(225 ILCS 735/4) (from Ch. 111, par. 704)

(Text of Section before amendment by P.A. 103-218)

Sec. 4. Bond. Every person licensed as a timber buyer shall file with the Department, on a form prescribed and furnished by the Department, a performance bond payable to the State of Illinois by and through the Department and conditioned on the faithful performance of and compliance with all requirements of the license and this Act. The bond shall be a surety bond signed by the person to be licensed as principal and by a good and sufficient corporate surety authorized to engage in the business of executing surety bonds within the State of Illinois as surety thereon. In lieu of a surety bond an applicant for a timber buyers license may, with the approval of the Department, deposit with the Department as security a certificate of deposit or irrevocable letter of credit of any bank organized or transacting business in the United States in an amount equal to or greater than the amount of the required bond. Such deposits shall be made, held, and disposed of as provided in this Act and by the Department by rule. A bond or certificate of deposit shall be made payable upon demand to the Director, subject to the provisions of this Act, and any rules adopted under this Act, and shall be for the use and benefit of the people of the State of Illinois, for the use and benefit of any timber grower from whom the applicant purchased timber and who is not paid by the applicant or for the use and benefit of any timber grower whose timber has been cut by the applicant or licensee or his or her agents and who has not been paid therefor; and for the use and benefit of any person aggrieved by the actions of the timber buyer.

Except as otherwise provided, in this Section, such bond shall be in the principal amount of $500 for an applicant who paid timber growers $5,000 or less for timber during the immediate preceding year, and an additional $100 for each additional $1,000 or fraction thereof paid to timber growers for timber purchased during the preceding year, but shall not be more than $10,000. In the case of an applicant not previously engaged in business as a timber buyer, the amount of such bond shall be based on the estimated dollar amount to be paid by such timber buyer to timber growers for timber purchased during the next succeeding year, as set forth in the application; such bond shall, in no event, be in the principal amount of less than $500. In the case of a timber buyer whose bond has previously been forfeited in Illinois or in any other state, the Department shall double the applicable minimum bond amounts under this Section.

A bond filed in accordance with this Act shall not be cancelled or altered during the period for which the timber buyer remains licensed by the Department except upon at least 60 days notice in writing to the Department; in the event that the applicant has deposited certificates of deposit in lieu of a corporate surety the Department may retain possession of such certificates of deposit for a period of 60 days following the expiration or revocation of his or her license.

At any such time as a licensee fails to have the necessary surety bonds, certificates of deposit, or irrevocable letters of credit on deposit with the Department as required herein, the Department may immediately, and without notice, suspend the privileges of such licensee. In the event of such suspension, the Department shall give immediate notice of the same to the licensee and shall further reinstate such license upon the posting of the required surety bond, certificates of deposit, or irrevocable letters of credit.

Bonds shall be in such form and contain such terms and conditions as may be approved from time to time by the Director, be conditioned to secure an honest cutting and accounting for timber purchased by the licensee, secure payment to the timber growers and to insure the timber growers against all fraudulent acts of the licensee in the purchase and cutting of the timber of this State.

In the event the timber buyer fails to pay when owing any amount due a timber grower for timber purchased, or fails to pay judicially determined damages for timber wrongfully cut by a timber buyer or his agent, whether such wrongful cutting has occurred on or adjacent to the land which was the subject of timber purchase from a timber grower, or commits any violation of this Act, then an action on the bond or deposit for forfeiture may be commenced. Such action is not exclusive and is in addition to any other judicial remedies available.

In the event that the timber grower or owner of timber cut considers himself or herself aggrieved by a timber buyer, he or she shall notify the Department in writing of such grievance and thereafter the Department shall within 10 days give written notice to the timber buyer of the alleged violation of this Act or of any violation or noncompliance with the regulations hereunder of which the timber grower or owner of timber complains. The written notice to the timber buyer shall be from the Department by registered or certified mail to the licensee and his or her sureties stating in general terms the nature of the violation and that an action seeking forfeiture of the bond may be commenced at any time after the 10 days from the date of said notice if at the end of that period the violation still remains. In the event the Department shall fail to give notice to the timber buyer as provided herein, the timber grower or owner of timber cut may commence his or her own action for forfeiture of the licensee's bond.

The timber buyer, after receiving notice from the Department as provided herein, may within 10 days from the date of such notice, request in writing to appear and be heard regarding the alleged violation.

Upon such request from the timber buyer, the Department shall schedule a hearing, designating the time and place thereof. At such hearing the timber buyer may present for consideration of the Department any evidence, statements, documents or other information relevant to the alleged violation. The hearing shall be presided over by the Director or by any hearing officer he or she may designate. The hearing officer shall take evidence offered by the timber buyer or the Department and shall, if requested by the Department, submit his or her conclusions and findings which shall be advisory to the Director. Any hearings provided for in this Section shall be commenced within 30 days from the request therefor.

Should the timber buyer fail to make timely request for a hearing after receipt of the notice from the Department as provided herein, or after a hearing is concluded, the Department may either withdraw the notice of violation or request the Attorney General to institute proceedings to have the bond of the timber buyer forfeited. The Attorney General, upon such request from the Department, shall institute proceedings to have the bond of the timber buyer forfeited for violation of any of the provisions of this Act or for noncompliance with any Department regulation.

In the event that the licensee's bond is forfeited, the proceeds thereof shall first be applied to any sums determined to be owed to the timber grower or owner of timber cut and then to the Department to defray expenses incurred by the Department in converting the security into money. Thereafter, the Department shall pay such excess to the timber buyer who furnished such security.

In the event the Department realizes less than the amount of liability from the security, after deducting expenses incurred by the Department in converting the security into money, it shall be grounds for the revocation of the timber buyer's license.

(Source: P.A. 92-805, eff. 8-21-02.)

(Text of Section after amendment by P.A. 103-218)

Sec. 4. Liability insurance. Every person licensed as a timber buyer shall file with the Department a certificate of liability insurance. No such liability insurance policy shall be effective under this Section unless issued by an insurance company or surety company authorized to do business in this State.

Except as otherwise provided in this Section, such liability insurance shall be in the principal amount of not less than $500,000.

A liability insurance policy filed in accordance with this Act shall not be canceled or altered during the period for which the timber buyer remains licensed by the Department without written notification to the Department. At all times, a licensee must have a liability insurance policy that is in conformity with this Act while licensed by the Department.

At any such time as a licensee fails to have the necessary liability insurance, as required herein, the Department may immediately, and without notice, suspend the privileges of such licensee. In the event of such suspension, the Department shall give immediate notice of the same to the licensee and shall further reinstate such license upon filing with the Department a certificate of liability insurance that conforms to the requirements of this Act.

(Source: P.A. 103-218, eff. 1-1-24.)