At The Time of the Deal
be eligible for trust protection the correct payment term must appear
on the invoice no matter what method of trust preservation is used.
Unless there is an agreement in writing entered into before the
transaction, payment terms are ten (10) days from date of delivery of
the produce. It does not matter if there is an oral agreement as to
different terms, or if there is a course of dealing in which the buyer
or agent always pays beyond 10 days. Without a written agreement before
the transaction, the payment period is 10 days. When there is no
written payment agreement, putting "PACA Terms" on the invoice
If payment terms are extended by a written agreement, then the new payment term must be stated on the invoice to preserve trust rights. Payment
terms entered into before the transaction that are beyond 30 days from
delivery of the produce result in a loss of a seller’s or grower's
After a Failure to Pay
a seller or grower preserves its trust rights, and a buyer or agent
does not pay, a seller or grower can agree to a payment plan for the
past due amount, orally or in writing, without losing its trust rights.
This allows sellers and growers to obtain payment informally without
going to court, and without waiving trust rights. If the informal
payment arrangement does not work, a seller or grower can still hire a
lawyer and take legal action under the trust.