Phew...dodged that bullet!!!

Dave H (MI) · Jan 7, 2019

Got a letter from Michigan today. It appears that the owner of my local elevator was lying to me in December when he told me his pit auger was broken. Apparently just a day or two before we talked he had surrendered his license to the State. Now he gets to pay me 50 cents on the dollar for what he did owe me plus a prorated share of whatever he gets for the assets he has on hand. From the sound of the letter, he is closed. Lotts Elevator has been around a very long time and I am sorry to hear it. So the letter states he surrendered his license on 12/6. I believe it was 12/7 or 12/8 that I drove up on the scales with my first load of the year and was turned away. If I had taken the load up the week before I would have taken a hit but the lane was too muddy and I did not want to risk getting stuck. As it was I sold all my corn up in Webberville and was paid on the spot. A quick check of the records shows I have 26 bushels in the bank up at Lotts leftover from 2017. This was for chicken feed. The only down side is now I will be buying corn retail for the rest of the year to feed the chickens as I kept none on hand. Still...a bullet dodged.

Janicholson · Jan 7, 2019

Whew! bad is rarely foreseen Jim

crooked rows · Jan 7, 2019

I thought about how lucky you were when I heard about what was going on......We still have all of our grain stored there......he has an auction scheduled for March if he doen't sell it as a complete unit before then.....he hopes to get enough to pay for the grain that he is short...the state is supposed to cover what he can't....as far as the grain bank everybody around here has been hauling thier's out and taking it someplace else.....

Traditional Farmer · Jan 7, 2019

Are they required to be bonded?

Hay hay hay · Jan 7, 2019

Interesting. This is a good place for a discussion about regulations. Some think we need no regulations. While others think we need checks on businesses to avoid fraud. How do you feel about the state licensing of grain elevators? Good? needed? or pointless over regulation and too cumbersome and expensive for the elevator business?

JD Seller · Jan 7, 2019

I would bet that the state government has a fund set up to cover this. I know that Iowa, IL. and Ohio do.

I just looked it up and it looks like this is what it is called. "Farm Produce Insurance Fund".

Dave H (MI) · Jan 7, 2019

Do you know who the auctioneer is?

flying belgian · Jan 7, 2019

I don't understand. Can't you go get your 26 bushels? It's your corn.

Dave H (MI) · Jan 7, 2019

Yes, it is mentioned in the letter. I just got in and was reading the information. Looks like I paid in as one of the many deductions the elevator took when I sold them my corn over the years so I think I am covered. My total investment here is less than $200 but if I have to buy the corn retail it will be more than that so happy to get what I can. Mostly just sad to see them close. They have always helped me when they could. I will say, though, I never trusted their weights as the incoming truck was always a bit lower there than when I took it elsewhere.

Glad I could not sell to them this year. Saves me another headache.

Traditional Farmer · Jan 7, 2019

I don't know about grain buying places,but here in Virginia Livestock Markets are required to have a bond so if they go broke/bankrupt the bonding company pays off anyone that is
owed money for livestock bought into the sale.Seems it would be easy to require grain buyers/holders to do the same thing.Of course if they are on shakey financial ground it'd put them out of business if they couldn't afford to be bonded.

Dave H (MI) · Jan 8, 2019

I dont know. Going to call in the morning and see. If MI has taken possession, then likely no. If yes then tomorrow I will take the truck up and get it. Im thinkin nope.

oldtanker · Jan 8, 2019

We got one going on here.

http://www.startribune.com/fugitive...minn-faces-federal-criminal-charge/501902201/

Terrible for the guys who were hurt by it.

Rick

crooked rows · Jan 8, 2019

I was told Sheridan

crooked rows · Jan 8, 2019

I talked to a guy last week that said he called the state to find out about his corn in the grain bank and they advised him to get it out of there before the end of January......Brian said he wants to have all the bins empty by mid February....

showcrop · Jan 8, 2019

(quoted from post at 20:13:01 01/07/19) I don't understand. Can't you go get your 26 bushels? It's your corn.

Flying Belgian, generally when a business or any entity is foreclosed on by a secured creditor the court is saying that all assets have to be shared out by all the creditors with the secured ones getting paid first. In this situation product on hand would be considered an asset to be shared. It no longer belongs to Dave. After all, the basic problem here is too many creditors and not enough assets.

Traditional Farmer · Jan 8, 2019

Yea but really is Dave a creditor,to me its more like if I had a car in a shop and it was being worked on and they declared bankruptcy I'd still own the car.

showcrop · Jan 8, 2019

(quoted from post at 05:19:50 01/08/19) Yea but really is Dave a creditor,to me its more like if I had a car in a shop and it was being worked on and they declared bankruptcy I'd still own the car.

The car is different in that the state records and maintains title record on them. However, you would have to go through the court to get it back and only if you paid whatever charges they could find that you may owe. They could even charge you storage if you signed something agreeing to it. That way if you let it stay there too long they could actually get money out of you to help the poor bank to get more.

rrlund · Jan 8, 2019

The first engine machine shop where my two sons worked went through it a few years ago. That wasn't a bankruptcy though,it was a divorce. The guy got too mouthy with the judge and the judge ordered the doors closed and locked "right now". Everything that was in there,no matter who it belonged to,was locked inside. The judge ordered an auction. The only way to get your stuff back was to buy it at the auction. Trouble was,everything similar was lumped together in lots. Engine blocks in one lot,heads in another and so on. Only one guy got his stuff back. He got the wife to go to the judge with him and they got his stuff released to him before the sale. Everybody else lost their stuff.

Spook · Jan 8, 2019

I guess I still don’t understand, was Lott playing games with the scales? Or some fraud in marketing? Had to be pretty bad to result in closure and a auction. I’m going to lunch in the ville today, I’m going to ask around about it. We have a retiree lunch for guys from out lodge.

caterpillar guy · Jan 8, 2019

I thought that was what the Storage Warehouse receipt was for to protect from this type of thing. Though I doubt it would work for feed bank grain.
I know the big deal on your soybean check is to pay for all the guys that didn't get paid from the elevator in ST.Johns MI a few years ago.

JMS/.MN · Jan 8, 2019

Local grain buyer took the neighborhood for 1.1 million back in "92, about 70 customers. One I felt bad for was an older neighbor, third grade education, first year combining...had no storage or dryer, so hauled it to the fat man. Neighbor Don had dairy cows to feed, lived within sight of the elevator, but couldn"t get his corn. Don couldn"t understand that. Once fatman filed BK, everything was an asset to the BK and could not be touched. Fatman was also a fuel dealer, had taken advance payments for Spring fuel. Again, an asset of the BK. He had private investments, filed a business BK. Has not worked a day since. He was in his 40s when he filed.

Phew...dodged that bullet!!!

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