Stockman Bank of Montana v. Mon-Kota, Inc.
Montana Supreme Court
180 P.3d 1125 (2008)
Stockman Bank (creditor) loaned Hardy Farms $5.5 million secured by a properly perfected security interest in Hardy Farms' crops; Capital Harvest, financing Hardy Farms' agricultural-chemical purchases, later filed an agricultural lien against the same crops under Montana's statutory scheme, though its lien was perfected after Stockman Bank's security interest. Montana's statute granted agricultural liens priority over other security interests regardless of timing, but Stockman Bank argued Capital Harvest hadn't properly perfected its lien under the UCC. Both lower courts ruled for Capital Harvest, and Stockman Bank appealed.
Whether agricultural lien creditors can have priority over other secured creditors if the statute grants that priority and the agricultural lien creditor properly perfected its lien under both the statute and the Uniform Commercial Code.