Publications: Perishable Agricultural Commodities
Perishable Agricultural Commodities Act Factsheet
Harrison M. Pittman Center Director National Agricultural Law Center
The Perishable Agricultural Commodities Act, or “PACA,” was enacted in 1930 to regulate the marketing of perishable agricultural commodities in interstate and foreign commerce. The primary purposes of the PACA are to prevent unfair and fraudulent conduct in the marketing and selling of perishable agricultural commodities and to facilitate the orderly flow of perishable agricultural commodities in interstate and foreign commerce. PACA is important for many specialty crop producers because it governs important aspects of transactions between sellers and buyers of fresh and frozen fruits and vegetables. In particular, the unfair conduct and the statutory trust provisions are particularly significant. This factsheet addresses unfair conduct, licensing, and the statutory trust provisions found within the Perishable Agricultural Commodities Act. Download this article. Posted September 28, 2012.
Secured Lending in the Produce Industry: What Every Bank Should Know
Jason R. Klinowski Senior Associate Keaton & Associates, P.C.
One of the most misunderstood and hotly contested areas of litigation under the Perishable Agricultural Commodities Act (the “PACA”) involves balancing the rights of a secured lender against an unpaid PACA trust beneficiary. A significant contributing factor to the misunderstandings appurtenant to such litigation is the shortage of controlling case law. In an effort to guide litigants through such a dispute, this article provides an explanation of the PACA trust and its limits. Further, this article will introduce and analyze the key decisions addressing the rights of secured lenders and unpaid PACA trust beneficiaries. Download this article. Posted: January 23, 2009.
Perishable Agricultural Commodities Act Round-Up: A Review of Recent Cases
Harrison M. Pittman Staff Attorney The National AgLaw Center
The Perishable Agricultural Commodities Act (“PACA”)was enacted in 1934 “for the purpose of regulating the interstate business of shipping and handling perishable agricultural commodities such as fresh fruit and vegetables” and to “provide a practical remedy to small farmers and growers . . . vulnerable to sharp practices of financially irresponsible and unscrupulous brokers in perishable agricultural commodities.” George Steinberg & Son, Inc. v. Butz; Chidsey v. Geurin. PACA is important legislation for individuals and entities involved in the buying and selling of perishable agricultural commodities. Numerous legal issues arise in court actions brought pursuant to PACA. These issues include whether lending institutions are required to disgorge funds they receive from a buyer of perishable agricultural commodities, whether a produce supplier holds a valid claim to the assets of a PACA statutory trust, whether a produce buyer’s or seller’s conduct violates certain PACA requirements, and whether the officers and directors of a corporation that purchased perishable agricultural commodities could be held personally liable for the corporation’s failure to pay the produce seller. Litigation dealing with these issues and others are addressed in this article, which summarizes significant cases brought pursuant to PACA that were issued between January 1, 2002, and June 1, 2003. Download this article. Posted Dec. 10, 2003
The Perishable Agricultural Commodities Act: The Statutory Trust and Its Application to Restaurants
Harrison M. Pittman Staff Attorney The National AgLaw Center
In 1930, Congress enacted the Perishable Agricultural Commodities Act (“PACA”) “for the purpose of regulating the interstate business of shipping and handling perishable agricultural commodities such as fresh fruit and vegetables.” The primary purpose of the PACA is to “provide a practical remedy to small farmers and growers who [are] vulnerable to sharp practices of financially irresponsible and unscrupulous brokers in perishable agricultural commodities.” In 1984, Congress amended the PACA to include a statutory trust for the benefit of unpaid sellers of perishable agricultural commodities. For nearly seventy years it was widely believed that the PACA did not apply to restaurants and restaurant chains. This article briefly discusses the PACA’s applicability and the types of conduct it prohibits. It also examines the statutory trust provisions, how the statutory trust operates, and to whom the trust generally applies. Finally, this article analyzes and discusses the cases that have held that restaurants can be subject to the PACA and therefore its statutory trust provisions. Download this article. Posted: Jan. 21, 2003.