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MAPP Plastics Discussion Forum

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Posted:  16 Apr 2009 15:03
Members-

I am wanting to gather information about the IN Mold Lien Law. If you can help in anyway please let me know.

Lindsey Hahn
Metro Plastics
l.hahn@metroplastics.com
Posted:  16 Apr 2009 15:06
Lindsey-

If you go to the website below it gives information about this. Feel free to contact me if you have additional questions.

http://www.in.gov/legislative/ic/code/title32 ...

Bob Tennyson
Posted:  21 Apr 2009 14:37   Last Edited By: Admin
Below is a memo on the Indiana Mold Lien Law. As you will see, your lien has priority over any other lien, even if the customer files for bankruptcy.  However, you need to keep possession of the mold at all times until the amount owed you is paid in full.

To enforce the lien, you need to send a letter to the customer. If you would like us to draft that letter for you, please let me know as we will make sure that the format can be used as a template for future letters (if necessary). 

The memo concludes with telling you what you can do with the mold by way of selling the mold if the customer never pays you.

Please let me know if you have any questions or require follow-up work.


H. Alan Rothenbuecher
Schottenstein Zox & Dunn Co., LPA
US Bank Centre
1350 Euclid Avenue, Suite 1400
Cleveland, OH 44115
p  216-394-5075
f   216-394-5092
arothenbuecher@szd.com
www.szd.com

MEMORANDUM
TO: Rob Stefancin and Alan Rothenbuecher
Client
FROM: Linda Mindrutiu
DATE: April 17, 2009
RE: Indiana’s Molder’s Lien statute

Issue: What are the rights of a mold lienholder under Indiana law?

Short answer: A molder, called a fabricator in Indiana, has a lien on any molds in its possession for amounts owed by a customer. This lien is superior to other security interests in the molds. A
fabricator must provide written notice in order to enforce the lien and sell the molds.

Indiana’s molder’s lien statutes are located in Chapter 32-33-16 of the Indiana Code.

What is a molder?
A molder in Indiana is called a “fabricator” and includes an individual or entity who (i) manufactures a mold1 or (ii) uses or contracts to use a mold to manufacture a product. IC 32-33-16-2.

The fabricator’s lien.
The fabricator has a lien on any molds in its possession belonging to a customer. The lien is for the amount due the fabricator for fabrication work performed with the mold. Possession is key to the existence of the lien. The fabricator may retain possession of the mold until the amount due is paid. IC 32-33-16-3.

Enforcing the lien
This must be accomplished through notice, which must be given in writing to the customer by either personal delivery or certified mail to the last known address of the customer.

The notice must: (i) state that a lien is claimed; (ii) set forth damages for the amount due for fabrication work or for making or improving the mold; and (iii) demand payment. IC 32-33-16-4.

Sale of the molds
If the fabricator is not paid by the customer within 60 days after the notice is sent, the fabricator may sell the molds in its possession at auction. IC 32-33-16-5. Before sale, the fabricator must
provide a second notice, in writing, by certified mail, return receipt requested, to the customer and any person whose interest in the molds is perfected by filing (in other words, this requires a
search of the UCC records).

1 The statute includes any individual or entity, including a tool or die maker, that manufactures, or causes to be
manufactured, assembles, or improves a mold, die, form, jig, or pattern. For purposes of simplicity, this memo
refers only to a mold, but the statues apply to all of the above.
{H1503879.2 } 2

The second notice must state: (i) the fabricator’s intention to sell the mold within 30 days of the customer’s receipt of the notice, (ii) description of the mold, (iii) time and place of the sale, and (iv) an itemized statement of the amount due. If the customer objects in writing to the amount due, the fabricator may file a complaint to foreclose the lien. If there is no return receipt or the
certified mail comes back nondeliverable, the fabricator is required to publish a notice in a newspaper of general circulation in the county where the mold is being held for sale; the newspaper notice must describe the mold and name the customer. IC 32-33-16-6.

If the sale price is greater than the amount of the lien plus reasonable expenses of the sale, any excess is to be paid to the customer and any prior lienholder. IC 32-33-16-7.

Priority of lien
Pursuant to IC 26-1-9.1-333, a possessory lien created by statute has priority over other security interests in the goods. Because a fabricator perfects its lien in molds by possession via the molder’s lien statute, its lien has priority over other interests in the molds.

Miscellaneous
The sale of molds may not go forward if it would violate federal patent or copyright laws. IC 32-33-16-8. The molder’s lien statute does not prevent a customer from bringing an action for
replevin. IC 32-33-16-9.
Posted:  09 Feb 2010 23:09
Good information to know. Can any body assist with TEXAS mold lien laws?
Posted:  10 Feb 2010 00:54
Sure.  Let me know what your question is and I can let you know how Texas law would handle.  You can post your question here, or call me direct:  216-394-5075

-Alan Rothenbuecher
Posted:  27 Oct 2015 19:35
Can the lien be placed on molds after the customer files chapter 11 and what happens to the lien or debt if the assets are sold by the creditor in posession
Posted:  27 Oct 2015 20:09
The lien is possessory, which means if you don't have the molds, then the lien is no effect.  If you have the molds, the lien took effect from the day you were owed money.  Happy to discuss live; call 216-394-5075.

-Alan Rothenbuecher
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