Sec. 6. (a) In addition to the lien provided for in section 1 of this chapter, a person, firm, limited liability company, or corporation that ships, transfers, hauls, or conveys goods, merchandise, machines, machinery, or other articles of value for another person is entitled to a lien:

(1) upon goods, merchandise, machines, machinery, or other articles of value:

(A) shipped;

(B) transferred;

(C) hauled; or

(D) conveyed;

for the other person; and

(2) to cover charges that the other person owes the person, firm, limited liability company, or corporation for goods, merchandise, machines, machinery, or other articles of value previously:

(A) shipped;

(B) transferred;

(C) hauled; or

(D) conveyed;

by the person, firm, limited liability company, or corporation for the other person.

(b) To obtain a lien under this section, a person, firm, limited liability company, or corporation must do the following:

(1) Notify the other person in writing that if the other person fails to pay the person, firm, limited liability company, or corporation for shipping, transferring, hauling, or conveying goods, merchandise, machines, machinery, or other articles of value, the person, firm, limited liability company, or corporation may obtain a lien upon goods, merchandise, machines, machinery, or other articles of value subsequently:

(A) shipped;

(B) transferred;

(C) hauled; or

(D) conveyed;

by the person, firm, limited liability company, or corporation for the other person.

(2) File an intention to hold a lien with a county recorder as provided in section 2 of this chapter.

(c) A sale of property subject to a lien acquired under this section may not take place under section 4 of this chapter:

(1) for at least thirty-five (35) days after the date the person, firm, limited liability company, or corporation that has obtained the lien takes possession of the property; and

(2) unless the person, firm, limited liability company, or corporation that has obtained the lien notifies:

(A) the person that had the property shipped, transferred, hauled, or conveyed;

(B) the consignee of the property; and

(C) a secured party that has a perfected security interest in the property;

of the date, time, and location of the sale at least ten (10) days before the date the sale occurs.

(d) A sale of property subject to a lien acquired under this section may not be concluded if the largest amount bid for the property is not at least equal to the total amount of all outstanding obligations secured by perfected security interests in the property. The proceeds of the sale of property subject to a lien under this section shall be applied as follows:

(1) First, to a secured party that has a perfected security interest in the property in an amount equal to the amount of the perfected security interest.

(2) Second, to the discharge of the lien acquired under this section.

(3) Third, to the legal owner of the property.

If the highest bid for the property does not at least equal the total amount of all outstanding obligations secured by a perfected security interest in the property, the person, firm, limited liability company, or corporation that obtained the lien on the property under this section shall release the property to the legal owner of the property if the legal owner pays the person, firm, limited liability company, or corporation the amount due for shipping, transferring, hauling, or conveying the property that does not include an amount charged for property that the person, firm, limited liability company, or corporation previously shipped, transferred, hauled, or conveyed.

(e) A person, firm, limited liability company, or corporation that obtains a lien under this section:

(1) is liable to a secured party that has a security interest in property covered by the lien:

(A) if the person, firm, limited liability company, or corporation violates this section; and

(B) for damages and expenses, including reasonable attorney's fees, incurred by the secured party in enforcing the secured party's rights; and

(2) is not liable to a consignee of property for damages that the consignee incurs because the person, firm, limited liability company, or corporation obtained a lien on the property under this section.

(f) A perfected security interest in property has priority over a lien obtained under this section.

(g) A lien may not be acquired under this section upon perishable goods.

[Pre-2002 Recodification Citation: 32-8-32-7.]

As added by P.L.2-2002, SEC.18.