IN THE COURT OF APPEALS OF IOWA

No. 21-0774

Filed April 27, 2022

QUALITY PLUS FEEDS, INC.,

Plaintiff-Appellee,

vs.

COMPEER FINANCIAL, FLCA,

Defendant-Appellant,

and

ETCHER FAMILY FARMS, LLC; ETCHER FARMS, INC.; AGRILAND FS, INC.; 

DEWITT VETERINARY SERVICES, P.C. d/b/a DEWITT VETERINARY CLINIC; 

JASON DENNING; PRECISION PUMPING, INC.; and ELMWOOD FARMS, 

LLC,

Defendants.

________________________________________________________________

Appeal from the Iowa District Court for Monroe County, Daniel P. Wilson, 

Judge.

A financial institution appeals the grant of summary judgment to a creditor 

making a competing claim to collateral. AFFIRMED IN PART, REVERSED IN 

PART, AND REMANDED.

Dustan J. Cross and Rick J. Halbur of Gislason & Hunter, LLP, New Ulm, 

Minnesota, for appellant.

Thomas D. Story, Alexander M. Johnson, and Jennifer E. Lindberg of 

Brown, Winick, Graves, Gross, and Baskerville, P.L.C., Des Moines, for appellee.

Heard by Bower, C.J., and Schumacher and Ahlers, JJ.
2

AHLERS, Judge.

A dairy-cattle operation failed and was liquidated. The proceeds were not 

enough to satisfy the claims of all creditors, leading to this tussle between two 

creditors competing for those proceeds. The district court granted summary 

judgment in favor of one creditor over the other, leading to this appeal.

I. Background1

The dairy-cattle operation consists of three entities: Etcher Family Farms, 

LLC (EFF); Etcher Farms, Inc. (EFI); and Elmwood Farms, LLC (Elmwood). 

Compeer Financial, FLCA (Compeer) is a financial institution that has loaned 

money to one or more of the entities to finance their operations since 2014. The 

loans are secured by real and personal property. The unpaid loan balances 

exceed the value of the proceeds at stake in this case.

Quality Plus Feeds, Inc. (Quality Plus) is a feed and nutrient dealer that 

provided its product to EFF and EFI to feed to their cattle in late 2017 and early 

2018. For ease of reference, we will refer to all product Quality Plus provided as 

“feed.”2 Quality Plus was not paid for the feed it sold to EFF and EFI. The 

proceeds at stake in this case would satisfy the unpaid balance owed to Quality 

Plus. The question is whether Quality Plus has a valid claim to those proceeds.

 

1 The background we provide is intended for informational purposes only. It does 

not bind the parties or the district court on remand.

2 See Iowa Code § 570A.1(8) (2020) (defining “feed” as “a commercial feed, feed 

ingredient, mineral feed, drug, animal health product, or customer-formula feed 

which is used for the feeding of livestock, including but not limited to feed as 

defined in section 198.3”).
3

In March 2018, all three entities of the dairy-cattle operation filed for 

chapter 11 bankruptcy. Those bankruptcy proceedings were dismissed in January 

2019.

The cattle owned by EFF and EFI were sold later in 2019, yielding proceeds 

totaling $1,027,904.09. Cattle owned by all three entities also produced milk that 

was sold in 2019, yielding milk-sale proceeds of $317,308.51. The cattle-sale and 

milk-sale proceeds totaling $1,345,212.60 are the funds over which Compeer and 

Quality Plus are fighting. 

Compeer claims it has a prior, perfected security interest in the collateral 

and is therefore entitled to all the relevant proceeds.3 Quality Plus asserts that it 

has an agricultural-supply-dealer lien in the proceeds under Iowa Code chapter 

570A that has priority over Compeer’s security interests.

4

Quality Plus filed this action seeking to establish its priority in the proceeds. 

Compeer denied Quality Plus’s claim, asserted affirmative defenses, and asserted 

a counterclaim. The counterclaim asserts claims of unjust enrichment, conversion, 

and foreclosure of a security interest. The counterclaim relates to the milk-sale 

proceeds and Quality Plus’s action in asserting an agricultural-supply-dealer lien 

in the proceeds with respect to milk sold by Elmwood—an entity to which Quality 

Plus never sold feed.

