Livestock purchasers; prompt payment; penalty; lien.

(1)(a) A purchaser that purchases livestock from a seller shall make payment by cash or check for the purchase price of the livestock and actually deliver the cash or check to the seller or her or his representative at the location where the purchaser takes physical possession of the livestock on the day the transfer of possession occurs or by wire transfer of funds on the business day within which the possession of the livestock is transferred. However, if the transfer of possession is accomplished after normal banking hours, payment shall be made in the manner provided in this subsection no later than the close of the first business day following the transfer of possession. In the case of grade and yield selling, the purchaser shall make payment by wire transfer of funds or by personal or cashier’s check by registered mail postmarked no later than the close of the first business day following determination of grade and yield.

(b) All instruments issued in payment as required by this section shall be drawn on banking institutions which are so located as not artificially to delay collection of funds through the mail or otherwise cause an undue lapse of time in the clearance process.

(2) A purchaser of livestock that fails to comply with subsection (1) or artificially delays collection of funds for the payment of the livestock shall be liable to pay the seller of the livestock, in addition to the price of the livestock:

(a) Twelve percent damages on the amount of the price.

(b) Interest on the purchase price of the livestock at the highest legal rate from and after the transfer of possession until payment is made as required by this section.

(c) Reasonable attorney fees, court costs, and expenses for the prosecution of collection of the payment.

(3)(a) A seller that sells livestock to a purchaser shall have a lien on such animal and its carcass, all products therefrom, and all proceeds thereof to secure all or a part of its sales price.

(b) The lien provided in this subsection shall be deemed to have attached and to be perfected upon delivery of the livestock to the purchaser without further action, and such lien shall continue in the livestock and its carcass, all products therefrom, and all proceeds thereof without regard to possession thereof by the party entitled to such lien without further perfection.

(c) If the livestock or its carcass or products therefrom are so commingled with other livestock, carcasses, or products so that the identity thereof is lost, then the lien granted in this subsection shall extend to the same effect as if same had been perfected originally in all such animals, carcasses, and products with which it has become commingled. However, all liens so extended under this paragraph to such commingled livestock, carcasses, and products shall be on a parity with one another, and, with respect to such commingled carcasses or products upon which a lien or liens have been so extended under this paragraph, no such lien shall be enforceable as against any purchaser without actual knowledge thereof purchasing one or more of such carcasses or products in the ordinary course of trade or business from the party having commingled such carcasses or products or against any subsequent transferee from such purchaser, but in the event of such sale, such lien shall instead extend to the proceeds of such sale.