Michigan Compiled Laws § 288.517 Breach Of Secured Obligation; Filing Verified Proof Of Claim Or Evidence Of Default; Entry Of Department Order Requiring Creditors To File Claims; Publication Of Order; Audit By Department; Order Allowing Or Disallowing Each Claim; Collection Of Amount From Licensee Or Surety To Satisfy Claims; Action By Attorney General; Award Of Interest; Other Lien, Security, Or Priority.

288.517 Breach of secured obligation; filing verified proof of claim or evidence of default; entry of department order requiring creditors to file claims; publication of order; audit by department; order allowing or disallowing each claim; collection of amount from licensee or surety to satisfy claims; action by attorney general; award of interest; other lien, security, or priority.

Sec. 47.

(1) A person injured by the breach of an obligation secured by a security device described in section 42, 43, or 44, including, but not limited to, a producer and a person representing a commodity check-off program, may file with the department a verified proof of claim or other evidence of default. Upon receipt of a verified proof of claim or other evidence of default, the department may issue an order requiring each interested creditor, as may be known to the department, to file a verified proof of claim before a certain date or be barred from participating in any recovery made by the department.

(2) The department shall provide notice of the entry of an order issued under subsection (1) by posting a copy of the order on the premises described in the license and by publication in accordance with the Michigan court rules that govern service of process by publication. Publication shall be completed at least 30 days before the final date for the filing of claims.

(3) The department shall make the necessary audit and issue an order allowing or disallowing each claim presented. Within 30 days of that order, the department shall send to the principal and surety, by certified mail, notice of allowance or disallowance and request for the payment. The department shall demand and may collect and receive from the licensee, or from the surety or sureties of the licensee, the amount determined to be necessary to satisfy the claims with interest at the judgment rate computed from the date of loss. The department may request that the department of attorney general commence an action for that purpose in a court of competent jurisdiction. If the attorney general prevails in whole or in part, the court shall award interest from the date of loss at the judgment rate. Upon receipt of money paid in partial or complete satisfaction of a claim as provided in this section, the department shall distribute to the claimant in accordance with the order allowing the claim, in full or proportionally.

(4) This section does not affect or impair any other lien, security, or priority for the claim or judgment.

History: 2001, Act 266, Eff. Feb. 8, 2002

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Last modified: October 10, 2016