 

3 See Iowa Code § 554.9322(1) (generally setting priority among conflicting 

security interest and agricultural liens on a first-in-time, first-in-right order).

4 See Iowa Code § 570A.5(3) (“A lien in livestock feed shall have priority over an

earlier perfected lien or security interest to the extent of the difference between the 

acquisition price of the livestock and the fair market value of the livestock at the 

time the lien attaches or the sale price of the livestock, whichever is greater.”).
4

Quality Plus and Compeer filed competing motions for summary judgment. 

The district court granted Quality Plus’s motion for summary judgment and denied 

Compeer’s, resulting in judgment in Quality Plus’s favor against Compeer in the 

amount of $348,306.30 and foreclosure of its agricultural-supply-dealer liens in that 

amount. In entering judgment, the court determined Compeer’s defenses did not 

defeat Quality Plus’s claims and dismissed Compeer’s counterclaims. Compeer 

appeals. Compeer asserts that Quality Plus should not have been granted 

summary judgment and Compeer should have.

II. Analysis

The parties ask us to resolve nuances of the applicability of various sections 

of the Iowa Code related to priority between competing perfected security interests 

and agricultural-supply-dealer liens. But resolution of those nuances depends on 

the facts, and the material facts have not been determined at this stage of the 

proceeding. So, while the parties ask us to address issues pertaining to competing 

claims of priority, we instead resolve this appeal on the basis of our rules and 

standards related to summary judgment.

We review rulings on motions for summary judgment for corrections of legal 

error.5 Summary judgment in a party’s favor is appropriate if that party 

“demonstrates that there are no disputed issues of material fact and that 

application of the law to the undisputed facts compels judgment in that party’s 

favor.”6

 

5 Buboltz v. Birusingh, 962 N.W.2d 747, 751 (Iowa 2021).

6 Buboltz, 962 N.W.2d at 754.
5

After reviewing the affidavits7 and other supporting documentation 

submitted in support of the dueling summary-judgment motions, we conclude there 

are too many questions left unanswered to permit granting summary judgment to 

either party. Navigating the competing priority rules in Iowa Code chapters 554 

and 570A is a somewhat complex and fact-intensive exercise. In this case, it 

requires consideration of which entities’ cattle were supplied with Quality Plus’s 

feed and what happened to those cattle, as the lien attaches only to the cattle 

consuming the feed8 and their proceeds.

9

 To the extent Quality Plus asserts a lien 

in proceeds, the proceeds would need to be identifiable and traced to subsequent 

assets.10 This would not require burdensome and intensive recordkeeping 

documenting a separate lien on each animal for the amount of feed that animal 

consumed,11 but it requires some level of identification of the proceeds.12 

Identifying the proceeds here requires answers to questions about such things as 

 

7 Compeer asks us not to consider one or more affidavits submitted by Quality Plus 

because they are not based on the personal knowledge of the affiants, as required 

by Iowa Rule of Civil Procedure 1.981(5). While there may be some merit to 

Compeer’s contention, we do not need to resolve this claim, because, even if we 

accept Quality Plus’s affidavits as being based on the personal knowledge of the 

affiants, they are not sufficient to remove all genuine issues of material fact. 

8 See Iowa Code § 570A.3(2) (limiting the feed supplier’s lien to “[l]ivestock 

consuming the feed”).

9 See In re Schley, 509 B.R. 901, 914 (Bankr. N.D. Iowa 2014) (determining “that 

agricultural liens extend to proceeds”).

10 See Citizens Sav. Bank v. Miller, 515 N.W.2d 7, 9 (Iowa 1994) (noting the 

replacement cattle can meet the definition of proceeds if received upon disposition 

of the original cattle, but the proceeds must be identifiable and “traceable” to lateracquired assets).

11 See In re Schley, 565 B.R. 655, 661 (Bankr. N.D. Iowa 2017) (noting it would 

defeat the legislative intent behind chapter 570A of maintaining a fluid feed market

if “burdensome and intensive recordkeeping” were required to track “a separate 

lien on each animal for the amount of feed that that animal consumed” before a 

feed dealer could establish a lien).

