Agricultural & Employment Law Firm

Frequently Asked Questions

Agricultural Law

Invoices

Do you recommend that we include any particular language on invoices?

Yes. The statutory PACA trust language is essential. In addition, you may want to consider the following:

"A FINANCE CHARGE calculated at the rate of 1½% PER MONTH (18% ANNUALLY), or at the highest rate permitted by law, will be applied to all PAST DUE ACCOUNTS."

"Should any action be commenced between the parties to this contract concerning the sums due hereunder or the rights and duties of any party hereto or the interpretation of this contract, the prevailing party in such action shall be entitled to, in addition to such other relief as may be granted, an award as and for the actual attorney's fees and costs in bringing such action and/or enforcing any judgment granted therein."

"ALL SALES FOB, NO GRADE CONTRACT. All claims must be reported by WRITTEN NOTICE received by seller within 24 HOURS of arrival and supported by acceptable USDA INSPECTION certificates. NO DEDUCTIONS ALLOWED without prior written authorization from seller.

Obviously, the last paragraph should be tailored to your company's sales terms; if you sell by grade, then you should delete the "All sales no grade contract" or if you sell on other than FOB terms, then you should delete that as well. The capitals and bold print should stay in, since these items should be very prominent. In addition, although the attorneys' fees provision is standard and usually very helpful, you should be aware that many states -- including California -- interpret this language as allowing attorneys fees to the "prevailing party" -- which could be either party. However, it is possible that should a judge make a poor decision, you may be stuck with the other side's attorneys' fees. Consequently, you may or may not want to include the attorneys' fees provision.