UPDATES & ANALYSIS

12.30

Iowa Supreme Court Answers Certified Question

by Debra Hulett | December 30, 2011

By Debra Hulett

In Oyens Feed & Supply, Inc. v. Primebank, the Iowa Supreme Court answered a certified question of law from the U.S. District Court for the Northern District of Iowa.  The question asked the Iowa Supreme Court to interpret an Iowa statute relating to agricultural supply dealer liens that was, in the Court’s words, “enacted in the depths of the 1980s farm crisis to help debt-laden farmers buy livestock feed on credit to continue operations.” More specifically, the question asked if livestock feed suppliers must comply with the certified request procedure in Iowa Code § 570A.2 to achieve superpriority status under Iowa Code § 570A.5(3).

Applying statutory construction principles, the Court held that Iowa’s superpriority rule for livestock feed suppliers is independent from the certified request provision, so livestock feed suppliers do not need to comply with 570A.2’s certified request procedure to achieve superpriority status under 570A.5(3). Analyzing the statutory text, the Court concluded that the legislature “selectively incorporated” a certified request affirmative defense in 570A.5 subsection 2 (which established a separate priority rule), but chose not to do so for the livestock feed superpriority lien rule in subsection 3. The Court also recognized that interpretation was consistent with “the legislature’s goal to encourage feed sales to livestock producers already burdened with bank debt.”

The Iowa Supreme Court held oral argument earlier this month. The federal court issued a certification order in March, so the Iowa Supreme Court answered the certified question less than one year after certification.

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