12 See Citizens, 515 N.W.2d at 9.
6

whether cattle that consumed Quality Plus feed were sold, whether replacement 

cattle were purchased, or whether the cattle ended up in the Elmwood herd.13 An 

additional unsettled question is what the purchase price was, if any, for the cattle 

sold by EFF and EFI that generated the sale proceeds fought over here. This is 

important because Quality Plus could only get priority over Compeer’s prior, 

perfected security interest “to the extent of the difference between the acquisition 

price of the livestock and the fair market value of the livestock at the time the lien 

attaches or the sale price of the livestock, whichever is greater.”14 While some of 

the cattle sold may have been born into the herd, thus giving them an acquisition 

price of zero,15 it has not been conclusively established whether all or just some of 

the cattle sold were born into the herd. Whether any cattle in the herd were 

purchased and, if so, what the acquisition price was are additional fact questions 

for which no answer is definitively provided. These unanswered questions 

contribute to the need to deny summary judgment.

To some degree, Quality Plus seems to acknowledge that some of the 

questions listed above remain unanswered. Quality Plus seeks to sidestep this 

problem by suggesting that resolution of these questions is not a material question 

 

13 Even though Quality Plus did not supply feed to Elmwood, Quality Plus points to 

the possibility that Elmwood ended up with cattle that were subject to a Quality 

Plus lien, which calls into question whether that lien continued in milk or sale 

proceeds generated from those cattle. Whether that happened, and the extent to 

which it happened, is just one of the many unanswered questions that contribute 

to the conclusion that summary judgment is not appropriate. 

14 See Iowa Code § 570A.5(3) (setting the limit of the priority of an agriculturalsupply-dealer lien).

15 See Oyens Feed & Supply, Inc. v. Primebank, 879 N.W.2d 853, 865–66 (Iowa 

2016) (holding that livestock born into a farming operation have “a zero acquisition 

price for purposes of Iowa Code section 570A.5(3)”).
7

of fact.

16

 It argues that, because the size of the contested pot ($1,345,212.60) is 

so much bigger than the claimed lien ($348,306.30), even if the unanswered 

questions are resolved in Compeer’s favor, all it will do is reduce the size of the 

contested pot, but not to the point that the pot is too small to cover the claimed 

lien. So, Quality Plus argues, the disputed facts are not material, because they 

will not change the outcome.

17

 While we agree that the end result may be that 

resolution of these factual disputes does not change the outcome, it is speculative 

to reach that conclusion based on this record. The unanswered questions create 

a genuine issue as to whether the contested pot is indeed bigger than the claimed 

lien. We will not speculate in order to grant summary judgment.

III. Conclusion

The unanswered questions referenced above are not intended as an 

exhaustive list. They simply highlight some of the important questions not 

answered by this record. Before we, or the district court, can resolve the priority 

disputes at issue in this case, there must be answers to the factual questions 

needed to navigate the statutes. Those factual questions may need to be 

answered by a trial.

Finding genuine issues of material fact that preclude the grant of summary 

judgment for either party, we reverse that part of the district court’s order granting 

summary judgment to Quality Plus. This reversal includes reversal of that part of 

the district court’s ruling that rejected Compeer’s affirmative defenses and 

 

16 See Iowa R. Civ. P. 1.981(3) (permitting summary judgment when “there is no 

genuine issue as to any material fact” (emphasis added)).

17 See Banwart v. 50th St. Sports, L.L.C., 910 N.W.2d 540, 544 (Iowa 2018) (“A 

fact is material when it might affect the outcome of a lawsuit.”).
8

dismissed Compeer’s counterclaims. Compeer’s affirmative defenses and 

counterclaims are reinstated. We affirm the part of the district court’s order that 

denied Compeer’s motion for summary judgment.

We remand for further proceedings consistent with this opinion after denial 

of both parties’ motions for summary judgment. Costs of appeal shall be assessed 

equally between Quality Plus and Compeer.

AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.