Holding checks

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There are lots of different situations and different people all of us have to deal with. Take into account the people you are dealing with before you decide how to take payment. Don't put yourself at risk of losing something you can't afford to lose. It is very difficult to get your cattle back if the check bounces, you could even be arrested for stealing or trespassing.
I write checks for everything. I have never had a person turn down or question one of my checks. I would not even think about carrying 50-100 thousand dollars in cash in the truck when I go to look at a group of cattle. Plus all the problems with the cash at the bank and accounting have been brought up in another post.
I am a little different from many of you in that I do not work for people, I do not sell hay or cattle to indivicuals, and I do not sell machinery to individuals. I keep my machinery until it is worn out. I sell my cattle at the sale barn. If a neighbor needs hay, I tell him to get what he needs and give me back the same number, size, and quality hay next hay season, in other words, replace the hay. I do alot of work doing odd jobs or some tractor work or things like that for neighbors, but I do not take money, I tell them up front, I do not work for the public, you can help me out sometime later and we will be even. I have never lost anything by doing things this way.
I am not totally naieve, however. I do understand that just because the sales barn writes me a check, it doesn't mean it is 100 percent safe. If they do not get their money, someone can come after the money from the check. They might not get it, but they can cost me alot of money in legal expenses. I also know that if I buy cattle at the barn, they could have been stolen cattle and they will come after the cattle. So, even the salesbarn is not 100 percent safe.
Many of you sound like you would not want me to come to try to buy cattle you have for sale. When I go look at cattle, I will look them over and decide if they are something I want or not. If they are something I want, I decide what they are worth to me. If they price the cattle to me and the price is what they are worth to me or lower, I tell them I will take them. If they price them to me higher than what they are worth to me, I tell them what I would be willing to do and that is my offer. I don't go up from that and I don't offer low to try to meet in the middle. If the cattle are priced way above what they are worth to me, I just tell the person that the cattle won't work for me and drive off. I don't insult him with an offer that is way below what he is asking. If he is out of line, he will find out pretty quickly without my telling him. I have never had a situation where a person was the least bit aggravated by my dealing. But, there will be a first time, I am sure.
Many of you say you have no time for anyone who makes you an offer of less than the price you have on your product. It has been my experience that every place I have looked at cattle or an item for sale, they want an offer. No one wants to let you drive away without an offer. I think that comes from people wanting to get an idea of what others are willing to give for their product and they feel they have that amount to count on if they do not get a better offer. I very seldom leave offers dangling. My offer is good at that moment, for the most part. Thus my statement that alot of you wouldn't want me trying to buy your product.
A couple of months ago, a neighbor priced me some old cow-calf pairs for 1100 per pair. The market was not very good and they pairs needed to be split and cows slaughtered and the pairs would have weighed out around 850 per pair, tops. He was the kind of guy who would have been real insulted if I had offered him 825, so I just told him I really didn't have a place for them. A couple of weeks later, the market had fallen some more and he took them to the sale barn and cleared just over 800 per pair. He found out how far off he was in his pricing without me making him angry.
I would just say be smart in what you decide about holding checks, accepting checks, carrying boxes of cash in your truck as you drive around and all those things. Good luck in how they turn out for all of us.
 
chippie":2gw8fj76 said:
You are correct about repo-ing. There are legal avenues that have to be done first - such as sending certified letters. You just can't go get the cow.
I repoed for a living for a while in 86 to feed the family. Yes you can just go get the cow. I have repoed cows horses and just about anything else you can think of. Legally you are steeling it until you get it off the property, plus the fact you are trespassing, certified letter or not. If you go through the leggal process it would cost you more than the cow is worth to get it back.
 
novatech":1frdr7vf said:
chippie":1frdr7vf said:
You are correct about repo-ing. There are legal avenues that have to be done first - such as sending certified letters. You just can't go get the cow.
I repoed for a living for a while in 86 to feed the family. Yes you can just go get the cow. I have repoed cows horses and just about anything else you can think of. Legally you are steeling it until you get it off the property, plus the fact you are trespassing, certified letter or not. If you go through the leggal process it would cost you more than the cow is worth to get it back.

One of the ranches that I buy replacements and embryo cows from just had to repo his first cows. Been in the business for 15 years. He "sold" two heifers and a steer all registered, started the paperwork transfer (reg. papers) and the guys said the check was in the mail. A month later the "check" was still in the mail. He finally canceled the papers transfer and repo'd his calves back. They were skin and bones by the time he picked them up. Turned out the guy never fed them or had them on feed.
No explaination to why the "check" was int hemail or why "feed" wasn't supplied or even WHY HE "BOUGHT" them in the first place.
All lessons learned I guess. The more you do business the more of these things happen and you learn from.
Double R
 
Never hold a check. There are several problems. First, by holding the check you are extending the purchaser credit. If the check does not clear the bank, then you are an unsecured creditor. The purchaser's bank has a perfected security interest in your cattle that you sold. If you "repossess" the cattle, then the purchaser's bank can sue you for conversion of their collateral and win. Second, by holding the check, you lose any criminal actions that you could have used. For example, theft by check. Third, if a bankruptcy is filed, then you lose, period. The trustee in bankruptcy can pursue you for a preference and make you return the money--even if you get paid. He can do this because the payment is not in the ordinary course of business. The same thing applies if you go get your cattle back, the Trustee can make you pay for your cattle. No, it is not right; but it is the law of bankruptcy. I have seen too many of these situations in my 20 years of practicing "cow law" in Amarillo. I can (and have) written several articles on this situation as well as taking drafts, when title transfers, and what can the bankruptcy trustee recover. Finally, for those of you who think that "title" to the livestock does not change hands until the check clears the bank--you are very wrong. And it does not matter what your contract says about when title changes. The bank or the bankruptcy trustee always wins. The unpaid seller of livestock always remains unpaid.
 
I had a Registered cow and heifer that I advertised on Craigslist that some people came and looked at last weekend. Second guy asked my bottom dollar cash price, I told him. He then said he would take them but could not pick up until this weekend. I told him the only way I would hold them was with a deposit or full payment. He said that he would write a check for the full amount and date it for the 15th, I asked him to repeat that because I thought you wanted to pick up on the 11th. He said yes that is right, I said you wanted a cash price and I that is what I told you. I stated that I did not know him and the only way I would take check payment was to cash it before the cattle left. He agreed to leave a $100 cash deposit and bring cash today for full payment. I would have been too scared to hold his check.
 

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