cheques – one for the seller

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and one for the lender. Wire transfers are also possible, said Sherry

Morthaller, chair of the Alberta Cattle Title

Committee.

“Many groups would like some legislative changes on this,” she said.

“This may happen through the regulatory review of Livestock Inspection

Services that is coming up.”

Morthaller said the cattle business’s volatile nature, with high levels

of financing and debt, continues to be a problem for the industry.

However, a growing awareness of the problem has forced many buyers to

be more diligent in checking for liens.

The Alberta cattle industry formed the title committee last year after

several lawsuits resulted from a situation known as conversion.

Most cattle are financed and are used as security for loans. When the

seller does not inform the buyer that the stock was used as collateral,

the lender can sue the buyer for money it is owed on transactions

conducted in the last two years.

The new manifest disclosure is confidential and should reduce risk by

providing producers and lien holders more confidence that they will

receive proper payment at the time of the sale, allowing clear transfer

of title to buyers.

Lenders are required to register their security agreements in a

government-administered registry.

Livestock Identification Services will administer the program and if

requested, may conduct personal property registry searches for a small

fee.

LIS will then inform the buyer if there is a lien. If the buyer is

sued, LIS will cover the claim. If the buyer does not ask LIS to search

for liens or if the buyer ignores the information, LIS will not cover

the cost of any claims.

LIS has set aside $1 million over two years to pay claims brought

against dealers or agents.

About the author

Barbara Duckworth

Barbara Duckworth

Barbara Duckworth has covered many livestock shows and conferences across the continent since 1988. Duckworth had graduated from Lethbridge College’s journalism program in 1974, later earning a degree in communications from the University of Calgary. Duckworth won many awards from the Canadian Farm Writers Association, American Agricultural Editors Association, the North American Agricultural Journalists and the International Agriculture Journalists Association.

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