Summary of a Recent
Judicial
Development in
Packers and Stockyards Act
Court Considers Contract Cattle Feeders’
Contract and Other Claims
Jillian HishawNational AgLaw Center Graduate Assistant
In Hecksel v. Central Livestock Assn., Inc., No.03-2604JRTJSM, 2005 WL 2406032 (D.Minn. Sep. 29, 2005), the United States District Court of Minnesota considered various state and federal claims related to cattle feeding contract. The plaintiffs, the Hecksels, entered into a cattle feeding agreement with the defendant, Central Livestock Association (CLA), a Minnesota livestock cooperative. Id at 1. In the agreement, CLA retained ownership and a security interest in the cattle they supplied to the Hecksels for fattening. Id at 1. The Hecksels were responsible for all of the costs and fees associated with raising the livestock. When the cattle reached the proper weight, they were sold on the market by CLA The agreement allowed the Hecksels to retain a portion of the profits. Id at 1. The Hecksels’ alleged that CLA supplied them with diseased cattle, retained a security interest in cattle owned separately by the Hecksels, and overcharged certain fees. Id at 2. In their complain, the Hecksels’ alleged that CLA violated numerous contract provisions, a number of federal laws, including the Packers and Stockyards Act, Commodities and Exchange Act, Racketeer Influenced and Corrupt Organization Act, and several state consumer fraud statutes. Id at 1.
The Court refused to find a breach of contract since the agreement stipulated that the Hecksels’ were responsible for most of the actions that they alleged CLA violated. Id at 4, 5, 6. The Court found that the Hecksels waived their right to object to the delivery of the diseased cattle since they did not object within 24 hours of delivery, leaving the Hecksels to bear the death loss. Id at 4. In addition, the contract clearly stated that CLA security interest was limited to only the cattle they provided to the Hecksels. Id at 4. Lastly, as to the alleged overcharging of fees, the Court denied CLA’s motion for summary judgment finding the issue to be a question for the jury. Id at 5. In regards to the Packers and Stockyards Act allegation of deceptive practices, the complaint exceeded the four-year statute of limitation. Id at 7.. According to the court “Generally, the period commences on the date on which the wrongdoer commits an act that injures the business of another.” Id at 7. The Commodities and Exchange Act violation was also time barred by the statute’s two-year limitation. 7 U.S.C. § 25(c); id. at 7. Because the Hecksels failed to provide any proof of racketeering or fraud, the court dismissed the Hecksels racketeering charge. Finally, CLA’s request for summary judgment was granted in regard to the state consumer and common law fraud claims. Id at 7-9.
The case was decided on September 29, 2005; this summary was posted Mar. 31, 2006.